S.S. Chadha, J.
(1) This petition under Article 227 of the Constitution of India raises an interesting question as to the scope, effect and purpose of the Essential Commodities Act, 1955 and the Delhi Agricultural Produce Marketing (Regulation) Act, 1976.
(2) M/S. Munshi Ram Ram Niwas through its sole proprietor Shri Ram Niwas, respondent No. 1 was carrying on his business in the market area known as Narela Mandi in the Union Territory of Delhi. He had obtained licenses under 'categories 'A' and 'E' issued under Rule 12 of the Delhi Agricultural Produce Marketing (Regulation General) Rules, 1978 (hereinafter referred to as 'the Rules') framed under the Delhi Agricultural Produce Marketing (Regulation) Act, 1976 (hereinafter referred to as 'the Act'). Those licenses were issued by the Market Committee, Narela Mandi who is the competent authority for the purpose. Previously the grant of licenses was governed by the Bombay Agricultural Produce Marketing Act, 1939 as extended to the Union Territory of Delhi. On the commencement of the Act, the said Bombay Act was repealed. Section 2(b) of the Act defines 'agricultural produce' means such produce (whether processed or not) of agricultural, horticulture, forest, animal husbandry, apiculture or pisciculture as are specified in the Schedule. Item Ix of the Schedule reads. 'Gur sugar, sugatcane, Khandsari, shakar and rashkat'. Section 34 of the Act lays down the grant of licenses subject to the Rules. A Market Committee may after making such inquiries as it deems fit. grant or renew a license for the use of any place in the market area for the marketing of agricultural produce or for operating therein as a trader etc. in relation to the marketing of agricultural produce. Respondent No. 1 obtained the license in form 'A' from the Market Committee. Narela Mandi for carrying on his business or marketing of agricultural produce (which includes khandsari).
(3) In compliance with the order of A.C.P. (Special Cell) Crime Branch, Delhi, certain officers' of the Crime Branch visited on February 28, 1980 the premises of respondent No.1 at 2092, Narela Mandi. Delhi and carried out the physical verification of the stocks of different items held by him. The Crime Branch recovered khandsari 53 bags, khandsari (dust) 18 bags and Khandsari. sulphur 9 bags and two sample each from all the three varieties had been drawn in glass beetles and sealed. 80 bags of khandsari and khandsari sulphur were placed under the safe custody of a 'superdar'. Proceedings were initiated under the Essential Commodities Act, 1955 (hereinafter referred to as 'E.C. Act') read with Delhi Sugar Dealers Licensing Older, 1963 (hereinafter referred to as the Order) issued in exercise of the powers conferred under Section 3 of the E.G. Act. A notice under Section 6-A of the E.C. Act was issued to respondent No. 1 alleging a contravention of the Order and to show cause as. to why the aforesaid seized stocks should not be confiscated to State under the E.C. Act.
Respondent No. 1 filed a reply to the show cause notice. The main contention raised by respondent No. 1 was that he was carrying on business in Narela Mandi under the authority of the license granted under the Act and for that reason he was neither ever required to obtain license? under the Order issued under the E.C. Act nor was a license policy on khandsari ever introduced, pursued, applied or followed by the Delhi Administration. It was pleaded that respondent No. 1 never dreamt nor even ever had in his imagination that he was violating any of the provisions of the Order and honestly and bonafidely believed that after obtaining the licenses under Act, he was carrying on the business truthfully and honestly inasmuch as it is an admitted case that no unaccounted khandsari was found / recovered from the business premises of the petitioner on the date of the raid and that all purchase and sale entries were duly vouched and were accounted for i.e. entered into the account books and purchases made against vouchers.
