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Madhya Pradesh Ration Vikreta Sangh, Jabalpur and ors. Vs. State of Madhya Pradesh, Bhopal and anr. - Court Judgment

LegalCrystal Citation
SubjectConstitution
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. Nos. 723, 741 etc. of 1980 and 1, 12 etc. of 1981
Judge
Reported inAIR1981MP203
ActsEssential Commodities Act, 1955 - Sections 3, 3(1), 3(6) and 5; Madhya Pradesh Foodstuffs (Distribution) Control Order, 1960; General Clauses Act, 1897 - Sections 21 and 27; Constitution of India - Articles 14, 19(1), 39, 162 and 226
AppellantMadhya Pradesh Ration Vikreta Sangh, Jabalpur and ors.
RespondentState of Madhya Pradesh, Bhopal and anr.
Appellant AdvocateV.S. Dabir, ;N.C. Jain, ;Fakhruddin and ;C.L. Kotecha, Advs.
Respondent AdvocateA.M. Mathur, Adv. General and ;M.V. Tamaskar, Govt. Adv.
DispositionPetitions dismissed
Cases ReferredHrudananda v. Revenue Divisional Commissioner
Excerpt:
- - that the appointed agent should have satisfactory financial condition so that he may carry out the obligations laid on him under the scheme and that he must not be an adjudicated insolvant and must be of good character and must not have been convicted of an offence and must not be of unsound mind. it still remained an order made by the state government and, therefore, the state government could amend or vary that order in exercise of its delegated power under section 3 read with section 5. as it was not obligatory under the delegation to obtain concurrence of the central government, the order dated 30th october 1980 amending the 1960 control order is perfectly valid, although no concurrence of the central government was obtained before its making. when section 5 enables the central.....g.p. singh, c.j.1. this order shall also dispose of misc. petitions nos. 741, 758, 759, 763, 768, 771, 774, 783,787, 796, 797, 800, 802, 803, 810, 813, 817, 831, 833, 837, 840, 844, 846, 847, 848, 858 and 871 all of 1980 and misc petitions nos. 1, 12, 16, 38, 91, 105, 166, 169, 202, 322, 339 and 362 all of 1981.2. petitioner no. 1 in m. p. no. 723 of 1980 is madhya pradesh ration vikreta sangh, a registered society representing the interest of ration shop holders at the state level in madhya pradesh. the other petitioners in this petition and other petitions are ration shop holders or their societies or associations at different levels. ration shop holders are retail dealers appointed under clause 3 of the madhya pradesh foodstuffs (distribution) control order. 1960, hereinafter referred.....
Judgment:

G.P. Singh, C.J.

1. This order shall also dispose of Misc. Petitions Nos. 741, 758, 759, 763, 768, 771, 774, 783,787, 796, 797, 800, 802, 803, 810, 813, 817, 831, 833, 837, 840, 844, 846, 847, 848, 858 and 871 all of 1980 and Misc Petitions Nos. 1, 12, 16, 38, 91, 105, 166, 169, 202, 322, 339 and 362 all of 1981.

2. Petitioner No. 1 in M. P. No. 723 of 1980 is Madhya Pradesh Ration Vikreta Sangh, a registered society representing the interest of ration shop holders at the State level in Madhya Pradesh. The other petitioners in this petition and other petitions are ration shop holders or their societies or associations at different levels. Ration shop holders are retail dealers appointed under Clause 3 of the Madhya Pradesh Foodstuffs (Distribution) Control Order. 1960, hereinafter referred to as the 1960 Control Order, for running ration shops set up by the State Government under a Government Scheme.

