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Ghazanfar Ali Khan Etc. Vs. State of U.P. and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad High Court
Decided On
Case NumberWrit Petn. No. 2971 of 1980
Judge
Reported inAIR1982All201
ActsConstitution of India - Articles 14, 19(1) and 226; Essential Commodities Act, 1955 - Sections 3 and 5; Sugar Cane (Control) Order, 1966
AppellantGhazanfar Ali Khan Etc.
RespondentState of U.P. and ors.
Appellant AdvocateRishi Ram, Adv.
Respondent AdvocateChief Standing Counsel
DispositionPetition dismissed
Excerpt:
(i) constitution - cancellation of notification issued by government - article 226 of constitution of india - high court cannot cancel any notification of government on grounds that policy of government behind notification is not rational. (ii) rationale behind notification - section 3 of essential commodities act, 1955, clause 8 of sugar cane (control) order, 1966 and article 226 of constitution of india - a notification cannot be cancelled by high court merely on ground that it did not contain the rationale behind the notification - rationale can be explained in the written statement if objections raised about its validity. (iii) opportunity of being heard - section 3 of essential commodities act, 1955, clause 8 of sugar cane (control) order, 1966 and clause 4 of u. p. restriction on.....k.c. agarwal, j.1. this is a petition under article 226 of the constitution challenging the validity of the notification dated 16th dec. 1980, published in the extraordinary gazette of the state of u.p. of the same date, under clause 8 of the sugarcane (control) order, 1966 (hereinafter referred to as 'the control order, 1966').2. the petitioner is a partnership firm which has a power crusher situate in village basikkirapur, district bijnor, measuring 11'x 14' in size. the petitioner has been manufacturing gur by the crusher. as required by u.p. khandsari sugar manufacturers licensing order, 1967 (hereinafter referred to as the khandsari order), the petitioner had obtained a licence under clause 3 of the said order. this licence was renewed from time to time and was lastly renewed on 3rd.....
Judgment:

K.C. Agarwal, J.

1. This is a petition under Article 226 of the Constitution challenging the validity of the notification dated 16th Dec. 1980, published in the Extraordinary Gazette of the State of U.P. of the same date, under Clause 8 of the Sugarcane (Control) Order, 1966 (hereinafter referred to as 'the Control Order, 1966').

2. The petitioner is a partnership firm which has a power crusher situate in village Basikkirapur, district Bijnor, measuring 11'x 14' in size. The petitioner has been manufacturing Gur by the crusher. As required by U.P. Khandsari Sugar Manufacturers Licensing Order, 1967 (hereinafter referred to as the Khandsari Order), the petitioner had obtained a licence under Clause 3 of the said Order. This licence was renewed from time to time and was lastly renewed on 3rd Oct., 1980, for the crushing season 1980-81. The petitioner was also granted a permit under Clause 4 of the U.P. Restriction on Sugarcane Purchase Order issued by the Governor of Uttar Pradesh in exercise of the powers under Clause 6, 7, 8 and 9 of Control Order, 1966. For the year in question, that is 1980-81 the petitioner had been granted permit by the Prescribed Authority in the prescribed form. This permit is issued to a person who holds licence under the U.P. Sugar-cane (Purchase Tax) Act, 1961 or the U. P. Khandsari Order, 1967. The permit entitles a person to purchase sugarcane for crushing by a power crusher in reserved area. Clause 3 prescribes that in a reserved area, (i) no sugarcane can be purchased for crushing by a power crusher, and (ii) no sugarcane or sugar-cane juice can be purchased for crushing or for manufacture of Gur, Shakkar, Gul, Jaggery, rab or khandsari sugar, by a Khandsari Unit, except under and in accordance with a permit issued by or on behalf of the Commissioner in that behalf.

3. For the year 1980-81 the petitioner had exercised option under Section 3 of U.P. Sugarcane (Purchase Tax) Act, 1961 and had also informed the authorities that he would start his crusher from 12th Oct., 1980. The petitioner alleged that the crushing of sugarcane of his personal farm and also from the sugarcane purchased by him started on the aforesaid date.

