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R. Ramanujam Chettiar Vs. the Commissioner and Secretary to the Government of Tamil Nadu, Food and Co-operative Dept., Madras - Court Judgment

LegalCrystal Citation
CourtChennai High Court
Decided On
Case NumberW.P. No. 1975 of 1981
Reported inAIR1982Mad261
ActsEssential Commodities Act, 1965 - Sections 3; Levy Sugar Supply (Control) Order, 1979; Constitution of India - Articles 39, 47 and 226
AppellantR. Ramanujam Chettiar
RespondentThe Commissioner and Secretary to the Government of Tamil Nadu, Food and Co-operative Dept., Madras
Appellant AdvocateP.R. Kumaramangalam and ;Kitty Kumaramangalam, Advs.
Respondent AdvocateAdv. General and ;C. Chinnaswami, Adv. ;for Govt. Pleader
constitution of india, article 47--fixation of higher quantity of sugar to higher income group is inequitable distribution of an essential commodity to the general public ; by the government order no. 128, food and co-operation, dated 24th february, 1981 which came into force on 1st march, 1981 there was a reduction of the quota sugar to three kilograme for card holders, whose monthly income ranges between rs. 500 and rs. 999. the petitioner's family consisted of six members and three kilograms of sugar was hardly sufficient. therefore he was forced to purchase sugar in open market at a higher rate. as the impugned government order had caused hardship to the petitioner and other citizens, the petitioner filed a writ petition for a certiorarified mandamus for quashing the said government.....1. the petitioner has prayed for a certiorarified mandamus for quashing the g. o. ms. no. 128 food and cooperation dated 24-2-1981, and to direct the respondents to fix the quota sugar for the petitioner's card as per law.2. the petitioner is a holder of a family card and his declared income is rs. 500 per month. he states as follows till february 1981, the petitioner was eligible and was receiving 5 kilograms of sugar every month on his ration and for his family at the control rate of rupees then, every card holder the said quantity every7.50 per kg.3. the jaggery which has all along been a cheaper substitute, is now being sold at rs. 4.50 per kg, whereas levy sugar costs rs. 3.50 per kg. as the impugned g. o, which has come into force on 1-3-1981, caused hardship to the petitioner and.....
1. The petitioner has prayed for a certiorarified Mandamus for quashing the G. O. Ms. No. 128 Food and Cooperation dated 24-2-1981, and to direct the respondents to fix the quota sugar for the petitioner's card as per law.

2. The petitioner is a holder of a family card and his declared income is Rs. 500 per month. He states as follows Till February 1981, the petitioner was eligible and was receiving 5 kilograms of sugar every month on his ration and for his family at the control rate of Rupees then, every card holder the said quantity every

7.50 per kg.

3. The jaggery which has all along been a cheaper substitute, is now being sold at Rs. 4.50 per kg, whereas levy sugar costs Rs. 3.50 per kg. As the impugned G. O, which has come into force on 1-3-1981, caused hardship to the petitioner and other citizens, he had perforce to seek remedy in this court by invoking Art. 226 of the Constitution.

4. He claimed that Government has created classification on the basis of income, which has no nexus to the objects sought to be achieved under Essential Commodities Act. When it is duty bound to protect economically weaker sections of the society, it allots more sugar to the higher income group and less quantity of sugar to the lower income group, thereby violating Art, 14 of the Constn, as the classification is arbitrary.

5. Sugar is an essential commodity for the up keeping of the human body, and being an instant form of energy which economically weaker sections of the people are in direct need they are forced to part with more money. The present arrangement evolved by the Government is opposed to the intendment of the Essential Commodities Act. When any other form of sugar is sold, at higher price than levy sugar, for securing an equitable distribution of it available at fair price, the present classification acts counter to the objectives required to be achieved under Essential Commodities Act. The present classification has no sanctity or rationale taking into account only the card holders' income and not the income of the entire family and the number of persons in the fan-lily and hence smacks of arbitrariness and is volatile of directive principles of State policy and also public interest. When sugar is needed for every human body, and levy sugar being the cheapest now available in the market, to allot more quantity of sugar to affluent people and less quantity to the weaker sections of the community and telling them that they can purchase in open market to meet their further requirements, if any, is against social justice in a Welfare State.