3. The 1960 Control Order was made by the State Government under Section 3 of the Essential Commodities Act. 1955. in the exercise of its delegated power under Section 5 of the Act. Clause 2 (a) defined 'appointed retailer' to mean a retail dealer appointed under Clause 3 in respect of any foodstuff. Clause 2 (d) defined 'Government Scheme' to mean a Scheme for distribution of foodstuffs to consumers through fair price shops set up by the Government in this behalf. Clause 3 (1) provided that with a view to distributing foodstuffs under the Government Scheme, the Collector may, by order, appoint in respect of any area any person as a retail dealer in respect of any foodstuffs for the purpose of this Order and thereupon such retail dealer shall be entitled to supply in accordance with the provisions of this Order such foodstuffs within such area. The Collector was given power to amend, vary, suspend or rvoke any appointment, if, in his opinion, it was in the interest of the general public necessary or expedient so to do. Clauses 11 to 15 dealt with the manner of working of an appointed retailer. The retailer was to obtain supply of foodstuffs from such wholesale dealer as the Collector may. in this behalf, appoint on indents placed by him with the Collector. The retailer was to deposit the price of foodstuff allotted to him by the Collector, and was required to take delivery of the foodstuffs from Government godowns or from a wholesale dealer against delivery permits. The retailer was required to sell the foodstuffs to consumers in such quantities and at such rates as may be specified in the orders made from time to time by the Government. The 1960 Control Order also provides in Clauses 5 to 10 for issuance of ration cards to families. The appointed retailer was to supply foodstuffs to the holders of the family cards. Provisions requiring the appointed retailer to sell to the family card holders and to maintain accounts etc. were made in Clauses 16 to 22. Briefly stated, the 1960 Control Order was designed to enable the State Government to distribute foodstuffs at fair prices to consumers through fair price shops set up by it. The appointed retailers were to run these shops. The price at which foodstuffs were supplied for fair price shops and at which they were sold by the appointed retailers were fixed by the Government which left a small margin of profit or commission to the appointed retailers.

4. On 28th October. 1980 a wireless message was sent to the Collectors intimating the Government's decision that the appointment of retail dealers was to be excluded from the purview of the 1960 Control Order with effect from 1st November, 1980 and that such retail dealers will thereafter function under executive orders. The Collectors of the Districts were given power to appoint new retailers and to suspend or cancel their appointments. They were also instructed to give preference to co-operative societies in making such appointments. In pursuance of the policy contained in this wireless message, the Government issued the Order dated 30th October, 1980 under Section 3 of the Essential Commodities Act amending the 1960 Control Order. The important amendments made by this Order were that Clauses 3, 4, 11 to 16, 18 to 24 and 36 were omitted. These clauses dealt with appointment and functioning of retail dealers for running fair price shops under the Government Scheme.

5. It was at this stage that the petitioners filed the present petitions under Article 226 of the Constitution challenging the Government decision communicated to the Collectors by wireless message on 28th October. 19SO and the amendments made in the 1960 Control Order, by Order dated 30th October, 1980. Bv interim orders passed in these petitions status quo was directed to be maintained.

