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Sri Vijayalakshmi Rice Mills, New Contractors Co. and ors. Vs. State of Andhra Pradesh - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtSupreme Court of India
Decided On
Case NumberCivil Appeal Nos. 805-806 and 972 to 977 of 1973
Judge
Reported inAIR1976SC1471; (1976)3SCC37; [1976]3SCR775; 1976(8)LC367(SC)
ActsEssential Commodities Act, 1955 - Sections 3, 3(2) and 3(3); Customs Act of 1873; Constitution of India - Article 133(1)
AppellantSri Vijayalakshmi Rice Mills, New Contractors Co. and ors.;sri Jayalakshmi Rice and Oil Mills Contra
RespondentState of Andhra Pradesh;state of Andhra Pradesh
Appellant Advocate F.S Nariman,; J.V.K. Gurunathan,; T.V. Narasimhan Murty,;
Respondent Advocate P. Ram Reddy, ; P.P. Rao, Advs.
Cases ReferredGen. v. Puget
Prior historyFrom the judgment and decree dated the 8th June 1971 and 23rd November 1971 respectively of the High Court of Andhra Pradesh at Hyderabad in Appeal Suit Nos. 766 of 1968, 18 of 1969, 779, 780, 782 to 785 of 1968 respectively
Excerpt:
.....- retrospective effect - section 3 of essential commodities act, 1955, rice (andhra pradesh) price control order, 1963 and rice (andhra pradesh) price control (third amendment) order, 1964 and andhra pradesh rice procurement (levy) order, 1959 - appeal from judgment and decree of high court - whether appellants to be paid price for supply of rice at rate specified in order of 1963 or at enhanced rate as fixed by order of 1964 - provisions of section 3 of act and order of 1959 clearly indicate that price payable to dealers and millers for supplies of rice was control price obtaining on date when sale made - sales made before coming into force of order of 1964 - appellants cannot justifiably claim benefit of increased price specified in order of 1964 - appeal dismissed. - indian..........for the supplies of rice made by the appellants in january and february, 1964, they are to be paid price according to the rate specified in the rice (andhra pradesh) price control (third amendment) order, 1964 dated march 23, 1964 or according to the rate specified in the rice (andhra pradesh) price control order as it stood in 1963. the question arises in the following circumstances:2. the appellants are millers and carry on the business of paddy and rice in the state of andhra pradesh. on july 31, 1959, the governor of andhra pradesh in exercise of the powers conferred on him by section 3 of the essential commodities act, 1955 (central act x of 1955) hereinafter referred to as 'the act' made an older called the andhra pradesh rice procurement (levy) order 1959. clause 3 of the order.....
Judgment:

Jaswant Singh, J.

1. The batch of Appeals Nos. 805, 806 and 972 to 977 of 1973 by certificate from the judgments and decrees of the High Court of Andhra Pradesh in Appeals Nos. 766 of 1968, 18 of 1969, 779 of 1968, 780 of 1968, 782 of 1968, 783 of 1971, 784 of 1958 and 785 of 1968 raise a simple but an interesting question namely, whether for the supplies of rice made by the appellants in January and February, 1964, they are to be paid price according to the rate specified in the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964 dated March 23, 1964 or according to the rate specified in the Rice (Andhra Pradesh) Price Control Order as it stood in 1963. The question arises in the following circumstances:

2. The appellants are millers and carry on the business of paddy and rice in the State of Andhra Pradesh. On July 31, 1959, the Governor of Andhra Pradesh in exercise of the powers conferred on him by Section 3 of the Essential Commodities Act, 1955 (Central Act X of 1955) hereinafter referred to as 'the Act' made an older called the Andhra Pradesh Rice Procurement (Levy) Order 1959. Clause 3 of the order required every dealer and every miller to sell to the State Government on requisition served on him by the requisitioning authority at the controlled price (a) 40 per cent of the quantity of rice held in sock by him at the commencement of the order and (b) 40 per cent of the total quantity of rice purchased by him every day beginning with the commencement of the order. Clause 2(a) of the order defined 'controlled price' as meaning the maximum price fixed under Section 3 of the Act for the sale of rice by the Central Government from time to time (emphasis supplied). On December 19, 1963, the Central Government in exercise of the power conferred on it by Section 3 of the Act made an order called the Rice (Andhra Pradesh) Price Control Order, 1963 which extended to the districts of Krishna, West Godavari, East Godavari, Guntur, Nizamabad, Warangal and Nellore in the State of Andhra Pradesh. Clause (2) of the order provided that the maximum prices at which the varieties of rice specified in column (1) of the Schedule to that Order was to be sold in wholesale quantities would be as specified in the corresponding entries in column (2) of the said Schedule. The said Schedule inter alia provided that Akkulu rice would be sold at Rs. 46.89 per quintal. In compliance with the requisitions served on them by the requisitioning authority of the State of Andhra Pradesh, the appellants sold various quantities of that variety of rice to the Government of that State from January 26, 1964, to February 21, 1964, and were paid at the aforesaid rate of Rs. 46.89 per quintal. By means of the Rice (Andhra Pradesh) Price Control (Second Amendment) Order, 1964, dated March 20, 1964, the Central Government amended Sub-clause (1) of Clause 2 of the Rice (Andhra Pradesh) Price Control Order, 1963 and ordained that in the said sub-clause for the words 'the Schedule', the words and figures Schedule I shall be substituted. On March 23, 1964 the Central Government issued the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964, Clause 2 of the Order ran thus:

2. In the Rice (Andhra Pradesh) Price Control Order, 1963, in Schedule I for the varieties of rice and the maximum prices therefore, the following shall substituted namely:-------------------------------------------------------------------- Varieties of the rice Maximum price per quintal --------------------------------------------------------------------- I. Districts other than Melore ... ... ... ... AKKulu 52.25 ... ... ... ...

3. On the issue of this order, the appellants made representation to the Government of Andhra Pradesh requesting that for the aforesaid supplies of Akkulu rice made by them from January 26, to February 21, 1964, they should also be paid at the enhanced price of Rs. 52.25 per quintal. As the representations made by them did not evoke a favourable response, they filed suits in the Court of the Subordinate Judge, Machilipatnam for recovery of the difference between the controlled prices specified in the Rice (Andhra Pradesh, Price Control Third Order 1963, dated December 19, 1963 and Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964. The suits filed by them were decreed by that Court. Aggrieved by these judgments and decrees, the State of Andhra Pradesh preferred appeals to the High Court at Hyderabad which were allowed on the ground that as the supplies of rice were made by the appellants before the Rice (Andhra Pradesh) Price Control (Third Amendment] Order, 1964, they were entitled only to the price specified in the Schedule to the Rice (Andhra Pradesh) Price Control Order, 1963. Dissatisfied with these judgments and decrees, the appellants applied for certificate under Article 133(1)(a) of the Constitute n which was granted to them.

4. The sole question for determination in these appeals, as already indicated, is whether the appellants were to be paid price for the supplies of rice made by them January 26, 1964, to February 21, 1964, at the rate of Rs 46.89 per quintal-the rate specified in the Rice (Andhra Pradesh) Price Control Order, 1963, dated December 19, 1963 or at the enhanced rate of Rs. 52.25 per quintal as filed by the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964 dated March 23, 1964.

5. Mr. Nariman appearing on behalf of the appellants had Laid great emphasis on the word 'substituted' occurring in Clause 2 of the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964 and has urged that the claim of the appellants cannot be validly ignored. Elaborating his submission, Counsel has contended that as the prices fixed by the Government are meant for the entire season, the appellants have to be paid at the controlled price as fixed vide the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964, regardless of the dates on which the supplies were made. We cannot accede to this contention. It is no doubt true that the literal meaning of the word 'substitute' is 'to replace' but the question before us is from which date the substitution or replacement of the new Schedule took effect. There is no deeming clause or some such provision in the Rice 'Andhra Pradesh) Price Control (Third Amendment) Order, 1964 to indicate that it was intended to have retrospective effect. It is a well recognized rule of interpretation that int he absence of express words or appropriate language from which retrospectivity may be inferred, a notification takes effect from the date it is issued and not from any prior date. The principle is also well settled that statutes should not be construed so as to create new disabilities or obligations or impose new duties in respect of transaction which were complete at the time the Amending Act came into force. See Nani Gopal Mitra v. The State of Bihar : 1970CriLJ1396