6.In the counter-affidavit it is stated that Government of India reintroduced the system of dual policy on sugar with effect from 19-12-1979, and under this scheme, 65 per cent of the production in sugar mills will be treated as levy sugar for distribution to general public at a price fixed by Government of India and the remaining 35 per cent to be sold by the Mills in open market without any price control. Levy sugar thus secured is allotted to State Governments by the CentralGovernment. Prior to 17-12-1979. open market sugar was being supplied to card holders through fair price shops at the scale of 5 kgs. per card per month in

Madras City, District Headquarters and card per month in other Municipalities and Town ships and one kg. per card per month in Town Panchayats and Village Panchayats. This has resulted in representations

being made by the public that rural card holders are not getting adequate quantity and the quantity to be distributed should be related to the income of the card holders. With effect from 1-1-1978, the levy sugar was being distributed on per capital basis at 425 grams per head per month, and it was found in practice having no relationship to the purchasing power and actual needs of the public. It was found that in a family having large number of members and not having capacity to purchase full quota, the supply was disproportionate to its needs. Whereas a family having purchasing power with needs for sugar, but with less number of members was getting less quantity. It is by taking these facts into consideration and to prevent the resale of levy sugar on premium by a section of cardholders, without actually consuming it, it was decided to distribute levy sugar on income basis, which has resulted in the impugned G.O. being issued, in and by which, the levy sugar came to be distributed as follows-

Income Per card per month

Urban areas Rural areas

Rs. 1000 and above per month 5 kgs. 3 kgs

Rs. 500 and up to Rs. 999 per month 3 kgs. 2 kgs.

Up to Rs. 499 per month 2 kgs. 1 kg.

This has resulted in the cardholders in rural areas being enabled to get increased supply up to a maximum of 3 kgs as against one kg only, prior to the coming into force of the impugned order.

7. Government of India introduced dual policy in sugar with effect from 1972 onwards and levy sugar was released from the Mills at such percentage, as may be fixed from time to time, at price notified, and the Mills were free to dispose of the balance stock in open market without any price control. This scheme was in force up to May 1978. Thereafter the control on sugar distribution was removed. The Government of India again reintroduced control with effect from 17-12-1979. Till 31-12-1977, when levy scheme was in force, the scale of supply was fixed on income basis only. It was only during the period from 1-1-1978 to May 1978 supply was made on per capita basis at 425 grams per head per month. Supply of levy sugar was also continued, after reintroduction with effect from 17-12-1979 of the levy scheme by the Government of India. Open market sugar was supplied to cardholders on 'an ad hoe' basis in fair price shops to ensure the supply of sugar at reasonable price up to 1:7-12-1979 in the proportion which has been mentioned above.

The basic principle of the levy system is to ensure part of the requirements of the consumers to be met at reasonable prices. Only to a reasonable extent levy sugar could be distributed, and Government is under no obligation to meet the full requirements of the consumers, since only 65 per cent of the production is taken over by the Government of India to be distributed at reasonable price. Any requirement over and above the levy supply should be met by the purchase of open market sugar. The system of distribution of sugar on family cards is in turn to ensure the availability of certain quantity of sugar at a reasonable price. No statutory rationing is in force, and hence the petitioner cannot claim that his requirement is more than what he is getting now and he cannot therefore contend that the policy of the Government is against law. Certain essential commodities are supplied on family cards under the Public Distribution System through fair price shops to ensure availability of a portion of the requirements of the consumers at reasonable prices subject to availability of stocks. The scales of sup, ply are fixed taking into account the consumption pattern, purchasing power of the cardholders and also the availability of stocks. The impugned order was passed to make sugar, which is an essential commodity, available at reasonable price to all consumers.

8. Statistics collected in 1973 shows the consumption pattern and the quantity of consumption of sugar has been proportionately more depending upon the income of the persons. By the present system, every family is assured of a reasonable quantity of levy sugar at controlled price, and if any family requires more sugar, it is open to it to purchase sugar in open market. This applies to all income groups whether it is lower income group or higher income group'. It was found that a family which has no purchasing power and need for sugar, was getting larger quantity due to large number of family members but it had not consumed the stocks, but resold the same at higher prices. Whereas families with lesser number of members having purchasing power and need for more sugar, were getting less. This could be remedied only by taking into account the purchasing power and hence the impugned G.O. is not violative of the provision s of the Constitution or opposed to public interest. The scale of supply fixed by the Government was evolved after takings into account 'the need for sugar, capacity to purchase and the availability of levy stock'. If any family needs more sugar it may purchase it in the open market. As the scale of supply had been fixed on a rational basis, it is now made available to both higher and lower income groups in spite of scarcity, and hence the petition deserves to be dismissed.