6. During the pendency of these petitions, the Government made a Scheme for distribution of foodstuffs through fair price shops under Clause 2 (d) of the 1960 Control Order by notification dated 20th March, 1981. The petitioners in M. P. No. 723 of 1980 by rejoinder which was adopted by other petitioners, also challenged the validity of the Scheme so made by the Government. We have already noted that Clause 2 (d) defines 'Government Scheme' to mean the scheme for distribution of foodstuffs to consumers through fair price shops set up by the Government in this behalf. By the amendments made in the 1960 Control Order by Order dated 30th October. 1980, Clause 2-BB was added to define 'fair mice shop' to mean a shop set up by the Government under the Government Scheme. Clause 3 (1) of the Scheme provides for setting up of fair price shops by the Collectors in each district The guidelines for this purpose are given in Clause 3 (2). Briefly stated, one fair price shop is to feed a population of nearly 2000 and care has to be taken that no consumer may have to travel more than five kilometers for reaching a fair price shop. Clause 4 of the Scheme deals with appointment of agents for running fair price shops. Clause 4 (1) specifically declares that the agent will have no legal ownership of the fair price shop. Clause 4 (2) gives guidelines which a Sub-Divisional Officer has to follow in the appointment of agents. The first guideline is that co-operative societies are to be given first preference. If there is a co-operative society in an area a written refusal has to be obtained before appointing another person as agent in respect of the fair price shop for that area. The other guidelines contained in Clause 4 (2) are that applications will be invited for appointment of agents and the applications received will be considered on merits; that in case of two applicants of equal merit, appointment would be made of the applicant whose application is received first; that the appointed agent should have satisfactory financial condition so that he may carry out the obligations laid on him under the Scheme and that he must not be an adjudicated insolvant and must be of good character and must not have been convicted of an offence and must not be of unsound mind. Further, an applicant who carries on his independent business in the foodstuffs which are to be distributed through the agency of fair price shops, cannot be appointed as agent. The agent appointed by the Sub-Divisional Officer has to enter into an agreement with the State Government as required by Clause 5 for runnine the fair price shop and has to deposit certain amount as security. A co-operative society appointed as agent is not required to deposit any security, Clause 6 provides that the agent will obtain the supplies of foodstuffs for the fair price shop from such agencies as may be directed by the Collector. It also provides that the agent will sell the foodstuffs only to a person holding ration card or permit and the quantity sold will be entered in the ration card. Clause 7 regulates the size of fair price shops and the time when they are to remain open. Clause 8 provides that the agents will be paid commission and other expenses at the rates fixed by the Government. Clause 9 requires the agent to maintain registers as may be directed by the State Government. Clause 10 provides for displaying a board on the shop specifying the price 0f foodstuffs, their quantity etc. Clause 11 requires the agents to send quarterly returns to Collectors. Clause 12 provides that the agents will follow the directions issued from time to time by the State Government and other authorities. Clause 13 deals with penalties. In case an agent is found to have contravened any condition of the agreement, his appointment can be suspended or cancelled. Clause 14 makes provision for an appeal against order? made under the scheme by Sub-Divisional Officers to an authorised officer.

