Skip to content


Surajmal Roopchand and Co. Vs. the State of Rajasthan and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtRajasthan High Court
Decided On
Case NumberCivil Writ No. 1196 of 1964
Judge
Reported inAIR1967Raj104; 1967CriLJ809
ActsDefence of India Rules, 1962 - Rules 125, 125(2), 125(3), 141(1) and 141(2); Constitution of India - Articles 226, 254(1) and 301; ;Essential Commodities Act, 1955
AppellantSurajmal Roopchand and Co.
RespondentThe State of Rajasthan and ors.
Appellant Advocate C.L. Agarwal and; B.S. Sharma, Advs.
Respondent Advocate Kan Singh, Govt. Adv.
DispositionPetition allowed
Cases ReferredHarishaukar Bagla v. State of Madhya Pradesh
Excerpt:
- - ghasilal, mannalal and roopchand arrested for deliberately violating the order of the district magistrate and the other two partners ram gopal and suraj mal, who were not at kota on the day the mass arrests of the grain merchants at kota had taken place, escaped that arrest, but they apprehended that they may also be humiliated like other grain merchants any day by arresting them. 4) as to why its security deposit may not be for foited and its licence for dealing in food-grains be got cancelled for contravening the order of the district magistrate dated 18-6-1964. it is also averred that the said order dated 18-6-1964 was revoked by the district magistrate, kota on 6-7-1964 but in spite of its withdrawal respondents are bent upon arresting the two partners of the firm and.....tyagi, j. 1. this writ application filed by messrs. surajmal roopchand under article 226 of the constitution of india through one of its partners ram gopal arises out of the following circumstances:2. the petitioner is a partnership firm with five persons, namely, ghasilal, mannalal, roopchand, surajmal and ram gopal as its partners, and it carries on its business at kota and deals in the purchase and sale of grain. on 19-6-1964 it despatched 91 bags of jawar and 59 bags of maze from kota junction rail way station for amalsar and dehad stations respectively in the state of gujarat. it is alleged that the said booking of the grain was done in the normal course of business, and it was after receiving proper receipts from the railway officials that the goods were handed over to the western.....
Judgment:

Tyagi, J.

1. This writ application filed by Messrs. Surajmal Roopchand under Article 226 of the Constitution of India through one of its partners Ram Gopal arises out of the following circumstances:

2. The Petitioner is a partnership firm with five persons, namely, Ghasilal, Mannalal, Roopchand, Surajmal and Ram Gopal as its partners, and it carries on its business at Kota and deals in the purchase and sale of grain. On 19-6-1964 it despatched 91 bags of Jawar and 59 bags of maze from Kota Junction rail way station for Amalsar and Dehad stations respectively in the State of Gujarat. It is alleged that the said booking of the grain was done in the normal course of business, and it was after receiving proper receipts from the railway officials that the goods were handed over to the Western Railway authorities at Kota Junction. On 18th June, 1964. the District Magistrate. Kota, purporting to act under the authority conferred on him by Rule 125 of the Defence of India Rules, 1962 (hereinafter to be referred as the Rules), issued an order prohibiting the movement or the transportation of barley, gram, jawar, maze, bajra. rice, paddy or any products of any of these foodgrains by rail, road or water or in any other manner from any place in the district of Kota to any place outside Rajasthan.

This order in the form of a notification was published in the Rajasthan Gazette, Part IV (ga) of 25th June. 1964. It is averred that none of the partners of the petitioner firm received the information about the issue of the said notification (Ex. 2) upto 20-6-1964 and they despatched the goods without knowing that a ban was imposed on the movement of jawar and maze by the said order. On the same day, that is, on 18-6-1964 the District Magistrate issued another order Ex. 2 authorising all the Magistrates posted at Kota, and the District Supply Officer and the Assistant Supply Officer of Kota to exercise all the powers enumerated in para 2 of the notification Ex. 2, and it was in the exercise of the powers under this order (Ex. 2) that the Sub-Divisional Magistrate, Kola went to the railway station and seized the goods of the petitioner. The Superintendent of Police (respondent No. 3) through his subordinate Circle Inspector (respondent No. 6) got three partners of the firm viz. Ghasilal, Mannalal and Roopchand arrested for deliberately violating the order of the District Magistrate and the other two partners Ram Gopal and Suraj Mal, who were not at Kota on the day the mass arrests of the grain merchants at Kota had taken place, escaped that arrest, but they apprehended that they may also be humiliated like other grain merchants any day by arresting them.

It is also alleged that on 23-6-1964, the District Supply Officer served the petitioner firm with a notice to show cause within three days from 24-6-1964 (copy of the notice is Ex. 4) as to why its security deposit may not be for foited and its licence for dealing in food-grains be got cancelled for contravening the order of the District Magistrate dated 18-6-1964. It is also averred that the said order dated 18-6-1964 was revoked by the District Magistrate, Kota on 6-7-1964 but in spite of its withdrawal respondents are bent upon arresting the two partners of the firm and humiliating them like other 85 grain merchants who were denied bails by the City Magistrate even when some of the merchants were released on bail by the Sessions Judge. Kota on 6-7-1964.