9. The first submission of Mr. Rangarajan Kumaramangalam, learned counsel for the petitioner, is that, Levy Sugar Supply (Control) Order, 1979, having been passed under S. 3 of the Essential Commodities Act (Act X of 1955) (hereinafter referred to as the Act), the manner of supply designed by the State Government for distribution of levy sugar should bring about the intendment of E. C. Act, so as to ensure equitable distribution to the public, and if it be shown that the method adopted for distribution does not bring about the avowed objects of the Act, it will have to be struck down. The respondent admits that levey sugar is secured from the Central Government and the method evolved is consequent to the powers conferred on it under Cl. 2 (4) (a) and (b) of Levy Sugar Supply (Control) Order 1979, hereinafter referred to as 'the Order'. Cl. 2 (4) are as follows: -

(4) Any levy sugar taken delivery of under sub-cl. (3) may be stored, distributed or sold- (a) where such sugar has been taken delivery of by the State Government in such manner as the State Government deems fit; (b) in any other case, in accordance with such directions as may be issued by the State Government or by an officer or authority empowered by the State Government in this behalf." Hence the right to distribute levy sugar is traceable to E. C. Act. The purpose for which the Act was passed is-

"An Act to provide, in the interest of the general public, for the control of the production, supply and distribution of and trade and commerce in certain commodities."

10. The relevant portion of S. 3(1) of the E. C. Act, 1'955 is to the following effect

"If the Central Government is of opinion that it is necessary or expedient to do so for 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) it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof, and trade and commerce therein."

Therefore, when an order is made by invoking S. 3, it must bring about 'equitable distribution and availability at f air prices' and it must be in the interests of general public.

11. Mr. Rangarajan Kumaramangalam by referring to the objects in the Bill would state that it was passed to check the inflationary trend in prices and ensure equitable distribution of essential commodities, Neither the Preamble nor the Objects and Reasons of the Bill, can control the impact of the section. But preamble is a good means of findings out the imperativeness felt and circumstances, which warranted passing of the Act and service as a key to the proper understanding of it. Courts will have, to interpret sections on the words used therein, but to a certain extent, Objects and Reasons could be looked into, to find out the reasons for which the Bill was moved in Parliament or Legislature, and what mischiefs the Act intended to remove.

12. Instead of proceeding on the basis of the objects of the Bill, it will be appropriate to refer to S. 3, to find out as to what was intended to be enforced or followed. It contemplates among others two essential aspects to be implemented i.e., 'equitable distribution of essential commodities and make them available atifair prices for the general public'.

13. It is claimed by the State Government that it took into account (1) the need; (2) capacity of the purchaser, and also (3) the availability of the stock, before deciding that income be adopted as the basis for distribution of levy sugar. It also asserts that the impugned order was passed to make sugar, an essential commodity, available at reasonable price to all consumers. Therefore, there can be no area of dispute that levy sugar is an essential commodity and it has to be equitably distributed at fair price. As for the price having been fixed at Rs. 3-50 per kg there is no dispute raised by the petitioner.

14. The salient point taken is that the present method of distribution of levy sugar allotting more quantity to persons with higher income does not result in equitable distribution. It is in this perspective; the impugned order will have to be tested. Therefore he lays emphasis on the point that the distribution of levy sugar stems out of the statutory provisions and not on any policy decisions; and the State is bound to evolve the appropriate and justifiable procedure for distribution, to achieve the objects of the Act and not on any other basis merely because in the Order under Cl. 2 (4) (a) it is stated 'in such manner as the State Government deems fit'.