4. On 16th Oct., 1980 the Cane Commissioner issued an order under Clause 8 of the Control Order, 1'966, directing that no owner of power crusher (Other than those vertical power crushers which manufacture Gur or Rab from sugarcane grown on their own fields), shall, in any reserved area of any Sugar Mill, work the power crusher, or the Khandsari Unit prior to Dec. 1, 1980 during the year 1980-81. The order is being quoted below:

'In exercise of the powers under Clause 8 of the Sugarcane (Control) Order, 1986 read with the Central Government Ministry of Food, Agriculture, Community Development and Co-operation (Department of Food), Government of India, Order No. G.S.R. 1 1 27-Ess Comm/Sugar-cane, dated July 16, 1966, I, Bhola Nath Tewari, Cane Commissioner, Uttar Pra-desh hereby direct that no owner of power crusher (other than those vertical power crushers which manufacture Gur or Rab from sugarcane grown on their own fields) or a Khandsari Unit or any agent of such owner shall, in any reserved area of any sugar mill work the power crusher, or the Khandsari Unit prior to December 1, 1980 during the year 1980-81.'

5. Challenging the vires of the aforesaid order as well as its validity, the petitioner filed the present writ petition and urged the following points :--

1. There was no valid delegation of powers under Clause 8 of Control Order, 1966, inasmuch as no notification had been issued under Section 5 of the Essential Commodities Act.

2. Sub-delegation in favour of the Cane Commissioner, U.P. under Clause 11 of the Control Order, 1966 was invalid.

3. Clause 8 of the Control Order, 1966, is void on account of excessive delegation of powers.

4. The impugned Notification is beyond the power conferred on the Cane Commissioner under clause 8 of the Control Order, 1966.

5. The impugned Notification dated 16th October, 1980 exempting the vertical power crushers from its operation discriminated the petitioner unreasonably and as such, the same was hit by Article 14 of the Constitution.

6. The Notification dated 16-10-1980 issued under Clause 8 of the Control Order, 1966, by the Cane Commissioner has been issued on wholly irrelevant and extraneous considerations, hence was invalid.

7. The impugned Notification amounts to suspending the licence of the petitioner and others which could not have been done without opportunity of hearing being granted.

6. Before dealing with the points, mentioned above, it may be useful to refer to the Chart annexed as Annexure A. 2 to the counter-affidavit of Yadu Nath Bali, Deputy Cane Commissioner, showing the sugarcane production in the reserved areas of the sugar factories and utilization by Sugar factories, power crushers and Sugar Manufacturers, The Chart is being quoted below :--

1974-75 to 1979-80

Year

Sugar : Cane

Present Cane Utilised for

Production (Lac Tonnes).

White Sugar

Power Crash for Khandsarl gui.

For manufacture of Gur etc.

1.

2.

3.

4.

5.

1974-75

523.52

28.98

18.36

43.16

1975-78

503-24

21.29

10.93

47.28

1976-77

536.60

28.24

12.51

41.75

1977-78

680.56

30.19

15.52

36.79

1978-79

678.78

27.24

9.73

45.53

1979-80

471.11

21.66

11.79

49.05

7. With the aid of the aforesaid Chart, Sri Rishi Ram, learned counsel appearing for the petitioner, urged before us that the expected sugarcane production of the year in question is to exceed 600 lac tonnes and as the total requirement of the Sugar factories for the benefit of whom the impugned notification dated 16th Oct., 1980, has been issued was only a small production thereof (sic) the State Government's action prohibiting the power crushers from manufacturing Gur and Khandsari was wholly unjustified and was arbitrary. Counsel's suggestion was that this had been done arbitrarily to benefit the sugar factories and to create a monopoly in their favour so that they could get sugarcane at a cheap price resulting in huge loss as to be suffered by the cultivators and ousting the Khandsari and Gur manufacturers altogether from the market. The sugar policy adopted by the Government concerned has been faulty and has brought about chaotic conditions in the market. Counsel urged that if the Government had adopted a pragmatic policy, the price of sugar could not have been risen so high and that enough sugar would have been available in the market without any import being made from foreign countries.

8. Apart from the power of a court to interfere in these matters on the ground of short sighted policy of the Government, it appears that consumption of sugar has increased rapidly, whereas its output has declined. In his Book on 'Sugarcane in India' 1972 Edn., S. V. P. Parthasharti has analysed the above position in following words:--

'Sugarcane production and consequently sugar availability have been subject to wide fluctuations from season to season so that we have lived in the fear of cyclic surpluses and scarcities. The consumption of sugar has increased rapidly from 26,00,000 tonnes in 1968-69 to 40.2 lac tonnes in 1970-71. On the other hand, sugar output has declined rather steadily from 42.6 lac tonnes in 1969-70 to 37.4 lac tonnes in 1970-71 and as low as 31 lac tonnes in 1971-72.'