7. The effect of the chanfies brought about by deleting from the 1960 Control Order all provisions relating to appointed retailers and by framing of a new scheme for appointment of agents for running fair price shops is that the petitioners who were appointed retailers under the Control Order ceased to have any authority to run fair price shops which will now be operated by the agents appointed under the Scheme. It is for this reason that the petitioners in these petitions challenge the validity of the amendments made in the 1960 Control Order by Order dated 30th October 1980 and the scheme made on 20th March. 1981.

8. The first contention of the learned counsel for the petitioners is that the Order dated 30th October 1980 passed by the State Government amending the 1960 Control Order is invalid and void as it was made without the concurrence of the Central Government. It is argued that the 1960 Control Order was made by the State Government in exercise of its delegated power under Section 5 of the Essential Commodities Act with the concurrence of the Central Government and, therefore, any amendment of that Order could only be made with the concurrence of the Central Government. Learned counsel in this connection referred to Section 21 of the General Clauses Act. 1897.

9. Section 3(1) of the Essential Commodities Act. 1955. confers power on the Central Government to make orders for regulating or prohibiting the production, supply and distribution of an essential commodity and trade or commerce therein if it is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies or for securing equitable distribution and availability at fair prices etc. The Order so made may provide for the matters enumerated in Sub-section (2) of Section 3. Section 5 of the Act empowers the Central Government to delegate the power to make Order or issue notifications under Section 3 in relation to such matters and subject to such conditions as may be specified by it to (a) such officer or authority subordinate to the Central Government, or (b) such State Governments or such officers or authority subordinate to State Governments, as may be specified. The Central Government delegated the power to the State Governments under Section 3 by notification No. G. S. Rule 1088 dated 15th November 1958. It was in exercise of that power that the 1960 Control Order was made by the State Government. The delegation made to the State Governments by the said notification required concurrence of the Central Government only in respect of Orders made by the State Governments in relation to the matters covered by Clause (a) of Section 3(2) or in regard to regulation of transport specified in Clause (d) of the said section. The 1960 Control Order did not relate to these matters and, therefore, concurrence of the Central Government was not needed, still concurrence was taken as a matter of abundant caution. The notification No. G. S. Rule 1088 dated 15th November. 1958 issued under Section 5 was superseded by subsequent notifications. The relevant notification under Section 5 which was in force at the time when the State Government issued its Order dated 30th October. 1980 amending the 1960 Control Order is G. S. R. 800 dated 9th June 1978. Concurrence of the Central Government under this notification is needed when the Order to be made relates to any matters specified in Clause (a), (c) or (f) of Sub-section (2) of Section 3, or in regard to distribution or disposal of foodstuffs to places outside the State or in regard to regulation of transport of any foodstuffs under Clause (d) of the said sub-section. It is not disputed that neither the 1960 Control Order nor the amendments made therein by the Order dated 30th October. 1980 relate to any of these matters and so concurrence of the Central Government was not necessary for making these Orders in accordance with the delegation of powers made by the Central Government. The argument merely is that as concurrence of the Central Government was taken while making the 1960 Control Order, even though it was not needed, it could not be amended without such concurrence. In our opinion, this argument cannot be accepted. The power to make an order under Section 3 of the Act in respect of matters covered by the 1960 Control Order de-legated to the State Government under Section 5 does not require concurrence of the Central Government. The concurrence of the Central Government taken before making the 1960 Control Order was wholly unnecessary as to the validity of the Order. The concurrence taken by the State Government in such a situation does not debar the State Government from modifying the said Order in exercise of its delegated power under Section 3 read with Section 5 without obtaining the concurrence of the Central Government. Section 21 of the General Clauses Act has no application here. The principle under that section would have applied had it been necessary to obtain the concurrence of the Central Government for making an order relating to the matters covered by the 1960 Control Order. As such concurrence was not necessary, absence of concurrence for amending the 1960 Control Order does not make the amendments invalid. The concurrence given by the Central Government before the making of the 1960 Control Order did not make that Order an Order made by the Central Government. It still remained an Order made by the State Government and, therefore, the State Government could amend or vary that Order in exercise of its delegated power under Section 3 read with Section 5. As it was not obligatory under the delegation to obtain concurrence of the Central Government, the Order dated 30th October 1980 amending the 1960 Control Order is perfectly valid, although no concurrence of the Central Government was obtained before its making.

10. The second contention raised by the learned counsel for the petitioners is that formation of opinion under Section 3 of the Essential Commodities Act which is necessary for making an order under that section, could not have been delegated and was not delegated under Section 5 to the State Government. The formation of opinion under Section 3 by the Central Government is a condition or restriction for exercise of the power under that section. When Section 5 enables the Central Government to delegate its power under Section 3 to the State Government, it clearly means that the delegation will necessarily carry with it the condition or restriction for the exercise of the powers. It is. therefore, wholly incorrect to say that the formation of opinion necessary for exercise of the power under Section 3 could not and was not delegated to the State Government under Section 5. Similar delegations under different statutes have been upheld in a number of cases; see Mungoni v. Attorney General of Northern Rhodesia, 1960 AC 336: Sved Shah v. Commissioner of Wakfs. AIR 1961 SC 1095: State of Bombay v. Shivabalak, AIR 1965 SC 661 and Khambhalis Municipality v. Gujarat State. AIR 1967 SC 1048.

11. It was then contended that the scheme made by the State Government by Order dated 20th March. 1981 suffers from sub-delegation. It is argued that the State Government could have made these provisions is an order made under Section 3 read with Section 5 of the Essential Commodities Act as was the position under the 1960 Control Order before its amendment. but it has no power to make a scheme for distribution of foodstuffs under Clause 2 (d) of the Control Order.

