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S.R. Balasubramanian Vs. District Collector, Palghat and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKerala High Court
Decided On
Case NumberO.P. No. 7940 of 1983-J
Judge
Reported inAIR1984Ker87
ActsEssential Commodities Act, 1955 - Sections 6A(2)
AppellantS.R. Balasubramanian
RespondentDistrict Collector, Palghat and anr.
Appellant Advocate K. Ramakumar,; C.P. Ravindranath and; E.M. Joseph, A
Respondent AdvocateGovt. Pleader
DispositionAppeal allowed
Cases ReferredMohinder Singh v. Chief Election Commissioner.
Excerpt:
.....mill premises in contravention of food grains order - petitioner challenged order of disposal of seized essential commodity - respondent ordered for distribution of seize commodity without notice or opportunity given to person affected - impugned order not sustainable - respondent directed to issue notice to petitioner and give him opportunity of being heard as to whether rice seized has to be disposed of urgently pending confiscation proceedings. - - and if that is insisted upon, the very purpose of the action might be defeated. sometimes urgent action may have to be taken on grounds of public health or safety, for example to seize and destroy bad meat exposed for sale or to order the removal tohospital of a person with an infectious disease. it may injure the company's..........petition is directed against that part of ext. p2 proceedings which ordered the disposal of the seized essential commodity (rice) through the a. r. ds, as ration article to the card holders. the counsel for the petitioner, sri k. ramakumar, submitted that pending the confiscation proceedings, with respect to which final orders were yet to be passed in accordance with the provisions contained in section 6b of the act, the essential commodity seized from the petitioner could not be ordered to be disposed of by the 1st respondent, the district collector, without giving notice and an opportunity of being heard to the petitioner. the-advocate-general who appeared on behalf of the respondents submitted that the section in terms did not contemplate the issue of notice or an opportunity of.....
Judgment:

Bhaskaran, Ag. C.J.

1. The question of law that falls for decision in this writ petition, referred to the Division Bench by our learned brother Justice Paripoornan, relates to the true construction to be given to Section 6-A(2) of the Essential Commodities Act, 1955, (Central Act 10/55), for short the Act.

2. The facts material for our present purpose are not much in dispute. On 7-9-1983 the 2nd respondent, the Taluk Supply Officer (Special Squad), Ottapalam, having seized from the petitioner 50.75.000 quintals of raw rice and 30 quintals of boiled rice under a mahazar, the said rice having been found stocked in a mill premises in contravention of the Kerala Food Grains Dealers Licensing Order (the Food Grains Order), a notice dated 9-9-1983, a true copy of which is Ext. P2, was issued to the petitioner by the 1st respondent, the District Collector, Palghat, stating inter alia -

'Since the seized articles are of a perishable nature/long storage will damage them/ orders have been issued to dispose of them through the ARDs as ration article to the card holders and remit the sale proceeds, under R. D. pending finalisation of the case under Essential Commodities Act.'

3. Section 6A of the Act deals with confiscation of foodgrains, edible oilseeds and edible oils; and Sub-section (2) thereof reads:--

'(2). Where the Collector, on receiving a report of seizure or an inspection of any essential commodity under Sub-section (1), is of the opinion that the essential commodity is subject to speedy and natural decay or it is otherwise expedient in the public interest so to do, he may;--

(i) order the same to be sold at the controlled price, if any, fixed for such essential commodity under this Act or under any other law for the time being in force; or

(ii) where no such price is fixed, the same to be sold by public auction :

Provided that in case of foodgrains, the Collector may, for its equitable distribution and availability at fair prices, order the same to be sold through fair price shops at the price fixed by the Central. Government or by the State Government, as the case may be, for the retail sale of such food-grains to the public.'

Sub-section (3) of the section provides :

'(3). Where any essential commodity is sold, as aforesaid, the sale proceeds thereof, after deduction of the expenses of any such sale or auction or other, incidental expenses relating thereto, shall -

(a) where no order of confiscation is ultimately passed by the Collector,

(b) where an order passed on appeal Under Sub-section (1) of Section 6-C so requires, or

(c) where in a prosecution instituted for the contravention of the order in respect of which an order of confiscation has been made under this section, the person concerned is acquitted, be paid to the owner thereof or the person from whom it is seized.'

4. The challenge in this writ petition is directed against that part of Ext. P2 proceedings which ordered the disposal of the seized essential commodity (rice) through the A. R. Ds, as ration article to the card holders. The counsel for the petitioner, Sri K. Ramakumar, submitted that pending the confiscation proceedings, with respect to which final orders were yet to be passed in accordance with the provisions contained in Section 6B of the Act, the essential commodity seized from the petitioner could not be ordered to be disposed of by the 1st respondent, the District Collector, without giving notice and an opportunity of being heard to the petitioner. The-Advocate-General who appeared on behalf of the respondents submitted that the section in terms did not contemplate the issue of notice or an opportunity of being heard, presumably for the reason that the action under the section was intended only for the purpose of preserving the essential commodity that might, in the absence of such speedy action, perish, and would be lost to all concerned. He also submitted that such disposal of property did not affect the rights of the person from whom it 'had been seized, as he would be entitled to receive the sale proceeds in the event of his succeeding in the confiscation proceedings or in the criminal proceedings, as the case may be. He further submitted that the provision is akin to that of Section 451 of the Criminal P. C, which provides:--

'451. Order for custody and disposal of property pending trial in certain cases.--When any property is produced before any Criminal Court during any inquiry or trial, the Court may make such order as it thinks fit for the proper custody of such property pending the conclusion of the inquiry or trial, and, if the property is subject to speedy and natural decay, or if it is otherwise expedient so to do, the Court may, after recording such evidence as it thinks necessary, order it to be sold or otherwise disposed of.'

In support of his argument that no notice or opportunity of being heard need be given to the person from whom the essential commodity was seized before ordering disposal of the commodity if the Collector was of the opinion that it was subject to speedy and natural decay or it was otherwise expedient so to do, the Advocate-General relied on the Division Bench ruling of the Andhra Pradesh High Court in K. Venkataratnam v. Dist. Revenue Officer (AIR 1975 Andh Pra 359). That too was a case in which the order directing the sale of foodgrains seized under the provisions of the order, similar to the Foodgrains Order, was ordered pending confiscation proceedings; and that order to sell the seized commodity was under challenge in that writ petition. On the question as to whether the sale could be ordered only after notice to the person from whom the essential commodity was seized, the views expressed by the High Court could, be gathered from the following passage in para 20 of the judgment, at page 365 of the report, which reads as follows:--

'When there is scarcity of rice, sugar, and wheat and if these scheduled commoditiesare to be kept in storage till such time as the proceedings under Section 6A culminate, there is the danger of these commodities deteriorating in quality, apart from there being short supply of these commodities in a given area or locality. All that has to be seen is whether a dealer, whose commodities have been seized invoking the provisions of the Act and the Orders made thereunder has been given a reasonable opportunity before his goods are confiscated. It is not necessary that at every stage he should be given an opportunity, i. e., before his goods are seized and later when the goods are sought to be sold. Section 6B does not contemplate giving notice at every stage. It is for the Licensing Authority or the Collector or the Government, as the case may be, to consider, in a given case, whether the essential commodities seized should be sold or kept in storage until the completion of the proceeding under Section 6A. It depends upon the supply or distribution position of essential commodities to the consumer public in a particular area, locality, village or town. So, this is a matter entirely within the discretion of the competent authority to determine, in a given case, whether the essential commodities seized should be sold so as to make them available to the needy consumer public or whether they should be kept in storage till such time as the proceedings under Section 6A conclude. It is not for this Court, while exercising its jurisdiction under Article 226 of the Constitution, to interfere with the discretionary power exercised by the competent authority. It may be pointed out that when the Legislature clothes a particular authority, with power to make an enquiry it impliedly grants that authority the power to do all such acts or employ all such means as may be essentially necessary in exercise of this power.'

5. It is true that there is no express provision in the section which enjoins the issue of notice or the giving of opportunity of being heard to the person from whom the essential commodity was seized. All the same, in our opinion, it could not invariably be the rule that no notice or opportunity of being heard need be given to the person affected. On a proper construction of the provisions of the section, it could be found that while there is no express provision requiring the issue of notice or the giving of an opportunity of being heard to the person concerned, in the absence of any prohibition with respect to the issue of notice or giving of an opportunity of being heard, there is a discretion in the matter, vested in the Collector, and that has to be exercised after due satisfaction on an objective consideration of all aspects touching the matter. There may be cases where the issue of notice or the giving of an opportunity of being heard might not be practicable; and if that is insisted upon, the very purpose of the action might be defeated. There might be, on the other hand, cases where it would not only be desirable, but also necessary in keeping with the true spirit of the principles of natural justice that the proposed action is given effect to only after the issue of notice or an opportunity of being heard is given to the party likely to be materially affected. This position has been lucidly expressed by H.W.R. Wade in his Administrative Law, 5th Edition, at pp. 472 and 473, as follows:--

'For example, the Courts have repudiated earlier suggestions that the principles of natural justice do not apply to disciplinary bodies: they must act fairly just the same as anyone else; and are just as subject to control by the Courts'. Prisoners charged with disciplinary offences before boards of prison visitors are entitled to a fair hearing, which may include the right to call witnesses. Whether the same principles apply to the disciplinary decisions of a Prison Governor in the day-to-day administration of the prison is the subject of conflicting dicta in the Court of Appeal. The opinion of Shaw L. J. was that it was scarcely possible to distinguish the two cases, and he rejected the argument that to allow a prisoner to state his case to the Governor would undermine the whole system of prison discipline.

On the other hand, it must be emphasised that it is not possible to lay down rigid rules as to when the principles of natural justice are to apply; nor as to their scope and extent Everything depends on the subject-matter. The application of natural justice, resting as it does upon statutory implication, must always be in conformity with the scheme of the Act and with the subject-matter of the case. In the application of the concept of fair play there must be real flexibility. There must also have been some real prejudice to the complainant; there is no such thing as a merely technical infringement of natural justice.

Sometimes urgent action may have to be taken on grounds of public health or safety, for example to seize and destroy bad meat exposed for sale or to order the removal tohospital of a person with an infectious disease. In such cases the normal presumption that a hearing must be given is rebutted by the circumstances of the case. So it is also, for obvious reasons, where the police have to act with urgency, e.g. in making arrests.

Even in cases not involving urgency it may be equally clear that no hearing is required. A decision to prosecute or bring legal proceedings, damaging though it may be to the accused, does not entitle him to be consulted or shown the evidence in advance. The same applies to a decision by the Department of Trade to appoint Inspectors to investigate suspicious circumstances in the affairs of a company; it may injure the company's reputation, but that risk has to be accepted as the price of the legal privileges enjoyed by companies; and in many cases prior warning would frustrate the objects of the legislation. Another obvious case is where a Minister grants to a local authority an extension of time for submitting a compulsory purchase order in connection with a slum clearance scheme. In resolving to adopt a slum clearance scheme, likewise, a local authority need not first give a hearing to an objecting landowner, since under the statutory procedure this resolution is the initial steps and tie Act provides amply for the hearing of objections at a statutory enquiry, lake-wise a right of appeal may imply that no earlier hearing is necessary. And there are other situations in which an opportunity for later challenge is sufficient, as in the case of a subpoena to a witness. But where the grant of a fair hearing is consistent with the exercise of the legal power, the law leans strongly in its favour. Judges of the highest authority have approved the epigram of Byles J., that the justice of the common law will supply the omission of the legislature. Nor is this presumption to be excluded merely for the sake of administrative convenience; convenience and justice are often not on speaking terms.'