9. From the figures given above, it would be found that we are facing a sudden transition from a year of plenty to that of scarcity on the sugar front. The estimated demand for sugar is now much more than it was in 1971-72. It is no use denying that scarcity of sugar posed a very serious problem before the Central and State Government as well as the public at large. The price of sugar went very high. On account of shortage in supply, sugar had to be imported by the Central Government. In paragraph 5 of the counter-affidavit filed on behalf of the respondents the averments made are that one of the major factors responsible for the present rise of prices of sugar is that there is a sharp rise of demand for consumption. The demand could not be met on account of fall in the production in 1979-80. The statement made in that connection was that whereas the demand of sugar had increased to over 60 lac tonnes, the sugar production in 1979-80 (October-September) was 39.5 lac tonnes. This short supply was due to the poor availability of sugarcane on account of drought conditions in the country and particularly in the State of U.P.

The averment made further was that on account of diversion of cane to Gur and Khandsari manufacturers, sugar production declined from 14.63 lac tonnes in 1978-79 to 9.97 lac tonnes in 1979-80. Justifying the validity of the impugned notification, the respondents alleged that the closing stock of sugar in 1978-79 was 20.63 lac tonnes whereas the closing stock in 1979-80 was insignificant and was likely to be exhausted by the middle of Nov. 198C. To meet this national crisis, the Government of India took various steps to increase the production of sugar during 1980-81, for that purpose, certain steps have been taken to meet this situation and to make sugarcane available to sugar factories the Cane Commissioner imposed prohibition on the power crushers situated in the reserved areas prohibiting them from manufacturing Gur, Khandsari etc.

10. After having considered the figures given in the Chart and the argument of the learned counsel for the parties we are of opinion that the submission made on petitioner's behalf that as the policy adopted was unreasonable, therefore, the impugned order was liable to be quashed, cannot be accepted. The problem facing the Government is difficult. It may admit of several solutions. It is not possible for this Court witn the limitations within which it has to work, either to quash a certain decision based on the policy or to surmise thereon on its own. The Court is not a policy maker. It does not have either power or capacity to do so. Dealing with this aspect of the matter, a learned Author has observed:

'The Judges are not particularly well equipped to arrive at fundamental policy decisions of this character. Their background and training naturally tend to make them cautious and timid rather than imaginative.'

11. To quash a notification on the ground of the policy being faulty would not be within the realm and power of the Court. The power of judicial review should be exercised with restraint, which serves to maintain the system by preserving the constitutional allocation of powers and by protecting the unique function of the Court.

12. Justifying the imposition of ban on the running of khandsari units, the respondents have given a number of grounds in their counter and supplementary counter-affidavits. To meet this national crisis, the Government of India took a number of steps to increase the production during 1980-81. The Government allowed rebate in basic excise duty on excess sugar production in the months of October-November 1980. This was done with a view to give an incentive to Sugar Mills to start early cane-crushing operations. To supplement this incentive, it was also thought necessary that the sugar factories got the required supplies of sugarcane. On account of certain special conditions under which the sugar factories worked and which disabled them from computing with khandsari units and power crushers in payment of price of sugarcane, the State Government thought of regulating the supply of sugar-cane by prohibiting the owners of power crushers from working their power crushers in the month of October and November.

13. In the year 1978-79 the production in the re-served areas was 578.78 lac tonnes, out of which the percentage of cane supplied to the sugar mills was 27.24 whereas it was 9.73 per cent in case of khandsari and Gur manufactured by power crushers, and 45.53 per cent was utilised by Gur manufacturers. In the year 1979-80, which was a drought year, sugarcane production recorded from 578.78 lac tonnes to 478.11 lac tonnes. Owing- to short supplies of sugarcane, there was keen competition for purchase between sugar mills and khandsari units run by power crushers, as a result whereof the share of sugar mills went down to 21.66 per cent from 27.24 per cent. It was the lowest ever production of sugar in about a decade. On the contrary taking advantage of the shortage of sugarcane, the supply of sugarcane to power crushers went up by 2.06 per cent. i.e., 11.79 per cent. Thus, the policy adopted by the Central Government cannot be said to be one with which any interference is possible by this Court. The petitioner has not alleged that the policy behind the impugned notification was on account of mala fides or lack of bona fides. It is, therefore, not possible to accept the suggestion of the petitioner's learned counsel that if some policy different from that which had been adopted was followed, the result would be brighter, and that there would have been no need to put a ban on manufacture of Khandsari and Gur.

14. From what we have said above it follows that this court can arrest execution of a statute when it conflicts with the Constitution; it cannot run a race of opinion upon points of right, reason and expediency with the law making power. It is impossible for a court to imagine how successful a particular approach may be, what evasions might develop, what new evils might be generated in the attempt. For all these reasons the Courts have always kept a restraint on themselves by persistently taking the view that they should refrain from participating in public policy.