15. He also refers to the decision in Diwan Sugar & General Mills (P.) Ltd. v, Union of India, , wherein it was held (at p. 631) that there is no doubt that the object of the Act is to secure essential commodities for the consumers i.e., general public at f air prices and fixation of prices at the ex-factory level is to ensure a fair price for the consumers and if such a system is not found to be satisfactory, the Government may fix both wholesale and retail prices also.

16. Thus it is clear that any orderly passed in exercise of the power under S. 3 of the Act, should also be aimed to achieve the objects of the Act and whatever consequent stops are taken under those orders should also be directed to achieve those objects and not otherwise.

17. By allotting more quantity of sugar to higher income groups and less quantity to weaker sections has it resulted in inequitable distribution?

18. The impugned order takes into account only the income of the cardholder, i.e. the person in whose name the card is issued, which turns out to be irrational and misguiding. If the cardholder is a pensioner or a person having lesser income than the other members of the family, to proceed on the basis of the income of the cardholder alone, results in inappropriate factor being taken into account. It is also claimed by State Government that one of the three factors it has taken into account is the capacity to purchase. If capacity is one of the predominating factors, it should be the capacity of all the members in the family, who would be in need of sugar, and it cannot be only on the income of the cardholder. In the present system the number of members in the family and to what extent they will be in need of sugar are avoided from being taken into account. Hence, if capacity to buy is a relevant factor, then the purchasing capacity of all the members covered by the family card has to be taken into account, hence, ascertainment of capacity under the present G.O. based only on the income of the cardholders is irrational and does not result in equitable distribution,

19. State pleads that it had taken into account the following three factors for adopting income of cardholder as basis for distribution of levy sugar. They are: "The scale of supply was fixed by the Government after taking into account the need for sugar, capacity to purchase and the availability of levy stock. If any family needs more sugar, it may purchase it in the open market.

20. To take them seriatim: Has the need for sugar been assessed in accordance with the Act? Where it is the duty of State to equitably distribute levy sugar among general public at fair price, if at all the need to get it at fair price is felt, it can only be reflected in the kitchens of the less fortunate, being the tweaked sections of the society', and not of what happens to affluent people, who can afford to get sugar in the open market, where it is available.

21. It is an undeniable factor that sugar is required for every human body as an instant source of energy, unless otherwise medically advised. It may be consumed either in the form of white sugar or brown sugar or jaggery, Capacity to purchase is different from need for sugar. There can be no two different yardsticks, in the required intake of sugar for human being, whether the person is affluent or belongs to the weaker sections of the society. The need for sugar cannot be determined on the basis of income, but on the basis of minimal requirements of every human being. Therefore, if less quantity of sugar is made available to cardholders with more members in the family, it would only result in the nutritional level being reduced, when under Art. 47 of the Constitution it is provided that the "State shall regard the raising of the level of nutrition and the standard of living of its people and the improvements of public health as among its primary duties."

22. Sugar is imperative to build up nutritional content in human body and State while selling it, has to devise its system as to sub serve these orders and not to overlook them. Hence, in evolving the manner of distribution through State it must not swerve away from these to be achieved, whereas assessment of need has been oriented and coupled with income and not by reference to the objectives to be achieved, under the Act and the Constitution. Therefore the need for consuming sugar cannot be related to income but should be looked upon on the basis of minimal requirements of each individual, which has been overlooked in passing the impugned order.

23. The next aspect taken into account is 'capacity to purchase'. Can purchasing capacity be a relevant factor or what should have been done is to supply the requirements of weaker sections of society, which should have prevailed, with State particularly when levy sugar is sold at fair price? Is it the ability to buy without experiencing strain of purchase or to make levy sugar available to less fortunate to the extent needed for them and thus bring it within their capacity that should prevail for satisfying the requirements of the Act?

24. The directives in the Act on this essential aspect had not been properly applied when essential commodities are to be distributed on equitable basis and at fair price. This statutory prescription is intended to protect the less fortunate and such sections of the Society with Meagre income from the harmful effects of being compelled to buy their basic requirements at higher prices. One of the objects in the moving of the Bill was to protect them from inflationary trends, which impelled the passing of the Act. If capacity to purchase is to be looked into, without any reference to any of the objects to be achieved under the Act, then certainly persons who are possessed of more money can purchase anything and everything whether there is absolute need for them or not. Why then requisition sugar under levy scheme from sugar mills?

