B VISWANATHIAH AND COMPANY Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) The two appeals and the three Writ Petitions challenge the validity of the provisions of the Mysore Silkworm Seed and Cocoon (Regulation of Production, Supply and Distributions) Act, 1959 (Act No. 5 of 1960, hereinafter referred to as the impugned Act. The challenge was repelled by the Karnataka High Court by its common judgment dated 9-9-1980 in two writ petitions, which is the subject matter of appeals. It is perhaps in view of this judgment that Writ Petitions Nos. 5548-5550 of 1980 have been filed directly in this Court raising a similar contention.

(2.) At the outset, it is necessary to clarify two important points. The first is that the validity of the Act above mentioned and certain notifications issued thereunder were challenged in Civil Appeals Nos. 450 and 451 of 1966 and 542 of 1964. These civil appeals were disposed of by a judgment of this Court dated 6-1-1967 in State of Mysore and others vs. Hanumiah, 1967 SC (Notes) 33. By the said judgment this Court repelled the contentions then put forward. The validity of certain provisions of the impugned Act had then been challenged on the footing that the said provisions as well as the rules made and the notifications issued thereunder imposed unreasonable restrictions on the fundamental right of the petitioners to carry on trade or business under Art. 19(1)(g) of the Constitution. Again, the Mysore High Court in Mohammed Hussain vs. State of Mysore (W. P. 45 of 1971) and this Court in Syed Ahmed Agha vs. State, AIR 1975 SC 1443) were called upon to consider contentions as to the validity of certain amendments effected by Mysore Act 29 of 1969 to the impugned Act, in the light of the provisions of Arts. 301 to 304 of the Constitution of India. The contentions were repelled with the result that the statutory regulations providing for protection to rearers by the establishment of regulated cocoon markets and forbidding the sale or purchase of silk worm cocoons except in such markets were held to be valid. The present challenge, however, is on different grounds. The contention now is that certain amendments effected to the impugned Act by Karnataka Act No. 33 of 1979 have to be struck down as the State Legislature was not competent to enact the same. Thus, the contention now addressed is different from those which were considered by this Court on the earlier occasions. The second aspect which we wish to clarify at the outset is that though several grounds were raised before the High Court as well as in the writ petitions. This was that the impugned provisions, the argument before us was limited to a single contention, lack legislative competence after the enactment, by Parliament of the Central Silk Boards Act (Act 61 of 1948, (hereinafter referred to as the Central Act) which contains a declaration contemplated under Entry 52 of List I in the Seventh Schedule to the Constitution of India. We shall be addressing ourselves only to this argument.

(3.) Mysore Act 5 of 1960 was passed since it was considered expedient to consolidate the laws providing for the regulation of the production. Supply and distribution of silk worm seed and cocoon in the State of Mysore. This Act contained several restrictions in regard to the production, supply and distribution of silk worm seed and cocoon. Basically, sections 3, 4, 5, 6, 7 and 8 of the Act required a person to obtain a licence for production, sale and distribution of silkworm seed, for rearing silkworms from silkworm seed, for possession of silkworm seed, for disposal of silkworm cocoons for reeling or for reproduction, for sale or purchase of silkworm cocoons for reeling, and for carrying on the business of reeling silk worm cocoons. Section 10 enabled the Government to specify the manner of marketing the above goods, the places at which cocoon markets, cocoon market yards and cocoon stores could be located, specify the sericultural areas to be served by each cocoon market assign zones and markets in which any licensed buyer could carry on his business. It also provided that all transactions involving the sale or purchase of cocoons in a cocoon market shall be by weight, in open auction and in cash. The above Act, (and in particular the provisions contained in Ss. 6 and 7, was amended by the Karanataka Act 29 of 1969. But these amendments are not relevant for our present purposes. There were further amendments effected to the Act by Karnataka Act 33 of 1979. The petitioner is challenging the amendments carried out by this Act. The principal amendments carried out were, briefly, these. References to Mysore were replaced by references to Karanataka. In the preamble, in addition to the to silk worm seed and cocoon, reference was added to silk yarn. Definitions of silk yarn and various categories thereof were inserted. Section 5A was introduced under which no person could be in possession of silk yarn in excess of a prescribed quantity unless he is a reeler, a licensed trader, a twister, a weaver or a person authorised in writing by the prescribed officer. Section 10A provided for the establishment of silk exchanges at specified places. It enabled the Government to appoint for each silk exchange, a silk Market Officer and also to constitute a marketing committee with the Market Officer as the Chairman and with representatives of reelers, twisters and traders for regulating the conduct of business in the exchange. It also provided that all transactions involving sale or purchase of silk yarn in a silk exchange should be by weight, by open auction and in cash. Section 8A placed certain restrictions on reelers, twisters and traders after the establishment of a silk exchange. It prohibits a reeler or twister from selling or agreeing to sell silk yarn reeled or twisted by him. It permitted only licensed traders to purchase or agree to purchase silk yarn from a reeler or a twister and that too only in a silk exchange and in accordance with such conditions and in such manner as may be prescribed. Sub-section (2) of S. 8A provided that no person shall, except in such silk exchange, use, or permit the use or assist in the use of any building, room, tent, enclosure, vehicle, vessel or place for the sale of silk yarn by or purchase of silk yarn from a reeler or a twister or in any manner aid or abet the sale or purchase of silk yarn. To put it very shortly, the amendments of 1979 imposed on the production, supply, distribution and sale of silk yarn restrictions in a manner more or less analogous to those that earlier existed in respect of silk worm seeds and cocoons,