15. Linked with the above, the next argument was that the impugned notification was bad inasmuch as it has been issued on wholly irrelevant and extraneous considerations. Sri Rishiram, learned counsel for the petitioner contended that the sugarcane available for crushing is much more than the need of the factories and the Cane Commissioner issued the notification prohibiting the power crushers from manufacturing gur and khandsari sugar without looking into relevant details and on irrelevant and extraneous considerations. His submission was thatlong before the notification had been issued the Cane Commissioner had relevantmaterial before him showing that thesugarcane produced in the reserved areaof Bijnor factory, where the petitioner'scrusher is situated, is 82.91 lac quintals,whereas the demand of the sugar millsat Bijnor was only 9.50 lac quintals. Onthe basis of these figures counsel urgedthat out of the total production only one-third of the sugarcane produced in thisarea is likely to be utilised by the sugarfactories, while the power crusherswould consume approximately only tenper cent. Hence, even if the powercrushers would have been permitted tocrush for manufacturing gur and khandsari, there still would have been leftsugarcane enough in quantity for miscellaneous uses.

16. The initial burden lay on the petitioner to prove that the necessary opinion which was a condition precedent to the issuance of the notification, had not been formed. Satisfaction of the Cane Commissioner under Clause (8) of the Order is subjective. The validity of the order does not depend upon the recital of the formation of the opinion in the Order, but upon the actual formation of the opinion and the making of the order in consequence. If the reasons for making the order have not been set forth in the notification, the Order cannot be held to be illegal. The defect can be remedied by filing an affidavit when a challenge is made to the validity of the Order, that in fact the Order was made after such opinion had been formed. (See Swadeshi Cotton Mills Ltd. v. State Industrial Tribunal, U. P., AIR 1961 SC 1381).

17. In the instant case detailed counter and supplementary affidavits have been filed giving the various grounds which led to the making of the order. Since these materials on which the notification had been issued were relevant for giving a direction regarding production, and purchase of sugarcane, the notification cannot be held to be illegal. While judging the question of relevancy of the material it has to be borne in mind that the Court does not sit in appeal over the judgment of the authority issuing the same. It has a limited function to discharge. The court cannot go into the adequacy of the material or substitute its own view for that of the authority. As held by the Supreme Court in Jai Chand Lal Sethia v. State of West Bengal (AIR 1967 SC 483) in matters of policy and formation of opinion due deference has to be given to the conclusions of the authority.

18. From paras 6, 7, 8 and 19 of the supplementary affidavit the State Government has established that in order to step up the production and to ensure equitable distribution of sugar at fair price, the Cane Commissioner was satisfied that it was essential for increasing production and supply of sugar and its availability at reasonable price to regulate purchase of sugarcane in such manner that unhealthy competition for sugar-cane between the sugar mill owners and power crushers was avoided to the extent possible without adversely affecting the industries. While issuing the notification the overriding consideration was public interest which was making available sugar to the general public at fair price. The price of sugarcane is chiefly responsible for ultimate cost structure of sugar. If sugarcane is sold at unreasonably high prices, it was likely to lead to price spiral. Thus, the notification was Issued with a view to see that sugarcane is made available to the sugar factories in the initial period of crushing so that sugar could be produced in good quantity and the need could be met to the satisfaction of everybody concerned.

19. From paragraph 9 of the supplementary counter-affidavit it appears that the power crushers are able to pay higher prices for sugarcane on account of certain advantages which they enjoy. In view of certain financial liabilities which are attached with the sugar factories and the constraints, it is not possible for the sugar mill owners to compete with khandsari units in offering higher prices, This has led to a fall in sugar production and premature closure of sugar mills which ultimately upsets the equilibrium between the demand and supply of sugar. Thus, from the affidavits filed between the parties it appears that in order to achieve harmony between the two conflicting interests of the cane growers and the sugar mills on the one hand and the interest of the general public on the other, the Cane Commissioner acted in public interest to issue the notification which is likely to make available the supply of sugar to the public at large at a cheap price.

So far as the figures relied upon by the counsel for the petitioner are concerned it may be relevant to point out that it is not production of sugarcane, but its actual availability to the sugar factories which is relevant for purposes of manufacturing sugar. If for achieving that end, the notification was issued, this court cannot hold the same to be invalid. At this place, it may be relevant to point out that owing to the higher prices offered by the power crushers the sugar mills were not able to secure even half of their requirements. Last year Sugar Mills could purchase only fifteen per cent of the bonded cane and had to close down prematurely. Being satisfied that in the wake of abnormal high prices of gur and khandsari currently, diversion of sugar-cane away from the factories would be formidable and massive, the Cane Commissioner took a realistic view and issued the notifications on materials which were relevant to the controversy in question. In the absence of any allegations that the opinion formed by the Cane Commissioner was either mala fide or lacked bona fide, this court cannot quash the notification on this ground.