12. We have already noticed that Clause 2 of the 1960 Control Order which still continues after the amendment, defines a Government Scheme to mean a scheme for distribution of foodstuffs to consumers through fair price shops set up by the Government in this behalf. The 1960 Control Order, as initially made, covered two matters, namely. (1) appointment of retail dealers for running fair price shops of the Government, and (2) issuance of family ration cards. By the amendments made by Order dt. 30th October. 1980 the matter relating to apointment of retail dealers for running fair price shops has been taken out from the Control Order. The Control Order as it now stands only covers the matter relating to distribution of family ration cards. The scheme made by the Government by Order dated 20th March. 1981 not deals with the setting up of fair price shops but also with the appointment of agents for operating these shops. The argument of the learned counsel assumes that the Government Scheme for setting up fair price shops and appointment of agents for their operation can be made only in exercise of the power conferred by Section 3 of the Essential Commodities Act. The executive power of a State as provided in Article 162 of the Constitution extends to the matters with respect to which the Legislature of the State has power to make laws. The topic of distribution of foodstuffs is covered by Entry 33 in List III of the 7th Schedule and so the executive power of the State extends to this topic. The Government can, therefore, make a scheme for distribution of foodstuffs through its fair price shops in exercise of its executive power without resort to any legislation provided the same is not inconsistent with any provision of law. Section 3 of the Act may enable the making of such a scheme by statutory orders, but it is not necessary that the scheme must be made in that manner. In the absence of any provision in the Act or in the Orders made thereunder that no such scheme can be made by the State Government in the exercise of its executive power, the Government can make such a scheme without recourse to any statutory power purely in the exercise of its executive power. Till the 1960 Control Order contained the provisions relating to the appointment of retail dealers for operating fair price shops set up by the Government, no executive power could be exercised for making a parallel scheme for operating fair price shops through agents as that would have contravened the provisions of the the Control Order. But after the Control Order was amended and the matter relating to the appointment of retail dealers was taken out of its purview, there was left no impediment for the exercise of the Government's executive Dower to make a scheme for appointment of agents to operate fair price shops. The scheme is thus not made in the exercise of any power conferred by the Control Order. Clause 2 (d) of the Control Order only defines the expression 'Government Scheme' and it does not confer any power to make a scheme. The definition itself postulates that the Government Scheme is one which is made in the exercise of its executive power. It cannot therefore be said that the scheme is made in the exercise of any sub-delegated power under the 1960 Control Order, The argument that the scheme suffers from the vice of sub-delegation must, therefore, fail.

13. It was then contended that the Order dated 30th October. 1980 amending the 1960 Control Order and the Scheme made on 20th March, 1981 are bad for the reason that they were not laid before Parliament as required by Section 3(6) of the Essential Commodities Act. This contention is also without any merit. Section 3(6) provides that every order made under Section 3(1) by the Central Government or by any officer or authority of the Central Government shall be laid before both Houses of Parliament as soon as may be after it is made. The Order made by the State Government on 30th October, 1980 amending the 1960 Control Order is not an order made by the Central Government or by any officer or authority of the Central Government, The laying retirement of Section 3(6) has, therefore, no application to such an order. We have already seen that Section 5 empowers the Central Govern-ment to delegate its power under Section 3 in favour of (a) such officer or authority subordinate to the Central Government, or (b) such State Government or such officer or authority subordinate to State Government, as may be specified in the Order of delegation. The laying requirement in Section 3(6) is applicable only in case of orders made by the Central Government and officers or authorities subordinate to the Central Government. Section 3(6) has no aplication when an order is made by the State Government or an officer or authority subordinate to it. Further the laying requirement under Section 3(6) is affirmative in nature. Even if there is non-compliance of such a laving requirement, the order made becomes operative even though it is not laid and the omission to lay order has no effect on its validity. See Atlas Cycle Industries Ltd. v. State of Haryana, AIR 1979 SC 1149. As regards the scheme made on 20th March. 1981, there is an additional ground that it was not made in exercise of the power conferred by Section 3 read with Section 5 of the Act and was made in exercise of the executive power of the State. The laying clause, therefore, had no application to the scheme.

14. It was then contended that the scheme creates a monopoly in favour of co-operative societies and that such a monopoly is violative of petitioners' fundamental rights under Articles 19(1)(g) and 14 of the Constitution.