When distributing levy sugar, it is obligatory on the State to focus on the capacity of the purchasers in the correct perspective, bearing in mind the circumstances in which the weaker sections of the Society are placed and the necessity for providing them their basic requirements in life, at fair price. When an essential commodity is required for sustenance of such people, with their meagre resources, they cannot get it, unless priced less, and reserved for them in larger quantities. If they are to buy at a higher price, they would be compelled to forego it when their chance to get sugar is thus limited, it is all the more necessary to enable them to have it within their means or capacity. If only the aspect of capacity had been applied in this correct perspective, it would have resulted in more sugar given to them than to the affluent people or at least distributing it on per capita basis.

25. A person having lesser income certainly cannot, without experiencing shortage of funds, buy sugar, at market rate, which was claimed to be ranging around at Rs. 7-50 per kg where as if made available at levy sugar rate, whatever he requires up to permissive limit, he will avail of and if not, forgo the supply earmarked for him.

26. It is not for the State to presume that less fortunate will not be in need of sugar, and that, even in getting an essential commodity, they should be less fortunate. In this context, it is pertinent to refer to a claim made by the petitioner that as on date jaggery is being sold at Rs. 4.50 per kg whereas levy sugar is sold at Rs. 3.50 per kg. He asserts that no other substitute for sugar is available at a cmtless than levy sugar. This claim is not refuted in the counter affidavit filed by the State. Therefore, as on date, it is only the levy sugar which is the cheapest form of nutrition and which is required for the weaker sections of the public, and to tell them that to supplement their needs, they should buy in open market at higher price like Rs. 7-50 per kg is an unreasonable approach and would further reduce their capacity to meet other requirements in life. It is only families of less income, which are in need of essential commodities to be supplied at fair prices, and the aim of the State should be to enable them to secure as much quantity as may be possible, from and out of the stocks entrusted to the State Government by the Central Government, under levy scheme.

27. It is claimed by the State that 11 is under no obligation to meet the full requirements of the consumers, when only 65% of the production is taken over by the Government of India, as levy sugar. But whatever quantity is allotted to the State Government has to be equitably distributed, and in evolving the method of distribution, it shall not result in less fortunate being placed in a disadvantageous position by being allotted less quantity, particularly when the cost of levy sugar is disproportionately low, and when it has become the cheapest form of sugar available in market. If affluent cardholders are given more quantities of the cheapest form of sugar then such a system is contrary to the provisions of the E. C, Act, and does not bring about an equitable distribution. Larger quantities supplied by adopting income as the basis, has now resulted in families which can well afford to buy open market sugar, being enabled to secure the required sugar at the cheapest rate prevailing in the country, whereas families having lesser income, but having the same number of members are compelled to buy sugar at more than double the price of levy sugar. The main aim in compelling sugar mills to part with 65% of their stocks at far less price is defeated by Government of Tamil Nadu issued larger quantities to persons with better income, 28. Under the present system, the income.

28.Under the present system, the income of the cardholders is divided into their groups as above stated. To find out far divided into three groups, as above stated. To find ou4 how far from the view point of capacity to purchase this method results or not in equitable distribution, the following comparative analysis will disclose that what should be aimed at is to make it available within the capacity or reach of every, citizen and not whether he has the capacity to buy or not. It is the concern 01 the individual to buy, if he wants, or forgo, if he cannot afford.

29. But when he/she decides to buy, it shall be available on equitable basis in a family where the cardholder earns Rs. 499 per month; the family gets two kgs of levy sugar. Whereas a family with same number of persons in which the cardholder earns Rs. 1000 per month gets 5 kgs of levy sugar, The cost of three kgs. of levy sugar is Rs. 10-50. Can it be said that the family which gets 2 kgs of levy sugar and which is in need of 5 kgs may not afford to pay Rs. 10-50, but may afford more than double that amount, if that family is to purchase sugar in open market? In the counter-affidavit, the State has taken up the stand that if such families require over and above the levy sugar, they may purchase in open market. If for satisfying their requirements, in the opinion of the Government, less fortunate families have the wherewithal to go to open market, can it be said that they do not have the capacity to buy sugar at concessional rate, if same quantity is allotted to them? The primordial purpose for which essential commodities are distributed through public distribution system by invoking the provisions of E. C. Act, is devoted to make these commodities available to weaker sections of the Society, at fair prices, and that, within their capacity they could get them, and their inability to buy in open market should not stand in their way of consuming or getting essential articles/goods.