6. The aforesaid sales in the instant cases having been made by the appellants before the coming into force of the Rice (Andhra Pradesh) Price control (Third Amendment) Order, 1964, and the property in the goods having passed to the Government of Andhra Pradesh on the dates the supplies were made, the appellants had to be paid only at the controlled price obtaining on the dates the sales were effected and not at the increased price which came into operation subsequently. This view is in consonance with the provisions of Section 3 of the Act and the Andhra Pradesh Rice Procurement (Levy) Order, 1959 which clearly indicate that the price payable to the dealers and Millers for the supplies of rice made by them is the control price obtaining on the date when the sale is made. Similar view is taken in the unreported decision dated April 20, 1962 of this Court in K. Appayyu Shanbhague and Co. v. The State of Mysore and Anr. (2) where it was Laid down that the order made under Section 3(2)(f) of the Act are offers of sole which the person on whom a requisition is served has no option but to accept and that the price that has to be paid is the controlled price fixed by the Government under section 3(2)(c) of the Action the date when the goods are ascertained or when the property in the goods passes to the buyer. This decision was followed by the High Court of Andhra Pradesh in The Union of India, represented by the Secretary, Ministry of Food Agriculture, Government of India, New Delhi v. Kanuri Damodaraiah and Co. Alluri Venkatanarasiah (3)(1964) 1 An. W.R 81 where it was held that an order under Section 3(2)(f) amounts to an agreement for sale and the price payable for the quantities of rice supplied is a price payable in accordance with the price notified under the provisions of Section 3(3) of the Act.

7. In the instant cases, the sale having been made before the coming into force of the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964, the appellants cannot justifiably claim the benefit of the increased pi ice specified in the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964. The acceptance of the contention raised on behalf of the appellants will lead to grave consequence. It will have the effect of reopening the transactions past and closed and would thus give rise to lots of difficulties.

8. Mr. Nariman has, in support of his contention, relied on the folio wing passage occurring at p. 394 in Grates on Statute Law (Sixth Edition):

Explanatory and declaratory Acts retrospective

Where a statute is pass-d for the purpose of supplying an obvious o mist ion in a former statute, or, as Parke J (afterwards Baron Parke) said in R.V. Dursley (1832) 3 B. and Ad. 465, 459 'to 'explain' a former statute,' the subsequent statute has relation back to the time when the prior Act was passed, Thus in AT t. Gen. v. Puget (1816) 2 Price 381, it appeared that by a Customs Act of 1873 (53 Geo. 3, c. 33) a duty was imposed upon hides of 9s. 4d. but the Act omitted to state that it was to be 9s. 4d. per cwt., and to remedy the omission another Customs Act (53 Geo, 3, c. 105) was passed later in the same year, Between the passing of these two Acts some hides were exported, and it was contended that they were not liable to pay the duty of 9s. 4d per cwt., but Thomson C.B. in giving judgment for the Attorney-General said : 'The duty in this instance was in fact imposed by the first Act, but the grots mistake of the omission of the weight for which the sum expressed was to have been payable occasioned the amendment made by the subsequent Act, but that had reference to the former statute as soon as it passed, and they must be taken together as if they were one and the same Act.

Where an Act is in its nature declaratory, the presumption against construing it retrospectively is inapplicable.

9. This passage has, in our opinion, no bearing on the question before us in view of the fact that the Rice (Andhra Pradesh) Price Control (Third Amendment Order, 1954 is neither explanatory nor declaratory, as sought to be interpreted by the Counsel.

10. The contention of Mr. Nariman that the controlled prices fixed by the Central Government for sale of rice are seasonal pries not being based upon any cogent material cannot also be accepted.

11. The High Court was, therefore, right in allowing the aforesaid appeals preferred by the respondent and reversing the judgments and decrees passed by the Subordinate Judge, Machilipatnam.

12. In the result, the appeals fail and are dismissed with costs.


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