15. Before considering this contention, we have to take into account the real nature and character of the scheme and the status of agents appointed under it for running fair price shops. As already noticed, the scheme directs the Collectors to set up fair price shops for distribution of foodstuffs at fair prices to consumers holding ration-cards or permits. The agent appointed under Clause 4 of the Scheme has no ownership of these shops. His status is merely of an agent to run the shop under an agreement entered into with the State Government. The agent gets merely a commission as provided in Clause 8. The formulation and implementation of a scheme relating to fair price shops for distribution of foods-stuffs to consumers at fair prices in days of scarcity which we are facing these days is an important Governmental activity of a welfare State. The fair price shops are established by the Government. The Government can operate them by appointing its own servants. Under the scheme as framed. these shops are operated by agents who enter into agreement with the Government. No person has a fundamental right to be appointed as an agent of the Government for running the Government shops. It is open to the Government to devise a reasonable policy for appointment of agents. The only thine necessary is that in making appointments of agents there should be no discrimination violative of Article 14. In this background. there is no question of infraction of Article 19(1)(g) as the petitioners have no fundamental right to carry on business as agents of fair price shops set up by the Government. The petitioners' fundamental right to carry on business in foodstuffs is not restricted by the scheme. The normal wholesale and retail business in foodgrains is regulated by the M. P. Foodgraings Licensing Order 1964. The petitioners can apply for and obtain licences under that order for carrying on wholesale or retail business. The 1960 Control Order and the scheme made by the Government on 20th March. 1981 have nothing to do with the general retail or wholesale business in foodstuffs. The 1960 Control Order and the scheme are restricted to the distribution of foodstuffs to ration-card holders from Government ration shops. In dealing with Clause 3 of the 1960 Control Order before its amendment, a Division Bench of this Court in Radha Kishan Ahuja v. The Collector. Raipur. M. P. No. 414 of 1973. D/- 13-3-1974. observed as follows :

'Learned counsel for the petitioners then contended that the Collector was wrong in stating that the appointment of a dealer is a privilege which can be withdrawn. He submitted that the petitioners have a fundamental right to carry on business in foodstuffs and their appointment as retailers cannot be said to be grant of a privilege. The formulation and implementation of a scheme of rationing for equitable distribution of foodffrains to consumers in days of scarcity is a vary important Governmental activity of a welfare State See : Director of R. & D. v. Corporation of Calcutta. AIR 1960 SC 1355 at pp. 1361. 1363, 1364, The Government may implement a scheme of rationing either by opening its own ration shops or by appointing other persons as retail dealers for distribution of foodstuffs. The scheme under Section 3 of the Control Order is that there will be a Government scheme for distribution of foodstuffs to consumers through fair price shops and that any person may be appointed as a retail dealer for the purpose of distribution of food stuffs to the ration card holders. No person has a right to be appointed as a retail dealer and it is left to the Collector to appoint any person as a retail dealer. As already observed, the appointment as a retail dealer can be revoked by the Collector. No person has a fundamental right to implement a scheme of distribution of foodstuffs formulated by the Government. The Control Order does not restrict the ordinary right of a citizen to carry on business in foodstuffs: it provides the method of implementation of a Government scheme of rationing. In this background, we are of opinion that appointment of a person as a dealer under Section 3(1) of the Order is more in the nature of privilege which can be withdrawn under Section 3 (2).'

These observations strongly support our conclusion that the petitioners' fundamental rights to carry on business under Article 19(1)(a) has not been restricted or affected by the amendment of the 1960 Control Order or by the scheme it made on 20th March 1981.

16. The next question is whether the petitioners' fundamental right under Article 14 has in any way been infringed. Article 14 permits a reasonable classification. Clause 2 of the scheme directs that a co-operative society be appointed as agent for running fair price shops in preference to others. It is only when the co-operative society in the area concerned refuses to accept the appointment as agent that any other person can be appointed as agent. Although Clause 2 refers to co-operative societies in general, it is reasonable to assume in the context of the scheme that the intention is to refer to Consumers' Cooperative Societies and not all types of co-operative societies. A contrary construction would lead to absurd results. For example, if a co-operative society is constituted for carrying on motor transport business, it cannot be held that the intention of Clause 2 was to make such a society agent of the Government for running a fair price shop under the scheme. Indeed, the learned Advocate General conceded before us that by a co-operative society in Clause 2 is meant only a consumers' co-operative society and it is only to these societies that preferential rights of be-coming agent is given by the scheme. So the position boils down to this that the scheme seeks to prefer consumers' co-operative societies in the matter of appointment of agents for running fair price shops. It is only when such societies refuse to accept appointment as agent that others can be considered for appointment. Consumers' Co-operative Societies stand as a class from others. There is a reasonable basis for the Government policy that as far as possible consumers' co-operative societies should be appointed as agents. As observed by the Supreme Court in Narendra Kumar v. Union of India. AIR 1960 SC 430 at p. 437 it has been the endeavour at least in modern times for those responsible for social control to keep middlemen's activities to the minimum and to replace them largely by co-operative sale societies of producers and co-operative purchase societies of the consumers. In Gonal Brothers v. Slate of M. P., M. P. No. 266 of 1980. decided on 22nd September. 1980 and Kuldeep Mehra v. State of M. P., M. P. No. 261 of 1980. decided on the same date, it was held by a Division Bench of this Court that a favoured treatment given to co-operative societies in relation to sale of Sal-seeds did not violate Article 14 of the Constitution. In that connection it was observed that co-operative societies help to promote co-operative movement in furtherance of the directive principles contained in Article 39 of the Constitution and that co-operative society is clearly in a category distinct from a private trader who carries on business only for individual gains with no benefit accruing to the society in general. In our opinion, the preference given to cooperative societies by Clause 2 of the scheme does not create unreasonable classification and is not violative of Article 14 of the Constitution.

