CHANDRASEKHARA PRABHU Vs. STATE OF KERALA

JUDGEMENT

(1.) In these original petitions the petitioners who are wholesale dealers in kerosene, who have 'got licences in that respect under the Kerala Kerosene Control Order, 1968 (shortly stated the Order) challenge the direction given by the Government by which they will have to pay what is called "Differential Cost" to the State Government in the matter of sale of kerosene. When a higher excise duty is levied the price of kerosene is refixed. At that time most of the wholesale dealers in the State will be having some stock of kerosene. Naturally they will be able to sell it at a higher price, as the refixation entails a higher price. It is this difference in price which the dealer might get due to the increase in price which is termed as 'differential cost'.

(2.) The petitioners purchase kerosene directly from Oil Companies and sell to the customers. The State Government fix the gross selling price of kerosene. The amount of selling price is arrived at after adding sales tax, loading, unloading, measuring, handling and shouldering charges, lorry hire, leakage, telephone charges and other incidental expenses for arranging despatch. The total price is calculated by the State Government on the basis of each increase in price due to increase in Excise duty and the price is communicated by District Collector through the Taluk Supply Officer. On the basis of the changed price the State Government direct the kerosene dealers that the price should be refixed

(3.) According to the petitioners the property in the goods, viz., kerosene Which is in stock at any given time had passed to the petitioners. The increase in price or decrease in price may be due to several reasons which cannot affect the petitioners' right in the goods. The Government is, therefore, not competent to claim the difference as "differential cost" and direct the wholesale dealers to remit the amount There is no contract between the Government and the dealers as such and the dealers are not agents of the Government. There is no statutory provision which would entitle the Government to claim the "differential cost" or fasten the dealer with a liability to remit the amount to the Government. It is stated that by fluctuations in price dealers trading in any commodity will either gain to lose. But that will not entitle the Government to claim from the dealers what they may gain; in the same way as the dealers cannot claim to recoup from the Government what they lose. The petitioners in both the writ petitions ask for appropriate writs to quash the orders by which they have been made liable for "differential cost".