3. The petitioner by means of this application has challenged the legality of the order Ex. 2 on the ground that it violates the guarantee of free trade embodied in Articles 301 302 and 303 of the Constitution of India as it purports to restrict the movement of the grain beyond the territories of the State of Rajasthan, that such a restriction is not in public interest, that the restriction is imposed by the District Magistrate without obtaining previous sanction of the President, that the State Government or its delegate has no power to make laws in respect of inter-State trade or commerce as the jurisdiction to pass such an order is exclusively with the centre and that under the provisions of the Essential Commodities Act, 1955 it is only the Central Government which is authorised to make an order for regulating, by means of licence, permits or otherwise for the storage, transport, distribution, disposal, acquisition, use and consumption of any essential commodity which includes foodgrains, and that under the Defence of India Act or the Rules made thereunder, the State Government or its delegate is not authorised to make any order prohibiting the movement of any essential commodity from one State to another.

The order is also impugned by the petitioner on the ground that it was imperative under Rule 141 of the Rules for the District Magistrate to lay down his decision about the mode of publication of the impugned order, but respondent No. 2, the District Magistrate, did not specify the mode of publication of the order and that in the absence of such an expression the order shall be deemed to have come into force when it was published in the Rajasthan Gazette of 25-6-1964. For these reasons, it is prayed that the impugned order (Ex. 2) of 18th June. 1964 may be declared ultra vires of the powers of the District Magistrate, Kota, and a writ of prohibition may be issued to the respondents directing them not to arrest its partners Ram Gopal and Suraj Mal and prosecute them for the alleged violation of the impugned order. It is also prayed that the goods seized by the respondents on 21-6-1964 may be released, and by issuing a writ of mandamus they may be directed to return the seized goods to the petitioner firm, and the District Supply Officer. Kota may be restrained from cancelling the licence of the firm issued to it under the Rajasthan Food Grains Dealers Licensing Order and from forfeiting its security amount. It is also prayed that a writ in the nature of habeas corpus be issued to the respondents to withdraw the prosecution against Ghasilal. Mannalal Roopchand. Ram Gopal and Suraimal partners of the firm.

4. In their reply, the respondents did not generally controvert the facts as alleged by the petitioner in the writ application, but it is stat ed that it will be borne out from the note-sheet of the relevant file in the Collector's Office that the respondent No. 2 did determine the mode of publication of the impugned notification (Ex 2) as a result of which wide publicity was given to the impugned order as its substance was broadcast on All India Radio in its news item on that very day and also it was published in the newspapers on 19-6-1964. The Public Relations Officer Kota. also published this order on 19-6-1964. and it was put on the notice board of the Collector's office on 18-6-1964. It is contended that there is ample evidence to show that the grain merchants of Kota had the knowledge of the said order and still they deliberately violated it by despatching the foodgrain in collusion with the railway officers incharge of booking of goods. It is vehemently urged that the question of the publication of the notification is a question of fact which cannot be raised by the petitioner while invoking the extraordinary jurisdiction of this Court.

It is further averred that it was not necessary that each individual merchant should have been informed personally and it is urged that the petitioner firm was in the know of the issue of the impugned ordei before the goods were booked by it on 19-6-1964. It is however, admitted that the notification Ex. 2 was withdrawn by the District Magistrate on 6-7-1964 as it was so decided by the Chief Ministers in their conference held at New Delhi, but It is contended that the subsequent withdrawal of the impugned order does not absolve the partners of the petitioner firm from the criminal liability for contravening the provisions of the impugned order during its continuance. The facts alleging mala fides of the respondents are also denied by the respondents.

5. It is stated that to meet the emergency, the District Magistrate as a delegate of the State Government under Section 40 (2) of the Defence of India Act promulgated the impugned notification Ex. 2 in the exercise of his authority under Rule 125 and, therefore, the said notification was legal as Rule 125 of the Defence of India Rules confers powers and imposes duty on the State Government or its subordinate officers duly empowered in that behalf under the said Rules to issue such orders for the purposes mentioned in that rule as and when the exigencies of the situation demanded the issue of such order, and it was in the hour of emergency that the impugned notification was issued by the said authority which has the effect of nullifying the force of any other order issued in that behalf by any other authority whatsoever.

It is also submitted that the criminal proceedings had already been started against the partners of the petitioner firm and they must stand the trial in a regular criminal court where they will have ample opportunity to raise objection regarding the publication of the order which is purely a question of fact, and, therefore, this Court at this stage should not probe in the matter in the exercise of its jurisdiction under Article 226 of the Constitution.

6. Regarding forfeiting of the security is alleged that it has already been forfeited on 13-7-1964 by the District Supply Officer Kota and, therefore, the prayer of the petitioner in that respect has become infructuous. Under these circumstances, it is prayed by the respondents that this writ application should be dismissed.

7. Mr. Agarwal appearing on behalf of the the petitioner has developed his arguments by contending:

1. That the partners of the partnership firm have not committed any breach of the impugned order as it came into force only on 25-6-1964 when it was published in the Rajasthan Gazette Under Rule 141 of the Rules. It was incumbent for the District Magistrate to have mentioned in the order itself the mode of its publication adopted by the issuing authority and as it was not done, the order shall be deemed to have come into force after it was published in the Gazette Since the export of the grain had taken place on 19th June, 1961 no criminal proceedings could be launched against the partners of the firm. Under these circumstances, criminal proceedings initiated against them must be quashed.