17. Learned counsel for the petitioners relied upon Mannalal Jain v. State of Assam, AIR 1962 SC 386; Ramanlal v. M. S. Palnitkar. AIR 1961 Guj 38: District Collector. Hyderabad v. Ibrahim and Co., AIR 1966 Andh Pra 310 and Hrudananda v. Revenue Divisional Commissioner. AIR 1979 Orissa 13 to support their argument that grant of monopoly to a co-operative society violates the petitioners' fundamental rights under Article 19(1)(g) of the Constitution. Mannalal Jain's case related to Assam Food Grains (Licensing and Control) Order. 1961. It was held in that case by a majority of three against two that grant of licences to co-operative societies with a view to create monopoly in their favour violated Article 19(1)(g) of the Constitution. Now. the Assam Control Order dealt with by ihe Supreme Court in Mannalal Jain's case prohibited any business in rice and pad-dy in wholesale without a licence. The denial of licence under the Control Order to the petitioners in that case and grant of the same in favour of co-operative societies deprived the petitioners of their right to carry on wholesale business. It is in this context that it was held that a monopoly was created in favour of co-operative societies which was not saved by Article 19(6). The position in the instant case is entirely different. Here, as already pointed out, the petitioners are free to carry on retail or wholesale business in foodstuffs by obtaining licences under the M. P. Foodgrains Dealers Licensing Order, 1965. The petitioners have no fundamental right under Article 19(1)(a) for operating fair price shoos set up BY the Government for distribution of foodstuffs to ration card holders. As the petitioners have no fundamental right to run Government ration shops, there is no question of violation of any fundamental right under Article 19(1)(g). The other cases relied upon in this context which have been mentioned above are also distinguishable on the same basis. In Ramanlal's case, the Guiarat High Court held that the action of the State Government under the Essential Commodities Act in entrusting wholesale distribution of sugar to co-operative societies to the exclusion of other licence holders was violative of Article 14 of the Constitution. It would be noticed that in Ramanlal's case because of - the Government policy the other licence holders were deprived to carry on any wholesale business in sugar which they were entitled to do under the Bombay Sugar Dealers Licensina Order, 1959. As explained above, the petitioners are not deprived of their right to carry on any retail or wholesale business in foodstuffs by obtaining licences under the M. P. Foodgrains Dealers Licensing Order. 1984. The Government scheme only deprives them to become agents of the Government for running Government ration shoos. Ramanlal's case is, therefore, distinguishable in the same manner as the decision of the Supreme Court in Mannalal Jain's case. The Andhra Pradesh case of District Collector, Hvderabad v. Ibrahim and Co. (supra) also related to grant of monopoly of sugar distribution to a co-operative society violating the rights of other businessmen under Article 19(1)(g) of the Constitution. For the reasons al-ready given, the case has no application here. In the Orissa case of Hrudananda v. Revenue Divisional Commissioner (Supra), monopoly was created in the matter of grant of quarry lease which violated the rights of the petitioners in that case to carry on quarrv business. This case is also of the same category and is not applicable to the facts of the instant case.