20. The next argument of the learned counsel was about the invalidity of Clause 8 of the Sugarcane Control Order. Counsel, attacked the validity of Clause 8 on two grounds : firstly on the ground that the power conferred to give direction contemplated by it was communicated (sic) and uncanalized and, consequently, that it was a piece of legislation bad on account of excessive delegation. Both these grounds are untenable. For the purpose of finding whether the Act is bad on account of excessive delegation, the law settled is that where the Legislature lays down the policy and indicates the rule or the line of action that should serve as guidance to the authority that would be deemed to be sufficient. Such guidance may be obtained from, or afforded by the preamble read in the light of surrounding circumstances which necessitated the legislation taken in conjunction with well known facts of which the courts can take judicial notice. In Organo Chemical Industries v. Union of India, (AIR 1979 SC 1803) the law laid down is :

'Even so, let us examine the ground that in absence of detailed guidelines the law is void. What is not explicit, may still be implicit. What is not articulated at length may be spun out from a single phrase. What is not transparent in particularised provisions may be immanent in the preamble, scheme, purpose and subject matter of the Act. What is real, is not, only the gross, but also the subtle, if I may strike a deeper note.'

If, therefore, the guidelines can be obtained from the various sources mentioned above the law enacted would be valid, being neither a case of excessive delegation nor abdication of legislative authority.

21. In the present case, for finding out the guidelines reference may be made to the preamble of the E. C. Act and Section 3 thereof. Section 3 in itself clearly delineates the purpose and object of issuance of notifications. There are sufficient guidelines under Section 3(1) itself.

22. Dealing with the object of Sugar-cane Control Order, 1966 the Supreme Court held in the case of Indian Sugar and Refineries v. A. S. Co-operative Society, (AIR 1976 SC 775) (at p. 779) that :

'The object of the 1966 Control Order is to promote sugar industries and to eliminate unnecessary impediments in the production of sugar. It also assures a fair deal to the growers of sugarcane. The provisions of the Control Order are intended to maintain harmony between the growers of sugarcane and the producers of sugar, and to enable both of them to share profits reasonably.'

Thus it cannot be said that Clause (8) suffers from excessive delegation or that it is unguided, conferring discretion, wide or arbitrary upon the authorities to issue notification contemplated by it whenever the authorities so desire.

23. Sri Rishiram then urged that the impugned notification amounts to a suspension of licence granted to the petitioner under the provisions of U. P. Restriction on Sugarcane Purchase Order, 1966, counsel urged that the aforesaid Order was also issued under Clauses (5), (6), (7) and (8) of the Sugarrane Control Order referred to above. The provisions contained in the Purchase of Sugarcane Control Order, 1966 being special in nature, providing for the manner in which a licence can be revoked, suspended or cancelled, the general power conferred by clause (8) of the Sugarcane Control Order, 1966, cannot be applied to a situation like the present. In that connection counsel urged that if the Cane Commissioner was satisfied that it was expedient so to do in the public interest with a view to regulating the supply of sugar-cane, or for securing its equitable distribution, the Cane Commissioner could suspend the licence under Clause (8) of Sub-Clause (c) of the Restriction on Sugarcane Purchase Order, 1966. In that connection reference was also made to Clause (7) of the aforesaid Restriction Order which conferred power on the Cane Commissioner from time to time having regard to the availability of sugarcane to vary the period of working hours during which the permit holders could work the power crusher or the Khandsari unit.

24. To us it appears that none of the two Clauses (7) or (8) would apply to the facts of the present case. Clause (7) confers power of regulating the working hours and period of a permit holder with respect to a reserved area. This power can be exercised only in respect of a particular reserved area. Clause (8) is also not applicable, inasmuch as the present is neither a case of suspension, nor cancellation. These provisions apply to situation different than the one contemplated by Clause (8). The power conferred by Clause (8) of the Sugar Cane Control Order operates in a different field; while under the U. P. Order the power is quasi-judicial and exercisable in cases of individual unit owners, the power under Clause (8) of the Control Order is legislative in its nature. The impugned notification may at the most amount to putting the licence in abeyance for a temporary period in order to meet an urgent and grave situation.

