B. NARASIMHALU CHETTIAR Vs. CENTRAL GOVERNMENT

JUDGEMENT

(1.) ALL these writ petitions raise a common question regarding the validity of Rule 3 (ee) of the Gold Control (Licensing of Dealers) Rules, 1969, hereinafter referred to as the Rules, as amended by the Government of India notification dated 27 -12 -1972, published in the Gazette of India Extraordinary on 27 -12 -1972. The validity of this rule is challenged from different angles as being unconstitutional violating the fundamental rights of the petitioners under Article 19 (1) (g) of the Constitution of India and as conferring an unguided power on the licensing authorities and therefore offending Article 14 of the Constitution of India and as being outside the rule - making power of the Central Government itself. It was also challenged on yet another ground which has relevancy to the year 1973 only. I shall refer to that also in the course of this judgment.

(2.) ALL these petitioners have been licensed as dealers under Section 27 of the Gold Control Act 1968 (Central Act 45 of 1968) hereinafter referred to as the Act, for the year 1972. Most of them claim to be dealers in gold even before the Act came into force. Rule 3 (a) of the rules requires that an application for renewal of a licence should be made in the prescribed form at least one month before the expiry of the period of validity thereof. In the present cases, the licences which the petitioners were holding for the year 1972, were to expire on 31 -12 -1972, and therefore they should have made their applications for renewal on or before 30 -11 -1972. Admittedly the petitioners had made their applications before that date. It is unnecessary for me to refer to the provisions of the Act and the rules as well as the objects sought to be achieved by the Act for the simple reason that they have been elaborately set out in the two judgments of the Supreme Court, namely, Harakchand Ratanchand Banthia v. Union of India, AIR 1970 SC 1453 and Badriprasad v. Collector of Central Excise, Sarvodayanagar, Kanpur, AIR 1971 SC 1170. All that is necessary for the purpose of understanding the point raised in these writ petitions is to refer to Chapter VII of the Act which deals with dealers and e provisions contained in Section 27 which occurs in that Chapter and deals with licensing of dealers. Sub -section (1) of that section states that save as otherwise provided in that Act, no person shall commence, or carry on, business as a dealer unless he holds a valid licence issued in that behalf by the Administrator. Sub -section (2) states that a licence issued under that section shall be in such form as may be prescribed, shall be valid for such period as may be specified therein, may be renewed from time to time and shall be subject to such conditions and restrictions as may be prescribed, (the last of the requirements having been introduced by the Central Act 26 of 1969 after the judgment of the Supreme Court in the former decision referred to above). Sub -section (3) states that every licence issued before the coming into force of the Act under Part XII -A of the Defence of India Rules, 1962, or under the Gold (Control) Ordinance, 1968, would continue to be valid until the cancellation thereof under the Act. Sub -section (4) enables a person holding a licence at the commencement of the Act to continue to carry on the business and obtain a renewal of the licence. Sub -section (5) enables a person who intends to commence business after the commencement of the Act as a dealer to apply for a licence and obtain one. It is sub -section (6) of Section 27 which is important. Even at this stage, it is necessary to point out that sub -section (6) of Section 27 as it stood originally, was struck down as unconstitutional by the Supreme Court in the former decision referred to already, on the ground that it constituted an imposition of unreasonable restriction on the fundamental right of a citizen to carry on business. Having struck down Section 27 (6), the Supreme Court also pointed out that the licensing scheme contemplated by the rest of Section 27 of the Act itself could not be worked in practice and therefore observed -

(3.) AS I have pointed out already, the petitioners contend that this amended rule cannot apply to an application for renewal for the year 1973, because the amendment came into force only on 27 -12 -1972, while all the applications for renewal should have been made and were actually made on or before 30 -11 -1972, and to such applications this amendment ought not to have been given effect to. From one point of view, it is unnecessary to decide this question in the present writ petitions for the simple reason that the year 1973 is past, and during that period by virtue of the interim orders passed by this court the petitioners had been granted renewal of licences and they had been functioning as dealers and therefore it may not be really necessary to consider this question now, though I am inclined to agree with the contention of the petitioners. I may also indicate one other reason why this amended rule could not be given effect to in respect of licences for the year 1973. As I have pointed out already, all the applications for renewal should have been made and were actually made by the petitioners on or before 30 -11 -1972 and several other applications by other persons also, had been made on or before that date. In between 30 -11 -1972 and 27 -12 -1972 several applications for renewal had been ordered actually without reference to this amended rule and only because of the fortuitous circumstances or accident of the applications not having been disposed of before 27 -12 -1972, this amended rule came to be applied to those applications for renewal which remained undisposed of on 27 - 12 -1972. This will be a practical ground for holding that the amended Rule 3 (ee) should not have been given effect to, to the applications for renewal for the year 1973. As I have pointed out already, in view of the peculiar facts of these cases, namely, that the year 1973 is past and for that year the petitioners, by virtue of interim orders passed by this court, had been granted renewal of licences and they had been carrying on business, it may not be necessary to decide that question finally for the purpose of these writ petitions.