BRU BHUSHAN Vs. STATE OF JAMMU AND KASHMIR

JUDGEMENT

(1.) THE dispute in these writ petitions relates to the validity of three Orders, one dt. 13th Oct. 1978 and the others dt. 21st Oct. 1978 by which the State of Jammu and Kashmir sanctioned supply of crude oleo resin at the rate of 9,000 tonnes per annum to respondent No. 4, 4,000 tonnes per annum to respondent No. 2 and 4,000 tonnes per annum to respondent No. 3. All the three impugned Orders provided for supply of oleo resin at the rate of Rs. 260.00 per quintal exclusive of cost of tins, containers, sales tax etc. and under each of the three impugned orders, there was to be a moratorium on the rate for the first 5 years and thereafter the rate was liable to be increased or decreased according to the formula to be finalised between the Forest Department and respondent No. 2, 3 or 4 as the case may be. THE validity of each of these three impugned Orders has been challenged in the present writ petitions. THE grounds on which the challenge is based are, however, without substance and that is why we dismissed these writ petitions by an earlier Order made by us. THE reasons for which we made the Order dismissing the writ petitions are identical with the reasons given by us while disposing of Writ Petns. Nos. 481-82 of 1979 namely, Kasturilal Reddy v. State of Jammu and Kashmir, (1980) 2 SCR 1338: AIR 1980 SC 1992. But in order to appreciate the applicability of these reasons in the present writ petitions, it is necessary to briefly set out the circumstances in which the three impugned orders came to be passed by the State of Jammu and Kashmir.

(2.) THERE is a commodity called oleo resin which is a forest produce extracted from certain species of trees popularly known as chir trees. The process of extraction is called tapping. Oleo Resin is produced in only three States in the country namely, Himachal Pradesh, Uttar Pradesh and Jammu and Kashmir. It is an important raw-material for manufacture of rosin, turpentine and their derivatives. The quantity of resin extracted from Chir trees in Jammu and Kashmir was less than 6,000 tonnes in 1972-73 and its large potential had not been exploited until that time, though the States of Himachal Pradesh and Uttar Pradesh had been producing oleo resin for quite some time. In or about 1972, realising the importance of oleo resin as basic raw-material and with a view to developing industries based on oleo resin, the Central Government appointed a Committee called Central Co-ordination Committee for Rosin and Turpentine inter alia to look into the need for higher production of oleo resin with improved and modem methods with a view to improving quality and out-put, diversification of products by processing industries and export of sophisticated products. Pursuant to the recommendations made by this Committee, the State of Jammu and Kashmir adopted vigorous measures for increasing the production of oleo resin and as a result of these measures, during the years 1974-75 to 1978-79 the production of oleo resin went up considerably as disclosed by the following figures: <FRM>JUDGEMENT_354_2_1986Html1.htm</FRM>

(3.) THE first ground of attack against the validity of the three impugned Orders was that they created monopoly in favour of respondents Nos. 2, 3 and 4 and constituted reasonable restriction on the right of the petitioners to carry on business of manufacture of rosin and turpentine derivatives under Art. 19(1)(g) of the Constitution. We do not think there is any substance in this ground and it must be rejected. It is difficult to see how it can at all be contended that any monopoly was created in favour of respondents Nos. 2, 3 and 4 by the State Government by making the three impugned Orders. THE annual production of oleo resin in the State was in the neighbourhood of about 36,000 tonnes and out of them only 17,000 tonnes per annum were given to respondents Nos. 2, 3 and 4 and about 7,000 tonnes were reserved for the units in the public sector, leaving as much as 12,000 tonnes of oleo resin available for the other manufacturers. THE petitioners and other manufacturers did, therefore, have about 12.000 tonnes of oleo resin available for them. in the circumstances, no monopoly in regard to oleo resin could possibly be said to have been created by the State Government in favour of respondents Nos. 2, 3 and 4. Moreover, it maybe noted that what the State Government did under the three impugned Orders was not sale simpliciter of oleo resin but assured supply of oleo resin was guaranteed to respondents Nos. 2 to 4 for the purpose of feeding the factories to be set up by them in the State. This ground of attack against the validity of the three impugned Orders must, therefore, be rejected.