2. That the impugned order is ultra vires of Rule 125 of the Defence of India Rules. His contention is that this rule provides that the Central Government or the State Government or any of its delegate under Section 40 (2) of the Defence of India Act can regulate by licence, permit or otherwise the production, manufacture, movement, transport, distribution, disposal, acquisition, use or consumption of articles or things of any description whatsoever, but there is no such authority given to the Government and its delegate that they may prohibit the trade altogether. By issuing the impugned order, the District Magistrate has prohibited the export of the grains mentioned therein from Kota District to any place outside Rajasthan. This order being violative of the guarantee embodied under Article 301 of the Constitution is illegal. It is also contended that the word 'regulate' in Rule 125 (3) (a) of the Rules does not include in it the power to prohibit the movement of the grain beyond the territonal limits of Rajasthan, but the impugned order has done so as it has totally stopped the inter-State trade in foodgrains which the District Magistrate was not empowered to do under the authority of the said rule. It is also argued in the alternative that if the word 'regulate' is held to include the power to prohibit the inter-State trade, then Rule 125 itself be declared ultra vires of the Constitution as it violates the provisions of Part XIII of the Constitution.

3. That the impugned order has the effect of discriminating between the State of Rajasthan and other States in India as it permits the grain dealers to carry on their trade only within the State of Rajasthan. Article 303 of the Constitution prohibits the Parliament as well as the State legislature to make any law giving or authorising the giving of any preference to any State over another or making or authorising the making of any discrimination between one State or another in matters of trade and commerce. Such discrimination is permissible only under Clause (2) of Article 303 when Parliament declares that it is necessary to enact a law to issue a legislative order for dealing with a situation arising from scarcity of foodgrain in any part of India, and that the power to enact a law or issue an order cannot be delegated to any authority. Since the impugned order contravenes the provisions of the Constitution it should be declared null and void.

4. That the Central Government while exercising its power under Section 3 of the Essential Supplies (Temporary Powers) Act, 1946, had already issued in 1954 the Coarse Grain (Removal of Control) Order which is stillin force. During the continuance of this order, the District Magistrate could not impose any restriction on the movement of jowar and maize which were covered by that order. It is urged that Clause 3 of 1954 order lays down that

'save as otherwise provided in any notified order made by or under the authority of the Central Government under Section 3 of the Essential Supplies (Temporary Powers) Act 1946 (XXIV of 1946) there shall be no prohibition or restriction on the movement of coarse grains and their products from any place in a State to any other place within or outside that State and the price, production, movement or distribution of coarse grains and their products shall not be regulated or controlled in any manner whatsoever,' and Clause (4) further provides that'this order shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than the said Act,'

and that Section 6 of the Essential Supplies (Temporary Powers) Act, 1946 makes the legislative intent absolutely clear that any order made under Section 3 of the Essential Supplies (Temporary Powers) Act, 1946 shall have effect notwithstanding anything inconsistent there with contained in any enactment other than this Act or any instrument having effect by virtue of any enactment other than this Act. Thus his argument is that in view of the existence of the Coarse Grain (Removal of Control) Order, 1954 the District Magistrate, Kota had no authority to impose any restriction on the movement of the coarse grain as defined in the said Act and even if he had passed the impugned order it could not be used to penalise the petitioner who had a right to despatch the coarse grain anywhere in India.

8. In support of his first argument. Mr. Agarwal has relied on the provision of Rule 141 of the Defence of India Rules which reads as follows:

'141. Publication affixation and defacement of notices.--(1) Save as otherwise expressly provided in these Rules, every authori ty, officer or person who makes any order in writing in pursuance of any of these Rules shall, in the case of an order of a general nature or affecting a class of persons, publish notice of such order in such manner as may. in the opinion of such authority, officer or person, be best adapted for informing persons whom the order concerns in the case of an order affecting an individual corporation or firm serve or cause the order to be served in the manner for the service of a summons in Rule 2 of Order XXIX or Rule 3 of Order XXX. as the case may be, in the first Schedule to the Code of Civil Procedure, 1908 (5 of 1908) and in the case of an order affecting an individual person (not being a corporation or firm) serve or cause the order to be served on that person--

(i) personally by delivering or tendering to him the order, or

(ii) by post, or

(iii) where the person cannot be found, by leaving, an authentic copy of the order with some adult male member of his family or by affixing such copy to some conspicuous part of the premises in which he is known to have last resided or carried on business or personally worked for gain and the reupon the persons. corporation, firm or person concerned shall be deemed to have been duly informed of the order.

2. If in the course of any judicial proceed ings a question arises whether a person was duly informed of an order made in pursuance of these Rules, compliance with Sub-rule (1). or where the order was notified, the notification of the order, shall be conclusive proof that he was so informed; but a failure to comply with Sub-rule (1)--

(i) shall not preclude proof by other means that he had information of the order.

(ii) shall not affect the validity of the order.

3. Any police officer, and any other person authorised by Government in this behalf may, for any purpose connected with the defence of India and civil defence, the public safety, the maintenance of public order, the efficienl conduct of military operations, maintaining supplies and services essential to the life of the community or the administration of these rules affix any notice to, or cause any notice to he displayed on, any premises, vehicle or vessel and may for the purpose of exercising the power conferred by this rule enter any premises, vehicle or vessel at any time.

4. Any person authorised by Government in this behalf may for any purpose mentioned in Sub-rule (3). by order direct the owner or other person in possession or control of any premises, vehicle or vessel to display any notice on or in the premises, vehicle or vessel in such manner as may he specified in the order

5. It any person without lawful authority removes, alters, defaces, obliterates or in any way tampers with any notice affixed or displayed in pursuance of these Rules, or contravenes any order under Sub-rule (4), he shall be punishable with imprisonment for a term which may extend to six months, or with fine, or with both.'