25. In Saraswati Industrial Syndicate Ltd. v. Union of India (AIR 1975 SC 460) the validity of the notification dated 28th June, 1967 issued by the Central Government under Clause (7) of the Sugarcane (Control) Order, 1966 fixing ex-factory prices for sugar factories was challenged. Dealing with the nature of the notification the Supreme Court held that price fixation is more in the nature of a legislative measure, even though it may be based upon objective criteria. Thus the submission of the learned counsel that action could have been taken only under the Restriction Control Order is devoid of substance.

26. This leads us to the consideration of the next argument about no opportunity having been given to the petitioner before the notification under clause (8) of the Sugarcane Control Order, 1966 was issued. We have already mentioned above that the notification was a legislative measure. Hence even though it should be based upon objective criteria, the complaint that the rule of natural justice had not been followed cannot be accepted. Principles of natural justice do not require the State Government to give an opportunity to a person likely to be affected by the promulgation of a notification. Thus, this argument must also be rejected.

27. Next was the submission that the granting of exemption in favour of vertical power crushers unreasonably discriminates the petitioners and therefore, violates Article 14 of the Constitution. Burden to prove discrimination lies upon the petitioner. This burden has not been discharged. But before dealing with the merits of this point, it appears necessary to refer to what Article 14? of the Constn. lays down. It is that all persons similarly situated shall be treated alike. Equal laws would have to be applied to all in the same situation, and there should be no discrimination between one person and another, if, as regards the subject matter of the legislation, their position is substantially the same. The classification however, must not be arbitrary. In order to pass the test, two conditions must be fulfilled, viz., (1) that the classification must be founded on intelligible differentia which distinguished those that are grouped together from others and, (2) that the differentia must have a rational relation to the object sought to be achieved by the Act. If the action taken does not classify persons or things on basis which has no rational relation to the object of the legislature, its action can be annulled as offending the equal protection clause.

28. The submission in the present case was that whereas the impugned notification permits a person owning a vertical power crusher, it unreasonably prohibits horizontal power crushers to crush and manufacture gur and khandsari. Counsel's argument was that there was little to differentiate between the two. Hence, picking out the petitioner and restraining him from manufacturing gur and sugar was discriminatory. This submission also has no merit. The vertical power crushers form a class different than the one which horizontal power crushers form. Vertical power crushers consume 40 to 50 quintals of sugarcane per day i.e. 1500 quintals (per month) whereas the horizontal power crusher of 10 x 12 inches and not exceeding 12' x 14' can crush 5600 quintals per month i.e. nearly four times that of the vertical crushers. Vertical crushers are generally owned by cane growers themselves as it is not economic to run the same on commercial basis. They can crush sugarcane grown on their own fields. On the other hand, these horizontal power crushers are commercial units. Two things, therefore, subject to two different things are not similarly situated.

29. Apart from fulfilling the requirements of two different classes, the notification achieves the purpose and object of the Essential Commodities Act and the Sugarcane Control Order, 1966 for achieving the object of which the impugned notification has been issued. The object is to make a fair distribution of the sugarcane so that ultimately sugar is made available to the public at large. This aspect of the matter has already been dealt with by us. It is not necessary to repeat the same and to say that availability of sugarcane to sugar factories is in public interest. This public interest is attempted to be served by checking the diversion of sugarcane to power crushers. The vertical power crushers would consume very little of sugar produced in comparison to horizontal crushers. Hence, the impugned notification has a reasonable nexus with the objective, which was to be achieved by the Sugarcane Control Order.

30. Moreover, even if it was assumed that the exemption made in favour of the vertical power crushers was illegal, the petitioner did not stand to gain. The ban to crush sugarcane in reserved areas would still hold good. In Narain Das v. Improvement Trust, Amrilsar (AIR 1972 SC 865) the Supreme Court held that if some persons have succeeded in getting exemption, no right can accrue in favour of other persons to get similar exemption. This complaint of the petitioner therefore, has no substance.

31. The next submission of Shri Rishi Ram was that the impugned notification placed unreasonable restriction on the right of the petitioner guaranteed by Article 19(1)(g) of the Constn., hence the same was liable to be declared ultra vires. Counsel contended that by imposing a ban on crushing of sugarcane for the period up to 1st Dec. 1980, the Cane Commissioner has imposed a total prohibition which could not be done. The restriction according to the learned counsel was unreasonable. For making out the above point, counsel urged that the impugned notification amounts to suspension of the licence and permit for a period of two months and was also against Clause 8 of the U P. Restriction on Sugarcane Purchase Order, 1966, and Clause 11 of the Control Order, 1966.