(4) By order dated 9/ 11. December, 1980 the Collector and Deputy Commissioner (N), Food & Supples, Delhi considered the material before it and recorded that it is not disputed that 80 bags of khandsari and khandsari sulphur were recovered from the possession of respondent No. Ion February 28, 1980. It was also established on record that representative samples were taken from the seized stock and 'got tested through public analyst, Food Laboratory, Delhi Administration vide his report dated July 26, 1980 wherein it had been reported that the samples were confirming to the standard of sugar (khandsari) containing sucrose from 93.5 per cent to 97.16 percent. According to definition given in sub-clause (f) (i) of clause 2 of the Order, 'Sugar' means any form of sugar including khandsari containing more than 90 per cent sucrose. The Collector also found that respondent No. 1 had not applied for or obtained any license in terms of the provisions of the Order. These finding of facts are not disputed before me. The Collector relied upon the definition contained under sub-clause (2) of clause 2 providing that 'dealer' for free sale sugar means a person engaged in the business of purchase, sale or storage for sale of free sale sugar in quantities exceeding ten quintals at time. According to clause 3 of the Order, no person shall carry on a business as a dealer except under and in accordance with the terms and conditions of a license issued in this behalf by the Commissioner. It was also expressed by the Collected that ignorance of law is no excuse. He then held that there had been a prima facie contravention of the provisions of the Order and accordingly in exercise of the powers conferred upon him under section 6-A of the B.C. Act, he thereby confiscated the said stocks of sugar to the State.
(5) Respondent No. I filed an appeal under section 6-C of the E.C. Act against the order dated December 9, 1980 of the Collector by which he directed confiscation of 80 bags of khandsari seized from the premises of respondent No. 1 in Narela Mandi. The appeal was disposed of by Shri P. K. Bahri, Additional Sessions Judge, Delhi in the impugned order dated March 5, 1981. He compared the provisions of the Act and the E.C. Act and come to the conclusion that if a person is covered by the provisions of the Act, then he need not obtain any other license for the same purpose as contemplated in the E.C. Act. A view was expressed that respondent No. 1 was not bound to obtain any license under the B.C. Act and he was authorised to keep 80 bags of khandsari and khandsari sulphur and to deal with them in confirmity with the licenses obtained by him under the Act. He also expressed that there is no mense read which might have impelled respondent No. 1 not to obtain a license under the E. C. Act and/or Order. He accepted the appeal, set aside the order of the Collector and directed that the bags of khandsari be released back to respondent No. 1. This order is impugned in this petition as without jurisdiction and contrary to the provision of law.
(6) The B.C. Act was passed by the Parliament in 1955 and as the Preamble says it is an Act to provide, in the interests of general public, for the control of production, supply and distribution of, and trade and commerce in, certain commodities. The preamble of a statute is a recital of the intent of its framers and can be considered as a Key to the Constitution of the statute. The object and purpose of the E.C. Act is of controlling the production, supply and distribution of, and trade and commerce in certain commodities. Section 3 confer powers on the Central Government who may by order provide for regulating or prohibiting the production, supply and distribution of essential commodities and trade and commerce therein. This power is intended to be exercised for the purpose of maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices or for securing any essential commodity for the defense of India or the efficient conduct of military operations. Sub-section (2) of Section 3 enumerates various matters which can be provided in that Order. Clause (d) says that the order may provide for regulating by licenses, permits or otherwise the storage, transport, distribution, disposal, acquisition, use or consumption or, any essential commodity. These measures are devised for the maintenance of supplies of essential commodities to the community.
(7) The objects and reasons while passing Amendment Act 47 of 1964 highlights the purpose of the E.C. Act. The question of controlling the prices of food stuffs and other essential commodities and ensuring the supply and distribution in adequate quantities of these commodities had been engaging the close and constant attention of the Government. There had been widespread public criticism of the manner in which some sections of the trade and middlemen were able to get round, and render ineffective, legal and administrative measures devised for the maintenance of supplies essential to the community. It was, thereforee, felt that the then existing procedure governing trial of offences relating to the supply and distribution of food stuffs and other essential commodities and enforcement of the prices fixed for these commodities under the law should be amended in order to make the trial of these offences quick and effective. The scheme of the E.C. Act as amended is to have an effective control over prices and distribution of supplies essential to the community.