18. It was then contended that the order dated 30th October. 1980 amending the 1960 Control Order and the Scheme dated 20th March 1981 were made with a mala fide intention of ousting all existing appointed retailers. Reference in this connection is made to certain statements and speeches made in November. 1980 by the Minister of State for Civil Supplies which were published in newspapers and which are exhibited collectively as Annexure A in Misc. Petition No. 723 of 1980. It is stated in these speeches that the previous Government, meaning thereby the Janta Government, appointed R. S. S. persons as retail dealers who corrupted the distribution system. The Minister who was joined as a party has not filed any return. The return filed by the State, however, says that the amendment of the 1960 Control Order and the Scheme were to improve the distribution system of food-grains through fair price shops and that there was no political motive behind the Government action. It is further stated that the Minister of State concerned is a political person and may have made political statements but the Government has no political motive behind the impugned scheme. The return of the State Government does not support the alleged statement of the Minister of State that the distribution system set up under the Janta Government was entrusted to R. S. S. men and, therefore, it was necessary to change the system. The stand of the Government is that the new scheme of distribution is only with a view to improve the working of the distribution system and not to benefit any political party. It is a matter of regret to see a Minister making statements which cannot be supported by the State Government. We are, however, satisfied that the new scheme made on 20th March. 1981 is not made with the obiect to benefit any political party. As already noticed, cooperative societies are to be preferred for appointment as agents and unless a co-operative society refuses to become an agent, no other person can be appointed agent. It cannot be assumed that co-operative societies in general have leanings in favour of a particular party. The policy under the scheme to Hive preference to co-operative societies has. therefore, no political motive behind it. The amendments made in the 1960 Control Order were approved by the Chief Minister. The scheme was also prepared in consultation with him.

The Minister of State, no doubt, had a part to play in formulation of the new scheme which was finally approved by him, yet we are not prepared to hold, having regard to the terms of the scheme, that there was any political motive behind it. The Minister of State may have made certain statements just for the consumption of his supporters in the public. The statements so made cannot be seriously taken. At any rate, as we are satisfied that there was no political motive behind the scheme, the argument of male fides must be negatived.

19. It was lastly contended that the scheme under the 1960 Control Order as it stood before its amendment was more in favour of weaker sections of the society and for this reason the new scheme is bad. In this connection reference is made to the order of the Government dated 23rd August 1978. By this order, the Government gave directions in the matter of appointment of approved retailers. Co-operative societies, educated unemployed, retired military personnel and their dependents, freedom fighters, members of Scheduled Castes and Scheduled Tribes etc. were to be preferred in the matter of appointment of retailers in the order in which they are mentioned. So far as the present scheme is concerned, co-operative societies stand at a much higher footing, for it is only when the co-operative society in the area of the shop declines to become an agent that the question of selection of other persons arises. The other categories which were mentioned in the order of 1978 are not mentioned in the scheme for being given a preferential treatment. The omission in that behalf cannot make the scheme invalid. The Sub-Divisional Officer has to select-the best person amongst the applicants for appointment as agent for running a fair price shop in case no co-operative society is available. Reference was made in the course of argument to directive principles of State Policy. The provisions in Chapter IV of the Constitution which contain the directive principles, are not enforceable and non-adherence to them cannot make a Government action invalid. In our opinion, the impugned scheme cannot be declared invalid by showing that the Government Order of 23rd August 1978 was more in favour of weaker sections of the society.

20. Before concluding, we must state that we hope that the implementation of the new Scheme would be fair and impartial and the Sub-Divisional Officers would be left free to appoint agents in terms of the scheme without any political influence. This we say because in one of the petitions we find that the Sub-Divisional Officer suspended a retailer and granted the shop to another person simply because the M. L. A. asked him to do so. The Sub-Divisional Officers will disregard the alleged statement of the Minister that the existing retailers of fair price shops are in general R. S. S. men and the petitioners and other existing retailers will be free to apply for being appointed as agents under the new Scheme and if they apply, their applications will be considered on merits. We will also like to observe that to avoid any break in the distribution system, the authorities may consider the advisability to continue the existing retailers till agents are appointed under the new scheme.

21. The petitions fail and are dismissed without any order as to costs. The security amount be refunded to the petitioners.


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