32. We do not find any merit in this submission. Clause 8 is a regulatory provision. The notification issued under the aforesaid clause does not prohibit manufacturing of Gur and Khandsari by power crushers altogether. It is intended to be in operation only for a limited period, namely, from 9th Oct. 1980 to 1st Dec. 1980 when diversion of sugarcane to power crushers was apprehended in large measure and the same would have defeated the supply of sugarcane to factories. The notification does not seek to prohibit or even restrict the manufacture of Gur and Khandsari during the rest of the year. We, therefore, find it difficult that the regulation imposed by Clause 8 can be considered as prohibition or restriction. Every regulation generally involves some degree of restriction and even partial prohibition. In Toronto Municipal Corporation V. Vrigo, 1896 AC 88, Lord Davey observed :--

'No doubt the regulation and governance of a trade may involve the imposition of restriction on its exercise both as to time and to a certain extent as to the place where such restrictions are in the opinion of the public authority necessary to prevent the nuisance or for maintenance of order.'

33. A similar controversy came up for consideration before a Full Bench of this court in Suresh Chandra v. State of U. P. (AIR 1977 All 515). In that case, a notification had been issued prohibiting export of milk from a certain area to another. Challenging Clause 2 of the Milk Products Control Order, 1977 the submission made was that as the notification imposed total prohibition, it was invalid. The averment was repelled, and the view taken was that prohibition of export of milk and milk products and prohibition of manufacture of milk products under Clause 2 of the Milk Products Control Order, 1977 could not be considered as ultra vires. It is not correct to say that the word 'restriction' does not include exercise of prohibition also. The contention that a law prohibiting the exercise of a fundamental right is in no case saved was repelled in Narendra Kumar v. Union of India (AIR 1960 SC 430). In such a case, the Supreme Court laid down that when the restriction reaches the stage of prohibition special care has to be taken by the Court to see that the test of reasonableness is satisfied. The greater the restriction, the more the need for strict scrutiny by the Court. In considering the question of reasonableness, the Supreme Court held (at p. 436): 'The Court has to consider the question in the background of the facts and circumstances under which the order was made, taking into account the nature of the evil that was sought to be remedied by such law, the ratio of the harm caused to individual citizens by the proposed remedy, the beneficial effect reasonably expected to result to the general public.........'

34. Applying the aforesaid test, we are unable to find that the impugned notification places any unreasonable restriction which is liable to be quashed.

35. It may be stated here that man does not live by himself and for himself alone. There comes a point in the organization of a complex society where individualism must yield. The present was a problem of a delicate nature and, therefore, the restriction placed on the crushing of sugarcane for producing Gur and Khandsari for a short period has to be upheld as reasonable, even if the same is treated as prohibition or restriction. What may be noted further is that such a notification has not been issued for the first time by the State in this year. It was done in earlier years also. In one of the notifications produced before us which was dated 5th Nov. 1974, in exercise of the powers under Clause 8 of the Control Order, 1966, the Cane Commissioner had directed the power crushers or khandsari units in any reserved area not to work their power crushers or the khandsari units prior to Dec. 10, 1974. Thus, it appears that the impugned notification has not been issued for the first time in this year.

36. Counsel's next argument was that under Clause 8 of the Control Order, 1966, directions can be issued to producers of Khandsari sugar, power crushers, khandsari units, who are manufacturing Gur, Khandsari etc. for commercial purpose and those who have to obtain licence and permits for enabling them to do so. He submitted that since no individual owning land of his own over which he has grown sugarcane is required to obtain any permit or licence, no restriction on him can be imposed under the aforesaid clause. In that connection, Sri Pradeep Kant, learned counsel appearing in one of the connected writ petitions, pointed out that under U. P. Sugarcane Purchase Act, 1953 the factories are entitled to purchase only bonded sugarcane in respect of which agreements have been entered into between the farmers and the sugar factories or their agents. According to him, as there is no right to compel a person to sell unbonded sugarcane, the restriction imposed by Clause 8 on such person would be irrational and also against the ambit of Clause 8.