30. Looked at from this viewpoint capacity to purchase which has been taken into account, as one of the factors has not been correctly focused at provisions of the K C. Act, but on a general impression derived from statistics of 1973, that a person is in need of more sugar, having more money and having capacity to purchase more sugar, State should give him more quantities. 'Capacity to purchase' is only ability to buy or what a person can afford, which is an irrelevant factor, if more quantity is allotted on ability to buy. This has no nexus with the objects to be achieved under the Act.

31. Poor people will be highly disheartened to read the claim of the State Government in the counter affidavit, wherein it is stated -

"If only family needs more sugar, it may purchase it in the open market. This applies to all income groups whether it is lower income group or higher income group."

No Welfare State can ever look upon the scheme of distribution of essential commodities in this manner, being fully aware that the lower income groups, when in need of essential commodities should be allowed to purchase at minimal prices.

32. The third aspect taken into account is availability of levy sugar. It is only from and out of the quantities available, the equitable distribution has to be achieved, but merely because less quantity than what would be required for total consumption in the State is allotted, it would not justify supplying more quantity of sugar to cardholders of higher income. It is only when the available quantity is less, the necessity arises for providing less fortunate with their required food articles at fair price leaving it to the higher income group to secure its requirements in the open market, where the articles are available, but at higher prices. The system to be followed, under levy scheme is different, from that would obtain when statutory rationing is in force, in a contingency when articles are under scarce supply and not available for one and all, within easy reach, Alongside levy sugar, when sugar is made available in open market, the approach should be only to provide the less fortunate with their required supplies by a method where it does not tilt in favour of higher income group.

33. There coull be no infirmity in taking into account the quantity allotted to the State as a factor for fixing up the quantum of sugar that could be supplied on an equitable basis. A consumer cannot demand that the entirety of his requirements should be met from and out of levy sugar, if the State is not possessed of any sufficient quantity to satisfy the requirements of all the consumers in this State.

34. The next line of attack on the impugned order is that, the State which has intended in distribute essential commodities, has to avoid any form of irrational distribution of levy sugar, unjustifiably among the sections of the public and particularly to the detriment of weaker sections of the society. Adoption of income as the basis without reference to the needs of all the members under the cardholders, or about the minimal requirements of every person to secure sugar for his sustenance at fair price but to confer upon people with higher income the benefit of securing sugar at the lowest price, acts against directive principles of the State policy, and also violates Art. 14 of the Constitution. Classifying citizens on Income basis is admissible, as found in levying higher rate of taxes on persons earning more, but what is being considered with reference to impugned order, is about allotting more quantity to affluent sections of society, when it must be to help the lesser income group to get their required quantities. It may be based on scientific assessment of minimal intake of sugar required for each individual in conjunction with quantity available with or allotted to the State. When sold at cheapest rate it may evolve a method which may even result in less fortunate being given more quantity, to bring about equities, in their having required sugar in their kitchen within their capacities.

35. Hence, there is no nexus between the quantities fixed on income basis or classification, adopted in the impugned G.O. Counsel for the petitioner refers to the decision in the Special Courts Bill 1978, , wherein it has been held that there must be an

intelligible differentia when classification is adopted, failing which it would result in such classification being struck down. While dealing with In re Special Courts Bill 1978 on the aspect of providing a special procedure, for trial of certain types of cases, it is stated (at p. 505) as follows: -

"If the classification was valid persons who were grouped together and who were distinguished from others who were left out of the group on an intelligible differentia could legitimately be tried by a different procedure even if it was more onerous, provided the differentia had a rational relation to the object sought to be achieved by statute in question."

36. Classification adopted, must establish that it is formulated to achieve the objects enshrined in the statute. There can be classifications of affluent or middle class or weaker sections etc., of the public, which in fact exists. But what is required of the State to justify is, by adopting such a classification for the distribution of levy sugar and fixing higher quantities for better-placed families it sub-serves the objects to be achieved under the Act. If by such a classification, the well to do people are supplied with more quantity of sugar at the cheapest rate, which in turn results in lower income group, when in need of sugar to purchase it in open market at more than double the price of the levy sugar, then the classification is irrational, unintelligible and unjust.

37. He then refers to the decision in R, D. Shetty v. international Airport Authority, wherein it has been held as


"After attainment of independence and during the past three decades, the Government being conscious of socio-economic justice and functioning as a welfare State it has become the dispenser of special services and provider of a large number of benefits to public. The valuables dispensed by Government take many forms, but they all share one characteristic and they are all of several kinds and what the Government gives may be in the nature of legal rights but the large majority of them are in the nature of privileges. They are all not to be regarded as guarantee furnished by the State but blessed with legal protection and therefore the State cannot withhold, grant or revoke such privilege at its pleasure. Some interests in Govt. largesse formerly regarded as privileges, have been recognised as rights while others have been given legal protection not only by forgoing procedural safeguards but also by confining/structuring and checking Government discretion in the matter of grant of such largesse. The discretion of the Government has been held to be not unlimited, in that the Government cannot give or withhold largesse in its arbitrary discretion or at its sweet will. The Government while dealing with the public and granting largesse it can never act arbitrarily like a private individual and deal with citizens as it pleases, but its action must be in conformity with standard or norm which is not arbitrary, irrational or irrelevant. If the Government departs from such standard or norms, its action would be liable to be struck down, unless it is able to show that the departure made by ill was not arbitrary, but based on some valid principle, which in itself was no irrational, unreasonable or discriminatory.

38. To proceed on these lines, levy sugar, which is requisitioned by invoking E. C. Act, cannot be distributed by the State Government by adopting a method which enables better placed persons to get more sugar at the cheapest rate.

39. It is claimed that by allowing the lower income group to avail of sugar on per capita basis or on an 'ad hoc' basis, it has resulted in families which have no capacity to purchase levy sugar, and sell at higher price. When the Government assumes responsibility of fair distribution of essential commodity by passing "the Act" and "Orders" there under, it is expected to enforce the distribution system effectively and efficiently. If there are abuses committed, it is duty bound to take prompt action. Because of difficulties countenanced to prevent such contraventions, it cannot adopt a classification to the detriment of the weaker sections of the Society for whose benefit alone, Government of India has assumed powers to collect by way of levy, 65% of the production of sugar, at a far less price than the real value of the sugar.

40. Art. 39(e) of the Constitution is referred to, to contend that the State shall in particular, direct its policy towards securing the operation of the economic system, in a manner which does not result in the concentration of wealth to the common detriment. If the required quantity of sugar is supplied at a lesser rate to well to do families, it results in more concession extended to them which in turn allows only lesser quantity made available to lower income groups, and thereby force them to buy sugar at higher rate, which would erode their resources and in this way, it acts against directive principles contained in this Article. It is obvious that no distribution system can be so evolved, to retard the achievement of any of the directive principles in the Constitution.

41. Article 47 of the Constitution is also referred to and to a certain extent it is also relevant in the sense that the level of nutrition of the people will have to be improved and admittedly as on date when levy sugar is the cheapest source for instant energy to be acquired by the weaker sections of the people, the classification adopted has not taken note of this Article.

42. The next objection is that, evolving a procedure in 1981, State had relied upon a survey made by the Department of Statistics in 1973: it is justifiably claimed that it cannot relate to present circumstances. It is undeniable that there has been rapid change among the -people, regarding the pattern of consumption of commodities. At no distance past, we consumed beverages with sugar in villages, whereas presently sugar has found its way even to remote hamlets and asked for as a basic household requirement. When noticeable changes have taken place in the consumption pattern of food it cannot be said that the department of Statistics has surveyed the consumption existing as on date. Counter-affidavit does not anywhere state that any statistics during the past eight years had been prepared, and even if available, while passing the impugned G.O. they were taken into account. The State cannot rely upon decrepit statistics.

43. The next aspect is, whether there was need for introducing this method when with effect from 1-1-1978, levy sugar was being distributed on per capita basis at 425 grams per head per month, What is claimed is, large number of families have not consumed but resold for higher prices. Further in Assembly it was demanded that income should be the basis and that rural cardholders were not getting adequate quantities. As already stated these are not sufficient grounds to fix quantities to be supplied, as evolved in the impugned G.O. It is common practice and knowledge that any commodity when distributed under public distribution system, will have to take into account the individuals as a predominating factor, and if the State is not possessed of sufficient quantity for distribution, it has to reduce the quantity per head. Merely because rural cardholders experienced difficulty, it would not be a justification to issue larger quantities to

higher income groups. When it is possible to distribute with a tilt in favour of less fortunate by taking into account the number of persons who are covered by a family card, depending upon the quantity allotted to State. Merely because some have sold sugar and the State had not taken stern steps against them, the entire lower income group should not be deprived from securing their required supply at fair price and in an equitable manner. Rather, the aim must be so directed to give them their entire requirement, when the cheapest rate is fixed for levy sugar. It is not claimed in the counter-affidavit that by allotting levy sugar on per capita basis it has resulted in in equitable distribution or that it could not be sold at fair price to the public.

44. The learned Advocate General in meeting these points would plead that there has been a certain classification adopted for rural and urban people, and when the consumption pattern in respect of sugar is different from the consumption pattern for other commodities, the income of the cardholder alone being taken into account for fixing higher quantities to them, has not resulted in inequitable distribution. He further contended that what was required is the household consumption or requirement of families. Less fortunate people do invariably consume beverages outside their household during the course of their employment. They buy in canteens or hotels or in other places and therefore, what was required to be looked into was their household requirement of sugar, and not otherwise, and that quantities fixed have found acceptance with them and they are satisfied.

45. As for the nutritional aspect, he contends that the quantity of sugar required is available in different forms outside the household, and when the sale of levy sugar is well balanced, the impugned G.O. had-not resulted in any hard ship to any section of the society, where as when the earlier procedure on per capital basis was enforced, several representations were received from the public about inadequate supply to rural card raised in making a supplied on holders and the issue was ask the Legislative Assembly by demand for levy sugar to be income basis and not on flat basis.

46. As for the categorization of cardholders on their income into three groups, he pleads that it has to be fixed within certain brackets of income, and it has not been shown as to how far it prejudices the larger sections of the public.

47. He refers to cl. 2 (4) (a) of Levy Sugar Supply (Control) Order, 1979, which confers the power on the State Government to store, distribute or sell sugar in such manner as the State Government deems fit. Hence his contention is that, it being entirely left to the State Government to evolve any method it chooses to adopt, it is not justiciable in court.

48. This contention lacks strength in that it is not a policy decision or an administrative Act wherein the State Government can act without being circumscribed by any provisions on any statute or the provisions of the Constn. After the decision of the Supreme Court in when the Government while dealing with the public and granting largesse it can never act arbitrarily, but its action must be in conformity with the standard which is rational; and more so when under the provisions of Act, it is bound to bring about equitable distribution among the general public, the affected person, has a right to challenge the inequitable distribution by the State of a commodity, which is essentially needed by him for his sustenance. Therefore the enablement provided under cl. 2 (4) (a) of the 'Order' has not invested the State Government with any uncontrolled and unbridled -power to decide on the basis without being questioned by affected citizens. Hence, it is for the State to justify that the method evolved by it, is equitable and the object or the purpose for which sugar is requisitioned from sugar mills is utilised to bring about the equitable distribution among the general public.

49. In the light of what has been stated above, fixation of a higher quantity of levy sugar to higher income group having not resulted in equitable distribution of an essential commodity to the general public, the impugned G. 0.) deserves to be quashed. Since quashing the impugned order with immediate effect would result in dislocation in supply of sugar and the general public would thereby be greatly affected, this court considers that it would be just and proper to grant the relief of certiorarified mandamus as prayed for, operating on and from f-1-1992, within which time, it is well open to the State to evolve a method of distribution in accordance with the law, failing which the writ of certiorarified mandamus would become operative on and from 1-1-1982.

50. The petitioner being a person with declared income of Rs. 500 per month has taken up the task of instituting the proceedings so as to benefit the general public apart from himself in bringing about equitable distribution of an essential commodity and hence he deserves to be granted costs in this writ petition.

51. In the result, the writ petition is allowed with costs. Advocate's fee is fixed at Rs. 250/- (Rs. two hundred and fifty).

52. Petition allowed.

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