9. It is not denied by the respondents that the impugned order is of general nature with which every grain dealer in Kota District is concerned and this fact that the notification was published in the official Gazette on 25-6-1964 is also admitted, but it is contended by the respondents that publication in the Gazette does not help the petitioner as it is not the require ment of Rule 141 that the order shall come into force only after it was published in the Official Gazelle The argument of Mr. Agarwal is that the District Magistrate should have specified in the impugned order itself the mode of its publication and it was only after it was published in that manner that it could be enforced against the petitioner. His contention, therefore, is that the impugned order having not prescribed any mode of its publication if cannot he deemed to have come into force till it was published on 25-6-1064 in the Rajasthan Gazette.

The contention of the respondents, on the other hand is that the impugned order was given wide publicily by getting the substance of the notification broad-cast on All India Radio in its news programme and also by publishing it in the newspapers on 19-6-1964 and by affixing a copy thereof on a notice board of the office of the Collector. Kota on 18-6-64. It is further urged that there is sufficient evidence to show that the grain merchants of Kola bad the knowledge of the impugned notification Ex. 2, and that the petitioner despatched the grain even after knowing that its movement was banned under the impugned order

10. It may be noted that it is not the requirement of Rule 141 that the order to be issued under the provisions of the Defence of India Act or the Rules made thereunder shall come into force only after it was published in a manner prescribed by the order itself. It simply provides that the issuing authority should determine the manner in which it was to be published for the information of the persons concerned. If the information has reached the persons concerned then the question how it was conveyed to them would be of no consequence as Sub-rule (2) of Rule 141 shall be attracted and the validity of the order shall not be affected on account of the non-compliance of Sub-rule (1) of the said rule. In view of this provision of the law the only thing that we have to see is whether the grain merchants of Kota had the knowledge of the impugned order when they despatched their goods.

11. It may be mentioned that the petitioner has not filed any counter-affidavit to controvert the facts alleged by the respondents regarding the publication of the impugned order. In view of the conflicting averments made by the parties in this behalf, it is not possible for this Court to decide the question about the non-compliance of the provisions of Rule 141 It may be observed that the question whether Ex. 2 was duly published according to law is a mixed question of law and facts and the next question whether the petitioner had received information about it is a pure question of facts which we are not called upon to decide in a writ application. We are not expected in the exercise of our extraordinary jurisdiction to institute a regular enquiry to find out whether it was actually within the knowledge of the petitioner before the goods were despatched that the impugned order had been issued by the District Magistrate This contention in this petition cannot, therefore. achieve any result to the petitioner.

12. Regarding the second contention. Mr. Agarwal has referred us to the provisions of Section 3 (2) (23) of the Defence of India Act. 1962 and Rule 125 (3) of the Rules His argument is that the Stale Government or its delegate can issue an order under Rule 125 (3) only to regulate by issuing licences, permits or otherwise the production, manufacture, treatment, keeping, storage, movement, transport, distribution, disposal, acquisition, use or con sumption of articles or things of any description whatsoever, but it has no authority to prohibit the movement of the foodgrain from one State lo another. He further contended that the term 'regulate' as used in Sub-rule (3) of Rule 125 does not envisage a power to totally prohibit the movement of the foodgrain from Kota District to any other State in India, and as the impugned order prohibits the export of foodgrains from Rajasthan to any other part in India, it is ultra vires of Rule 125 of the Rules and it also violates the guarantee of free trade embodied in Article 301 of the Constitulion. In support of this argument, he has placed reliance on Municipal Corporation of the City of Toronto v. Virgo, 1896 AC 88, Bhola Prasad v. Emperor, AIR 1942 FC 17, Atiabari tea Co. Ltd. v. State of Assam, AIR 1961 SC 382 and Attorney General for Ontario v. Attorney General for the Dominion, 1896 AC 348.

13. Mr. Kan Singh, appearing on behalf of the respondents, on the other hand, urged that the impugned order does not totally stop the export of the foodgrain from Kota District to other places outside Rajasthan because the proviso to Clause (i) clearly mentions that nothing contained herein shall apply to the export of these foodgrains or any products there of not exceeding 5 kg. in weight in the aggregate by a bona fide traveller as a part of fits luggage, or on Government authority of the State Government, or that it shall be lawful for a person to export these foodgrains or any products thereof not exceeding 4 quintals for bona fide agricultural purposes; or by the cultivator who seeks to export for his personal consumption at his place or residence. These clauses, according to the learned Government Advocate show that the District Magistrate did not want to impose total prohibition on the export of the foodgrains, but he wanted to regulate the movement thereof according to the directions contained in the impugned order.

He also contended that under the general powers given by Sub-rule (2) of Rule 125, the State Government or its delegate has an authority to prohibit even the movement of food-grains from one place to another and as these powers emanate from the Defence of India Act which is enacted by Parliament to meet the emergency in the country, it cannot be averred with any justification that the restrictions imposed by the impugned order are violative of the guarantee given by Article 301 as this guarantee itself is subject to other provisions in Chapter XIII of the Constitution which provides that the Parliament may by law impose such restrictions on the freedom of trade, commerce or intercourse between one State or another or within any territory of India as may be required in public interest.