37. Clause 8 does not make any distinction between self-grown sugarcane crushers and those who purchase it for crushing from the market. Under this clause, period or hours of working can be regulated irrespective of the fact that the owner of a crusher or khandsari unit crushes his own sugarcane or does the same after purchasing it from the open market. This power of Clause 8 has to be read with Section 3 of the E. C. Act. Reading the same in the light of the objects for which the said Act was enacted and Section 3 itself, it would be found that for achieving the object it is not necessary that restrictions could be imposed only on persons other than those who grow their own sugarcane and intend to crush the same. Under Section 2(b) of the Essential Commodity (sic). Thus, the Cane Commissioner is fully empowered to regulate the supply, distribution and production of this essential commodity. This power cannot be hedged in by confining its operation to the persons other than those who grow their own sugarcane. The language employed is wide enough to include persons who grow their own sugar-cane and manufacture Gur and Khandsari. If a restricted meaning is given to Clause 8 confining it to persons pointed out by the petitioner's learned counsel, the very purpose of making Clause 8 might be defeated. Section 3 of the E. C. Act confers power to make orders regulating or prohibiting the production, supply and distribution of essential commodities and trade and commerce therein. Clause 8 was directed to achieve the aforesaid purpose. The present notification was issued by the Cane Commissioner for maintaining or increasing the supply and securing equitable distribution and availability of sugarcane at fair price.

38. That apart, the argument of permitting self-grown sugarcane is liable to be repelled also on the ground that for enforcing the order directing power crushers who purchase sugarcane from the market and crush the same for producing Gur and Khandsari, it was essential that a restriction was imposed on others owning their own sugarcane, otherwise the very object intended to be achieved by Clause 8 could not be achieved. It is not possible to differentiate sugar-cane that is claimed to have been grown in the fields belonging to the power crusher owner himself and that purchased from the market. If the operation of the notification is confined only to sugar-cane purchased from the market, evasions of the notification might take place and new evils might be generated which may not be capable of being detected. Therefore, speaking from the point of administrative convenience it was impos-sible to exempt the crushing of sugarcane grown by the cane growers owning power crushers. In State of Gujarat v. Shri Ambika Mills (AIR 1974 SC 1300), it has been held by the Supreme Court that any restriction on the ground of administrative convenience is reasonable.

39. From the figures given in the counter-affidavit it is established that a person owning a power crusher cannot run it purely on the basis of supplies received from his own fields. In U. P. the maximum area to which a person is entitled to possess under the U. P. Imposition of Ceiling on Land Holdings Act is 7.30 hectares. The average yield per acre varies from 8 to 14 tonnes of sugar-cane, whereas the capacity of power crushers of 10' x 12' is 5600 quintals per day. Therefore, one who intends to run a power crusher has to fall back upon the supplies received from the market. Assuming that every power crusher owns 7.30 hectares of land, which is not the case of the petitioner nor has been alleged in the writ petition, the cane grown by them could hardly be sufficient for crushing for three or four days. Thus, in the garb of this exemption, the petitioner wants to purchase sugarcane from the market and set at naught the legislative purpose and intent of the notification. The restriction placed is to last for a short duration. By that time, the sugarcane would gain further maturity and it would then be more advantageous for these persons to crush the same.

40. It was further faintly contended that before issuing the notification, the Cane Commissioner ought to have taken steps under Clause 7 of the Sugarcane (Control) Order, 1966. The submission has no substance. Clause 7 deals with entirely different matters. It applies only when a licence is issued and conditions are attached to that licence by the Central Government or its delegates. It is general and administrative in nature. On the other hand as already pointed out above, the power under Clause 8 is special which is exercisable from time to time, in order to meet different situations. It has an overriding effect. So, this argument also has no substance.

41. The last point argued was that there was no valid delegation of power under Clause 8 of the Control Order, 1966 inasmuch as no notification has been issued under Section 5 of the E. C. Act. This submission also has no merit. There are two provisions under which power could be delegated, namely, under Clause 11 of the Control Order, 1966, and Section 5 of the E. C. Act. Both the provisions are in similar language. Annexure A-2 to the counter-affidavit is the notification sub-delegating the powers to the Cane Commissioner. Thus, there can be no complaint that there had been no delegation of power in favour of the Cane Commissioner. It is significant to mention here that under both the provisions, viz., Clause 11 of the Control Order, 1966, and Section 5 power is exercisable only by the Central Government. The procedural requirement for publication of gazette notification is common to both. Hence, the Central Government is duly empowered to delegate to the Cane Commissioner the powers exercisable under Clause 8 of the Control Order, 1966.

42. From that we have said above, it follows that the sub-delegation in favour of the Cane Commissioner has been established by Annexure A-2. The delegation, although was made under Clause 11, but could be treated as to be under Section 5 of the E. C. Act as well inasmuch as if an authority is competent to do certain actions, mere recitation of a wrong provision would not invalidate the exercise of that power. (See Vice Chancellor, Jammu University v. D. K. Rampal, AIR 1977 SC 1146).

43. The judgment in the present case was pronounced on 12-11-1980 for the reasons to be given subsequently. Reasons have now been given by us for dismissing the writ petition on the aforesaid date. These reasons shall form part of the judgment.


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