(8) In exercise of the powers conferred by Section 3 of the E.C. Act reads with the Order of the Government of India in the Ministry of Food and Agriculture dated June 28, 1961 and with the prior concurrence of the Central Government, the Administrator of the Union Territory of Delhi made on February 19, 1963 the Order called the Delhi Sugar Dealers Licensing Order 1963 (for short called the Order). The Order consists of 11 clauses. The scheme of the Order is to require every dealer for controlled sugar or dealer for free sale sugar to take out a license to carry on the business as dealer. The language of clause 3 is that 'no person shall carry on business as a dealer except under and in accordance with the terms and conditions of license issued in this behalf by the Commissioner'. license has been defined in clause (2) (e) meaning a license issued under the Order. A separate license is necessary for each place of business. Any person who stores sugar (except sugar purchased against valid ration document) in any quantity, at any one time, shall unless the contrary is proved, be deemed to store the sugar for the purpose of sale. No person carrying on business in controlled sugar can carry on business in free sale sugar. No whole seller of free sale sugar can at any one time, store more than 250 quintals of sugar and 250 quintals of khandsari. The issue of license is provided in clause 4, on an application in the prescribed form. Every license issued or renewed has also to be in the prescribed form. The conditions of the license provide, inter alia, that the licensee is required to maintain a register of daily accounts for sugar showing correctly (a) the opening stock on each day, (b) the quantities received on each day, showing the place from where and the source from which received, (c) the quantities delivered or otherwise removed on each day showing the place of destination and (d) the closing stock on each day. A licensee is also required to complete his accounts for each day on the day to which it relate, unless prevented by reasonable cause the burden of proving which shall be upon him. He is required to maintain a separate register for khandsari sugar. The particulars of godown where stock is held and quantity in stock in each quality of sugar in stock in bags per quintal is also required to be maintained by the dealer. The licensee is required to issue receipts giving detailed particulars and the receipts and registers are open to inspection. Power is also reserved in the Commissioner for the inspection of the stocks and accounts. There are other provisions which are meant to prevent huge accumulation of stocks of sugar by their dealer with a view to corner the market and push up the prices. The licensees are also required to comply with any directions that may be given to him by the Administrator of the Commissioner in regard to purchase, sale and storage for sale of sugar and in regard to the language in which the register, returns, receipts or invoices have to be written and authenticated and maintenance of register. Stringent provisions have been made in Section 7 for punishing those licensees who contravene or violate an order made under Section 3. Under Section 6-A the Collector is also empowered to confiscate seized essential commodity if the seizure is on account of contravention or violation for order under Section 3 in relation to the commodity. These provisions, in my view clearly show that they are intended to maintain a steady supply of sugar in the open market and to secure its equitable distribution and availability at a fair price.
(9) The object and purpose of the Act as reflected in the preamble is to provide for the better regulation of the purchase, sale, storage and processing of agricultural produce and the establishment of markets for agricultural produces in the Union Territory of Delhi and for matters connected therewith or incidental thereto. The legislation is designed to eliminate middleman in agricultural produce which means by virtue of the definition contained in section 2(b) of the Act, such produce (whether processed or not) of agriculture, horticulture, forest, animal husbandry, apiculture or pisciculture as are specified in the Schedule. The Schedule enumerates various items of the agricultural produce. Power is also vested in the Administrator, under section 66 to amend the Schedule. The purpose of the Act is to protect the producers of the agricultural produce from exploitation. Chapter Ii provides for the constitution of Delhi Agricultural Marketing Board. The establishment of markets and constitution of Market Committees is provided in Chapter III. The powers and duties vested in or to be performed by the Market Committees are given in Chapter IV. Chapter Vi deals with the marketing of agricultural produce. Section 33 provides that subject to the provision of this section and of the Rules providing for regulating the marketing of agricultural produce in any place in the market area, no person shall, on or after the date on which an area is declared under Sub-section (1) of Section 4 to be the market area, without, or otherwise than in confirmity with the terms and conditions of a license granted by (a) the Director, when a Market Committee has not been constituted or has not started functioning, or (b) in any other case by the Market Committee (i) use any place in the market area for the marketing of the agricultural produce specified in the said declaration; or (ii) operate in the market area or in any market therein as a trader, commission agent, broker, processor, weighman, measurer, surveyor, warehouseman or in any other capacity in relation to the marketing of such agricultural produce. The grant of licenses is provided in Section 34 subject to the Rules made in this behalf. A Market Committee may after making such inquiries as it deems fit, grant or renew a license for the use of any place in the market area for the marketing of agricultural produce or for operating therein as a trader, commission agent, broker, processor weighman measurer, surveyor, warehouseman or in any other capacity in relation to the marketing of agricultural produce. Rule 12 deals with the grant of licenses on an application of a person desirous of obtaining a license for carrying on his business or marketing of agricultural produce. The Marketing Legislation is thus intended to enable the producers of agricultural produce to get a fair price for the commodities by eliminating middlemen and providing regulated market for them.
(10) The historical background for the Marketing Legislation was noticed by the Supreme Court in 'M.C. V.S. Arunachala Nadar Ect. vs. The State of Madras & Others' 1959 (1) S.C.R. 92 (1) when it was expressed that Marketing Legislation is now a well settled feature of all commercial countries. The object of such legislation is to protect the producers of commercial crops from being exploited by the middlemen and profiteers and to enable them to secure a fair return for their produce. It was noticed that in this country various Commissions and Committee had been appointed to investigate the problem, to suggest ways and means of providing a fair deal to the grower of the crops, particularly agricultural produce, and find a market for selling their produce at proper rates. Reference was made to the Royal Commission on Agriculture in India and its report. The necessity for Marketing Legislation was stressed by other bodies like the Indian Central Banking Enquiry Committee, the All India Rural Credit and Survey Committee and to the report of Expert Committee set up by the Government of Madras to review the legislation which was under consideration before the Supreme Court. On a consideration of both reports it was observed :
'THE aforesaid observations describe the pitiable dependence of the middle-class and poor ryots on the middlemen and petty traders, with the result that the cultivators are not able to find markets for their produce wherein they can expect reasonable price for them.
With a view to provide satisfactory conditions for growers of commercial crops to sell their produce on equal terms and at reasonable prices, the Act was passed on July 25, 1933. The preamble introduces to provide for the better regulation of the buying and selling of commercial crops in the Presidency of Madras and for that purpose to establish markets and make rules for their proper administration. The Act, thereforee, was the result of a long exploratory investigation by experts in the field, conceived and enacted to regulate the buying and selling of commercial crops by providing suitable and regulated markets by eliminating middle-men and bringing face to face the producer and the buyer so that they may meet on equal terms, thereby eradicating or at any rate reducing the scope for exploitation in dealings.'
(11) A.P. (Agricultural Produce and Livestock) Markets Act, 1966 and the Rules framed therein again came for consideration before the Supreme Court in the recent case reported as 'Sreenivasa. General Traders and others vs . State of Andhra Pradesh and Others' : 3SCR843 . It was again reiterated that marketing legislation which seeks to enable producers to get a fair price for the commodities by eliminating middlemen and providing a regulated market, cannot be said to impose 'unreasonable restriction' on the citizens' right to do business. The marketing legislation provides a scheme for the establishment and regulation of markets for the purchase and sale of notified agricultural produce. The object and purpose of the Act is entirely different than the E.C. Act. The language of each statute is restricted to its own objects and subject. They operate in their own field in the matter of licensing.
(12) There is no force in the argument that the Act being a special and subsequent code has an over riding effect ill so far as the regulation of the notified agricultural produce by way of license is concerned. It may be applicable if two or more laws operate in the same field and each contains a non obstinate clause stating that its provisions will over ride those of any other law. In view of the language of the two laws and their object and purpose, the Act cannot over ride the E.C. Act. The special and specific purpose of the E.C. Act for the maintenance of the supplies of essential commodities to the community would be wholly frustrated if the licenses under the Marketing Legislation were to prevail over them. Section 6 of the E.C. Act, however, provides that any order made under Section 3 shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than the E.C. Act or any instrument having effect by virtue of any enactment other than the E.C. Act. The over riding effect of the Order has the legislative sanction. By enacting Section 6 the Parliament has declared that an Order made under Section 3 shall have effect notwithstanding any inconsistency in the Order with any enactment other than the E.C. Act. The object is to bypass them where they are inconsistent with the provisions of the Order and enforce the provisions of the Order. Apart from it the legislature has not incorporated the non obstinate clause in the Act. However. I feel that the two statutory provisions can harmoneously operate in their own arena without causing any confusion or repugnency. Respondent No. 1 has not obtained any license under the Order. There is power to confiscate the essential commodity seized in pursuance of the Order which is made under Section 3 of the E.C. Act in relation thereto.
(13) The next question to be considered is whether means read is a necessary element for proceedings under section 6-A of the E.C. Act. In order to make the administration of the E.C. Act more strict, it was proposed to insert new provision in the E.C. Act for the confiscation, by Collectors of Districts of the foodgrains, edible oil-seeds and edible oils which have been seized on contravention of any Order issued under the E.C. Act and for appeals from the Orders of the Collectors. Section 6-A to 6-C were added by the E.C. (Amendment) Act 25 of 1966. It was again suggested in 1967 that the panel provisions under E.C. Act should be made more stringent and their implementation made more effective. It was also considered to enlarge the provisions to cover all essential commodities. In Section 6-A for the words 'foodgrains, edible oil-seeds and edible oils', in both places where they occurred, the words 'essential commodities seized' and certain other consequential amendments that the Collector may order confiscation of the essential commodities so seized were substituted by E.C. (Second Amendment) Act 26 of 1967. Some amendments were made in the year 1974 and 1976. Section 6-A(1) at the relevant time reads as under:
(1) Where essential commodity is seized in pursuance of an order made under Section 3 in relation thereto a report of such seizure shall, without unreasonable delay, be made to the Collector of the district or the Presidency-town in which such essential commodity is seized and whether or not a prosecution is instituted for the contravention of such order, the Collector may, if thinks it expedient so to do, direct the essential commodity so seized to be produced for inspection before him, and if he is satisfied that there has been a contravention of the order, may order confiscation :
(A) the essential commodity so seized;
(B) any package, covering or receptacle in which such essential commodity is found; and
(C) any animal, vehicle, vessel or other conveyance used in carrying such essential commodity : Provided that without prejudice to any action which may be taken under any other provision of this Act, no foodgrains or edible oilseeds seized in pursuance of an order, made under section 3 in relation thereto from a producer shall, if the seized foodgrains or edible oilseeds have been produced by him, be confiscated under this section. Provided further that in the case of any animal, vehicle, vessel or other conveyance used for the carriage of goods or passengers for hire, the owner of such animal, vehicle, vessel or other conveyance shall be given an option to pay, in lieu of its confiscation, a fine not exceeding the market price at the date of seizure of the essential commodity sought to be carried by such animal, vehicle, vessel or other conveyance.
It would thus be seen that section 6-A makes necessary provisions for the confiscation of the essential commodity seized and speaks of satisfaction of the Collector that there has been a contravention of the Order made under Section 3 in relation thereto and only then the power of confiscation can be executed.
(14) Section 7 of the E.C. Act provides for penalty, if any person contravenes any Order made under section 3, he shall be punishable in the case of Order made with reference to clause (h) or (i) of sub-section (2) of that section, with imprisonment for a term which may extend to one year and shall also be liable to fine and in the case of any other order, within punishment for a term which shall not be less than three months but which may extend to seven years and shall also be liable to pay fine. Any property in respect of which the Order has been contravened shall be forfeited to the Government. It is essential for the applicability of both sections 7 and 6-a of the E.C. Act that any Order made under section 3 has been contravened. The Order has been issued under section 3 of the E.G. Act. According to clause 3 of the Order, no person shall carry on a business as a dealer except under and in accordance with the terms and conditions of a license issued in this behalf by the Commissioner. Respondent No. 1 did not have a license and thus the Order has been contravened. In other words the same set of circumstances have to be established before an Order of conviction is passed under section 7 or confiscation of essential commodity seized is directed by the Collector under section 6-A. means read is an essential ingredient of a criminal offence. Prior to the amendment of E.C. Act by Amendment Act 36 of 1967, when the words 'whether knowingly, intentionally or otherwise', were inserted, it was settled by the Supreme Court in 'Nathu Lal vs. State of Madhya Pradesh' Air 1966 Sc 143(3), that means read constituted an integral part of an offence under E.C. Act and the Orders made there under. Several High Courts have also taken a similar view that the E.C. Act did not exclude the element of means read from offences punishable under the E.C. Act. The Amendment Act 30 of 1974 which substituted sub-sections (1) and (2) has omitted the words 'whether knowingly, intentionally or otherwise', which were introduced by the Amendment Act 36 of 1967. In my opinion, the Court must always bear in mind that unless the statute, either expressly or by necessary implication, rules out means read as constituent part of the crime, an accused should not be found guilty of an offence against the criminal law unless he has a guilty mind. A person may incur criminal liability even though he has acted without intention, recklessness or negligence in relation to one or more of the elements of that crime only when the statute has created a strict or absolute liability but not otherwise, means read was excluded explicitly by Amendment Act 36 of 1967 but those words have now been omitted of Act 30 of 1974. These omissions revives the judicial interpretation that the element of means read is not excluded from the ingredients of an offence under section 7 of the E.C. Act.
(15) The provisions of section 6-A are in pari materia with the provisions of section 7. An intentional contravention of an Order made under Section 3 of E.C. Act has to be established. means read or bonafide of a dealer is a necessary element of the proceedings under section 6-A of E.C. Act. The preponderence of judicial opinion is that means read is a necessary ingredient in the proceedings for enforcing the penal provision incorporated in section 6-A of E.C. Act which empowers the Collector to order confiscation. In 'Kishori Lal Bithani vs . The Addl. Collector and District Magistrate, Kanpur and Others', : AIR1969All159 , and 'Babu Ram Jagan Nath vs . The District Magistrate, Meerut', : AIR1970All396 , it was held that the consideration of means read or bonafides of a dealer is relevant while passing an order of confiscation of foodgrains from him under Section 6-A of E.C. Act. It was expressed that the view that the question of bonafides or means read of a dealer may have bearing in criminal proceedings and may be considered there if any prosecution is launched against the dealer and those considerations are out of place at the stage of the confiscation, is not correct. The Bombay High Court in 'Madhev Keshav Mirashi vs . The State of Maharashtra', (6), held that act which constitutes the basis of prosecution under section 7 as well as the basis of an order of confiscation under section 6-A of the E.C. Act being the same, it cannot have a different content under section 6-A and section 7 of the same Act. The Madhya Pradesh High Court has also taken the same view in the case of 'Khem Raj Jug Raj vs . The State of Madhya Pradesh' (7) and other cases.
(16) A contrary view has been taken by a learned Single Judge of Gujrat High Court in 'Swastik Oil Industries vs. The State of Gujarat'. 1978 Guj. L.R. 1117(8). With great respect to the learned Judge. I am unable to subscribe to the view that means read is not an essential element in the proceeding under section 6-A of E.C. Act. It is another thing to say that as the law now stands by introduction of section. 10-C(1) by Amendment Act 30 of 1974 that in any prosecution under the E.C. Act which requires a culpable means read on the part of the accused, the same must be presumed unless the accused proves that he had no such mental state with respect to the offence for which he is tried; than to say that means read is not an essential element of the offence under Section 6-A of the E.C. Act which is only quasi criminal offence. If it is proved that the breach of the Order under section 3 was under a. bonafide belief that the dealer could legally store/deal with the sugar seized without infringing the Order, there would be no contravention of section 6-A. The power of confiscation of an essential commodity seized in contravention of an order issued under section 3 is a discretionary power as the word 'may' in section 6-A suggests. (See: State of Karnataka vs . K. B. Walvaker', : 1981CriLJ867 ).
(17) For these reasons the petition is allowed and the impugned orders are quashed. The case is remanded back to the Collector for de novo determination of the proceedings under section 6-A of the E.C. Act in accordance with law.