14. We have given our serious thought to the arguments advanced by learned counsel for the parties, and we feel that Mr. Agarwal is not correct in his submission that the impugned order is ultra vires of Rule 125 of the rules. Sub-rule (2)) of Rule 125 speaks of the general power of the Central Government or the State Government to issue order to regulate or 'prohibit' the production, manufacture, supply and distribution, use and consumption of articles or things and trade and commerce therein, if in its opinion it is expedient or necessary so to do. Under this power, which is vested in the Central Government or the State Government by virtue of the Defence of India Act and the Rules made thereunder, a citizen of India can be restrained even to trade in a particular commodity if it is found necessary or expedient for maintaining supplies essential to the life of the community. In face of the provision in Sub-rule (2) of the Rule 125 empowering the Central Government or the State Government to prohibit the supply, distribution, use and consumption of articles or things and even the trade therein f he contention of the learned counsel that the total prohibition of export of food-grains outside Rajasthan is ultra vires of Rule 125 becomes untenable and the argument of Mr. Agarwal that the term 'regulate' does not contemplate total restraint remains of no avail to him.

15. Mr. Agarwal then urged that the power to prohibit the trade or commerce in any commodity under Rule 125 (2) does not include a power to prohibit the movement or transport of that commodity from one place to another. His argument is that under the Defence of India Rules, 1939, Rule 81 (2) specifically conferred along with the power to prohibit trade or commerce in any article or thing power to put restriction on the movement of that commodity which shows that the movement of the commodity is not included in trade and commerce. According to him, it was on account of the provision of Article 301 of the Constitution that the power to restrict the movement of article or things is not conferred on the Government under Rule 126 (2) of the Rules as such a power runs contra to the guarantee of free trade as envisaged by the said Article. He further contended that the freedom of trade can be restricted by Parliament only by enacting a law under the power given Article 302 but that can be done only when the Parliament expresses in that enactment that a restraint imposed thereby is in the public interest.

16. We may mention that the concept of the freedom of trade as contained in Article 301 cannot mean absolute freedom from any restrictions whatsoever. The Supreme Court has discussed this aspect in the case of Automobile Transport Ltd. v. State of Rajasthan AIR 1962 SC 1406 and has laid down:

'In our view the concept of freedom of trade, commerce and intercourse postulated by Article 301 must he understood in the context of an orderly society and as part of a Constitution which envisages a distribution of powers between the States and the Union, and if so understood, the concept must recognise the need and the legitimacy of some degree of regulatory control, whether by the Union or the States; this is irrespective of the restrictions imposed by the other articles in Part XIII of the Constitution.'

17. Similar question came up for the consideration of their Lordships of the Privy Council in connection with the interpretation of Section 92 of the Commonwealth of Australia Constitution Act which is analogous to Article 301 of our Constitution and there it was observed in Commonwealth of Australia v. Bank of New South Wales. 1949-2 Ml ER 755 as follows :

'It is generally recognised that the expression 'free' in Section 92. though emphasised by the accompanying 'absolutely vet must receive some qualification. It was, indeed, common ground in the present case that the conception of freedom of 'trade, commerce, and intercourse' in a community regulated by law presupposes some degree of restriction on the individual.'

18. From these observations it is obvious that a citizen of India cannot claim absolute freedom of trade under Article 301 of the Constitution and he shall have to accept some kind of regulatory control, either of the Union or the State Governments in the interest of the community at large. The opening words of Article 301 themselves suggest that the freedom guaranteed under this Article shall be subject to the other provisions of Part XIII of the Constitution. Under Article 302 of the Constitution, Parliament has a power by enacting law to impose such restrictions on the freedom of trade, commerce or intercourse between one State and another, or within any part of the territory of India, as may be required in the public interest.

Mr. Agarwal has, conceded that the Defence of India Act is an Act made by Parliament and the rules made thereunder are made under the authority of Parliament, but he contends that no restriction can be imposed on the freedom of trade as Defence of India Act, 1962 has not been enacted under Article 302 of the Constitution nor does it declare that the restrictions to be imposed under it on the freedom of trade are required in the public interest. In our opinion, this argument of learned counsel is misconceived. If we throw a glance on the preamble of the Defence of India Act, 1962, we find that this piece of legislation was enacted with a view to provide special measure to ensure public safety and interest, and the power conferred on the Union or the State Government under Rule 125 to issue order of this nature is subject to the subjective determination of such an authority about the neces sity or expediency regarding the maintenance or increase of supplies or services essential to the life of the community or for securing the equitable distribution and availability of food-grain at the fair price.

This power under Rule 126 shall, therefore, he deemed to be used only for the public interest. In this view of the matter, if any restriction is imposed on the movement of the grain or other commodity in the exercise of the power conferred by the Defence of India Act or the Rules made thereunder, then it cannot be said to be violative of Article 301 of the Constitution as it shall be deemed to be imposed under the Act of Parliament in public interest.

19. As regards the objection that under Rule 125 (2) the Government or its delegate could prohibit the trade, but it could not put restriction on the movement of the food-grain it would suffice to mention that it is inherent in the act of carrying the trade in a particular commodity that the trader must have the right to move the goods in the manner he likes. If the trade is prohibited then the movement part of it is automatically affected, but if the impugned order purports to put partial restriction on trade it can do so by restricting the movement up to a particular limit. Such a power, in our opinion, does rest in the power to prohibit the trade. This objection of Mr. Agarwal does not cut much ice and is of little avail to him.