6. This question has been dealt with rather elaborately by the Supreme Court in Swadeshi Cotton Mills v. Union of India, (1981) 1 SCC 664 : (AIR 1981 SC 818). In para 37 Sarkaria, J. observed as follows:--

'In Maneka Gandhi, it was laid down that where in an emergent situation, requiring immediate action, it is not practicable to give prior notice or opportunity to be heard, the preliminary action should be soon followed by a full remedial hearing.'

emphasizing the need for giving an opportunity for giving remedial hearing even in cases where a prior notice or an opportunity of being beard was not considered practicable, in para 42 of the said judgment the position is even more lucidly stated:

'In short, the general principle -- as distinguished from an absolute rule of uniform application -- seems to be that where a statute does not, in terms, exclude this rule of prior hearing but contemplates a post-decisional hearing amounting to a full review of the original order; on merits, then such a statute would be construed as excluding the audi alteram partem rule at the pre-decisional stage. Conversely, if the statute conferring the power is silent with regard to the giving of a pre-decisional hearing to the person affected and the administrative decision taken by the authority involves civil consequences of a grave nature, and no full review or appeal on merits against that decision is provided, Courts will be extremely reluctant to construe such a statute as excluding the duty of affording even a minimal hearing shorn of all its formal trappings and dilatory features at the pre-decisional stage, unless, viewed pragmatically, it would paralyse the administrative progress or frustrate the need for utmost promptitude. In short, this rule of fair play 'must not be jettisoned save in very exceptional circumstances where compulsive necessity so demands'. The Court must make every effort to salvage this cardinal rule to the maximum extent possible, with situational modifications. But, to recall the words of Bhagwati, J., the core of it must, however, remain, namely, that the person affected must have reasonable opportunity of being heard and the hearing must be a genuine hearing and not an empty public relations exercise.

7. It is true, in the instant case, the discretion is vested with the Collector as to whether the essential commodity seized is to be sold or not. If it is to be sold, he is to be satisfied that the commodity was subject to speedy and natural decay or it was otherwise expedient in the public interest so to do. The opinion has to be arrived at in the true spirit of the provisions contained in the statute and on an objective assessment of the relevant facts and circumstances, not arbitrarily or capriciously. The commodity seized in this case it raw rice and boiled rice. The question is whether it has to be sold pending final orders in the confiscation proceedings; and it so, whether it has to bedone without notice and without giving an opportunity of being heard to the person affected. With respect to this the opinion formed by the Collector should be available on the concerned file. As has been pointed out by the Supreme Court in Mohinder Singh v. Chief Election Commissioner. (AIR 1978 SC 851) the public authorities making public orders should clearly state the reasons behind the decision arrived at by them. In this case it would have made all the difference had the file disclosed the reasons for the sale pending the passing of the final order in the confiscation proceedings, and also of the urgency in doing so dispensing with notice and an opportunity of being heard given to the person affected. The concerned file, as we understand, disclosed total absence of the application of mind or a fair decision taken on a correct appraisal of the fact and circumstances of the case. We are, therefore, of the opinion that the decision of the 1st respondent to direct distribution of the seized commodity through A. R. Ds. without notice or an opportunity of being heard given to the person affected is not sustainable.

8. There could be no hard and fast rule or straight jacketted formula in regard to the situation in which notice would be required or not. A certain amount of play in the joints has to be allowed.

9. We make it clear that there is no invariable rule that it is only after notice and an opportunity of being heard given to the person affected, the sale or disposal of the seized commodity, pending final orders in the confiscation proceedings, could be ordered. The decision on this aspect f the matter has to be taken on the facts and circumstances of each case. There might be cases where such action has to be taken dispensing with notice and opportunity of being heard given to the person affected; there might be other cases, as in the present case, where substantial justice could be done by taking a decision with respect to the manner in which the seized article should be preserved or disposed of after giving a notice and an opportunity of being heard to the person affected. In the light of the modern trend of thought in the branch of administrative law, as stressed by the judgments of the Supreme Court referred to above, with due respect, we are not inclined to accept the views expressed by the Andhra Pradesh High Court to which reference has already been made.

10. The result, therefore, is that the writ petition is allowed; and the 1st respondent is directed to issue notice to the petitioner and also give him an opportunity of being heard on the question as to whether the rice seized has to be disposed of urgently pending final decision on the confiscation proceedings; and if so, the manner in which it has to be disposed of. Action may, thereafter, be taken in the light of the opinion that might be formed by the 1st respondent. No costs.


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