20. It was next urged that the Central Government while exercising its powers under the Essential Supplies (Temporary Powers) Act, 1946, promulgated the Coarse Grain (Removal of Control) Order, 1954 to ensure the regular movement of the coarse grain as defined in the said order within the territory of India. Mr. Agarwal also pointed out that the life of the Essential Supplies (Temporary Powers) Act, 1946 came to an end on 25-1-1955, but the conditions in India did not require that the control of the Central Government over the production, supply and distribution of the essential commodity should be discontinued and, therefore, Parliament enacted the Essential Commodities Act, 1955 as a special and a permanent measure and that by virtue of Sub-section (2) of Section 16 of the Act, the Coarse Grains (Removal and Control) Order, 1954 shall now be deemed to have been issued by the Central Government under the provisions of this Act of 1955. He further contended that each of these two Acts, viz. the Essential Supplies (Temporary Powers) Act, 1946 and the Essential Commodities Act, 1955 contained therein the following provision in Section 6.

'6. Effect of orders inconsistent with other enactments.--Any order made under Section 3 shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or any instrument having effect by virtue of any enactment other than this Act.'

This indicates the legislative intent in an unequivocal language that any order issued under the provisions of the said Acts shall have effect notwithstanding anything inconsistent there with contained in any other enactment and, therefore, he prays that as long as the Coarse Grain (Removal of Control) Order, 1954 is in force the impugned order cannot impose any restriction on the movement of the coarse grain which include maize and jowar exported by the petitioner firm. He also urged that to the extent the impugned order is inconsistent with the Coarse Grain (Removal of Control) Order, 1954, it should be declared inoperative.

21. Learned Government Advocate, on the other hand has contended that after the proclamation of emergency under Article 352 by the President of India, Parliament enacted a special measure in the form of the Defence of India Act, 1962 which also contained in Section 43 provisions analogous to Section 6 of the Essential Supplies Act, 1955. This indicates the mind of Parliament that any order issued by a competent Authority in the exercise of its power under the Defence of India Act or the rules made thereunder shall have overriding effect over all other orders passed under other laws which are inconsistent therewith. According to him. Defence of India Act was enacted by Parliament after the proclamation of emergency when Article 19 of the Constitution was suspended and the restrictions contained therein were removed from the way of Parliament to invest the Central Government and the State Government with unlimited power which may even go to the length of violating even the fundamental rights embodied in Article 19.

In these circumstances, Mr. Kan Singh urged that the District Magistrate, Kota, who was compelled by the circumstances to issue the impugned order in the exercise of his powers under the Defence of India Rules to meet the emergency, it will have the effect of repealing the Coarse Grain (Removal of Control) Order, 1954. In support of this argument, he referred to us the judgment of the Supreme Court in Harishaukar Bagla v. State of Madhya Pradesh, AIR 1954 SC 465 and relied particularly on the following passage.

'Conceding, however, for the sake of argument that to the extent of a repugnancy between an order made under Section 3 and the provisions of an existing law, to the extent of the repugnancy, the existing law stands repealed by implication, it seems to us that the repeal is not by any act of the delegate, but the repeal is by the legislative act of the Parliament itself. By enacting Section 6 Parliament itself has declared that an order made under Section 3 shall have effect notwithstanding any inconsistency in this order with any enactment other than this Act. This is not a declaration made by the delegate but the legislature itself has declared its will that way in Section 6. The abrogation or the implied repeal is by force of the legislative declaration contained in Section 6 and is not by force of the order made by the delegate under Section 3. The power of the delegate is only to make an order under Section 3. Once the delegate has made that order its power is exhausted. Section 6 then steps in wherein the Parliament has declared that as soon as such an order comes into being that will have effect notwithstanding any inconsistency therewith contained in any enactment other than this Act. Parliament being supreme, it certainly could make a law abrogating or repealing by implication provisions of any preexisting law and no exception could be taken on the ground of excessive delegation to the act of the Parliament itself. There is no delega tion involved in the provisions of Section 6 at all and that section could not be held to be unconstitutional on that ground.'

22. These observations of the Supreme Court, as is apparent from the opening sentence of the above paragraph, were made on the assumption that the provisions of the existing law (in that case the Railways Act) stand repealed to the extent to which they were inconsistent with or repugnant to the provisions of the Cotton Textiles (Control of Movement) Order, 1948, but their Lordships while dealing with the question whether the inconsistent provisions of the Railways Act were actually got repealed on account of the repugnancy with the Cotton Textiles (Control of Movement) Order, expressed themselves in a different way. The facts of that case were that the appellant Harishankar Ragla and his wife Smt. Gomti Bagla were arrested by the Railway Police for the contravention of Section 7 of the Essential Supplies (Temporary Powers) Act, 1946 read with Clause (3) of the Cotton Textiles (Control of Movement) Order, 1948, for carrying in the railway compartment 'new cotton cloth' weighing over six maunds, from Bombay to Kanpur without any permit under the Cotton Textiles (Control of Movement) Order, 1948. They were prosecuted for violating the provisions of the said Order. A question was therefore raised by Mr. Umrigar appearing for the appellant before the Supreme Court that Section 6 of the Essential Supplies (Temporary Powers) Act, 1946 was invalid as it had the effect of conferring power of the widest latitude to make any order inconsistent with the Railways Act, and pleaded that the provisions of Cotton Textiles (Control of Movement) Order, 1948 could not repeal the provisions of the existing law. It was in that context that Mahajan C. J., while delivering the judgment for the Court, observed as follows:

'In our opinion the construction placed on Section 6 by the High Court is not right. Section 6 does not either expressly or by implication repeal any of the provisions of pre-existing laws; neither does it abrogate them. Those laws remain untouched and unaffected so far as the statute book is concerned. The repeal of a statute means as if the repealed statute was never on the statute book. It is wiped out from the statute book. The effect of Section 6 certainly is not to repeal any one of those laws or abrogate them. Its object is simply to by pass them where they are inconsistent with the provisions of the Essential Supplies (Temporary Powers) Act, 1946 or the orders made thereunder. In other words, the orders made under Section 3 would be operative in regard to the essential commodity covered by the Textile Control-Order wherever there is repugnancy in this Order with the existing laws and to that extent the existing laws with regard to those commodities will not operate. By passing a certain law does not necessarily amount to repeal or abrogation of that law. That law remains unrepealed but during the continuance of the Order made under Section 3 it does not operate in that field for the time being. The ambit of its operation is thus limited without there being any repeal of any one of its provisions.'

These observations are very pertinent and apply with full force to the present case. If there had not been any provision like section 6 in the Essential Supplies (Temporary Powers) Act under which the Coarse Grain (Removal of Control) Order, 1954 was issued by the Central Government, then the impugned order would have held the field by virtue of Section 43 of the Defence of India Act and the Coarse Grain (Removal of Control) Order, 1954 would have become inoperative so far as the movement of the grains mentioned therein is concerned, as according to the aforesaid observations of the Supreme Court, the Coarse Grain (Removal of Control) Order, 1954, though it could not he repealed or abrogated on account of the impugned order, vet it could not operate in that field for the time being till the order issued by the District Magistrate was in force But the difficulty in this case arises be cause of Section 6 in the Essential Supplies (Temporary Powers) Act and the Essential Commodities Act. 1955 which are exactly simitar to the provisious contained in Section 43 of the Defence of India Act.

The existence of this provision in the aforementioned two Acts and the Defence of India Act, 1962 presents a ticklish problem as to which of the two inconsistent orders viz the Coarse Grain (Removal of Control) Order. 1954 of the impugned order issued by the (District Magistrate should give way to the other. It is, now settled law. see AIM 1954 SC 465 that the impugned order issued by the District Magistrate. Kota under the Defence of India Hides would not. by virtue of Section 43 thereof, go to repeal the Coarse Grain (Removal of Control) Order, 1954 promulgated by the Central Government under the provisions of the Essential Supplies (Temporary Powers) Act, 1946 and, therefore, in the absence of such repeal both the orders viz. the impugned order and the Coarse Grain (Removal of Control) Order, 1954 shall remain in force in spite of their inconsistency. The doctrine of repeal by repugnancy cannot, therefore, be attracted to to such a case.

23. Learned Government Advocate has however urged that the Defence of India Act has been enacted by Parliament after the emergency was declared under Article 352 and it being a speciat measure adopted to ensure the public safety and public interest empowering the Central Government and the Stale Government to issue order for the maintenance of supplied essentials to the life of the community, or for securing the equitable distribution and availability of any article at fair price should get precedence over the legislative measure adopted in peace-time and, therefore, order issued by the District Magistrate under the Defence of India Rules should hold the field in preference to the order issued under the Essential Commodities Act, 1955.

24. We find that the Coarse Grain (Removal of Control) Order, 1954 was issued by the Central Government under Section 3 of the Essential Supplies (Temporary Powers) Act, 1946. It carries a mandate that there shall be no prohibition or restriction on the movement of coarse grains and their products from any other place within or outside that State. It also provides that the said order shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than the said Act. The impugned order issued by the District Magistrate. Kota puts restriction on the movement of jowar and maize which, according to the definition given in the Essential Commodities Act, 1955, are coarse grain. These two orders are undoubtedly inconsistent with each other and both of them cannot be obeyed simultaneously and, therefore, one of them shall have to give way to the other.

We have observed above that the Essential Commodities Act, 1955 was enacted by Parliament to meet a situation created by the aftermath of the second World War which compelled the Central legislature to enact a measure whereby the Central Government could keep its control over the production or distribution of the essential commodities. To meet that situation, the Central legislature first enacted in 1946 the Essential Supplies (Temporary Powers) Act and when its life exhausted on 25-1-1955 Parliament had to adopt a special measure in the form of Essential Commodities Act, 1955 which conferred special powers on the Central Government and the Stale Government to issue orders to control the production, supply or distribution of essential commodities in the country. This Act of 1955 deals only with the essential commodities, and provides measure to regulate their production, distribution or supply, whereas the Defence of India Act, 1962 has been enacted by Parliament during the current emergency to provide for special measures as is clear from its preamble to ensure public safety and interest, the defence of India and civil defence and for the trial of certain offences and for matters connected therewith.

Parliament had to enact this measure because of the grave emergency created on account of the aggression of China whereby the security of India was threatened: therefore, special powers of general nature had to be given to the Central or the State Governments to meet the emergency. This, as a matter of fact, is a general law which deals with various contingencies including the supplies and services essential to the life of the community or for securing the equitable distribution and availability of any article or thing at fair prices, but the Essential Commodities Act, 1955 deals only with the control of production, supply and distribution of trade and commerce in essential commodities which shows that this is a special law that controls only the essential commodities The maxim Generalia Specialibus non derogant is, therefore, attract ed and when a special law is found inconsistent with or repugnant to the subsequent law of general nature which is not confined lo the subject-matter of the special Act. and where there is no express indication of the legislature that the special law will give way to the general law the provisions of the special law will bold the field.

Here we feel that the Coarse Grain (Removal of Control) Order, 1954 is quite com prehensive in terms and it covers the entire subject relating to the movement of the coarse grain throughout India The order issued by the District Magistrate. Kota, which is sought to be impugned by this application, is sharply opposed to it and tends to make it nugatory Both these orders cannot be reconciled because the order of 1954 says that no restriction can be imposed on the movement of the Coarse foodgrains within India whereas the imputed order restricts the movement of the grain including the coarse grain only within the territory of Rajasthan. The Coarse Grain (Removal of Control) Order, 1954, therefore, having been made under the provisions of a special law viz. the Essential Commodities Act, 1955 would govern the movement of the essential commodity in the country in preference to the impugned order that was issued by the District Magistrate under the Defence of India Rules which confer powers of general nature on the said authority.

25. There is yet another important aspect of the question which engages our attention in this case, The Coarse Grain (Removal of Con trol) Order, 1954 was issued by the Central Government under the authority of the Essential Commodities Act, 1955 a statute enacted by Parliament. This order provided in Clause 4 that it shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than the said Act, namely, the Essential Commodities Act, 1955. The impugn ed order, on the other hand, is issued by a subordinate authority viz., the District Magistrate Kota in the exercise of his powers under the Defence of India Rules. It is also to be noted that the former order was issued by the Central Government with a view to ensure a regular flow of coarse grain throughout the country, while the latter was issued by the District Magistrate to ensure the availability of grain within the State of Rajasthan. Under these circumstances, the question posed for our determination is whether a subordinate authority of the status of a District Magistrate while using his power under the Defence of India Rules can repeal or render the order of the Central Government which is obeyed throughout India inoperative for Kota District.

26. In this connection we may look (sic) to the provisions of the Constitution and its scheme. Ours is a federal Constitution and our founding fathers were not unaware of the tremendous problem of a federal structure in which sectional and local interest of which are inimical to the interest of the nation as a whole, sometimes grow. The strength of the Union under this system can be achieved only by providing a provision in the Constitution for minimising the inter-State barriers as much as possible so that the people may feel that they are the members of one nation though they may for the time being be residents of a particular geographical division The progress of the country as a whole also requires a free flow of commerce and intercourse as between different parts of the country without any barrier, so that the economic resources of the various parts may be exploited to the common good and advantage of the entire nation. This is very essential for a nation having a federal system of government. Their Lordships of the Supreme Court in AIR 1961 SC 232 have made very pertinent observations in this respect and they said;

'In drafting the relevant Articles of Part XIII the makers of the Constitution were fully conscious that economic unity was absolutely essential for the stability and progress of the federal policy which had been adopted by the Constitution for the governance of the country. Political freedom which had been won, and political unify which had been accomplished by the Constitution, had to be sustained and strengthened by the bond of economic unity. It was realised that in course of time different political parlies believing in different economic theories or ideologies may come in power in the several constituent units of the Union, and that may conceivably give rise to local and regional pulls and pressures in economic matters Local or regional fears or apprehensions raised by local or regional problems may persuade the Slate Legislatures to adopt remedial measures intended solely for the protection of regional interests without due regard to their effect on the economy of the nation as a whole. The object of Part XIII was to avoid such a possibility.'

27. The scheme of our Constitution is that in the field of legislation watertight compartments have been made for Parliament and State Legislatures in respect of the subjects mentioned in Lists 1 and 2 of the Seventh Schedule but for the subjects mentioned in the concurrent list a place of supremacy is assigned to Parliament with one exception which is contained in Article 254(2) of the Constitution. Item No. 33 of the Concurrent List of Schedule VII of the Constitution empowers both Parliament and the State Legislature to enact laws relating to trade and commerce in. and the production, supply and distribution of, goodstuffs including edible oilseeds and oils. On the above analogy, and in keeping with the spirit of the Constitution of India, we think that if any order is issued by the Central Govern ment which relates to the production, distribution or supply of foodstuffs, then it will get precedence over the order made by the State Government or its delegate.

Where there are two valid inconsistent orders, one made by the Central Government and the other by the State Government, on the subject covered by item No. 33 of the Concurrent List the order made by the Central Government should, in our opinion, hold the field, and the order issued by the State Government or its delegate would, to the extent of its repugnancy with the order made by the Central Government, be ineffective.

28. As a result of the above discussion, we hold that the impugned order issued by the District Magistrate. Kota, on 18th June, 1964 shall remain inoperative to the extent to which it is inconsistent with the provisions of the Coarse Grain (Removal of Control) Order, 1954, and the movement of jowar and maize from Kota District to any place outside Rajasthan cannot be restrained by virtue of the impugned order as long as the said order issued by the Central Government is in force.

29. The writ petition is, therefore, allowed and we direct that the respondents shall act in the light of the observations made above in matters relating to the seizure of the goods belonging to the petitioner and the cancellation of the licences of the petitioner firm under the Foodgrain Dealers Licensing Order. The petitioner shall get its costs from the respondents.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //