LOHA COMMITTEE Vs. UNION OFINDIA

JUDGEMENT

(1.) THE Petitioner No. 1 is a registered Society of dealers in iron and steel products of which the petitioners Nos. 2 to 43 are members. In the original writ petition their complaint was that the quota of iron and steel of the scarce variety allot ted to the State of U. P. was passed on in its entirety to the Small Industries Corpora tion Limited, Kanpur and nothing out of this quota was given to the dealers in iron and steel. They, therefore, prayed that a writ of mandamus be issued to the State Government not to give the entire quota to the Small Industries Corporation Limited, but to distribute the same amongst all the dealers. By an amendment application, which was allowed the petitioners have prayed for the quashing of a resolution of the Ministry of Steel and Heavy Engineering published in the Gazette of India Extraordi nary dated May 22, 1970, which, inter alia, lays down the procedure for indenting iron and steel by the dealers from the manufac turers.

(2.) THE Iron and Steel (Control) Order, 1956, was made by the Central Gov ernment in exercise of its power under Sec tion 3 of the Essential Commodities Act, 1955. Clause 4 of this Order regulated the acquisition of iron and steel from a producer or stockholder etc. Clause 5 regulated the disposal of iron and steel. Clause 15 con ferred upon the Controller the power to fix maximum prices of iron and steel. Clauses 18, 20 and 27 regulated the acquisition, dispo sal and fixing of prices of scrap. Clause 13 conferred on the Controller the power to-control production of iron and steel. Clause 17 conferred power on the Central Govern ment to give directions as to the procedures to be followed by the authorities issuing quota certificates, permits etc.

(3.) THE second relief, which the peti tioners have sought, is based on a notifica tion of the Central Government dated April 29, 1969, published in the Gazette of India Extraordinary dated May 1, 1969. This notification was issued under clause 2-A of the Order. By this notification the Central Government exempted all the categories of iron and steel specified in the Schedule to fee Order from- the operation of the provi sions contained in Clauses 4, 5, 15, 18, 20 and 27 of the Order. The effect of this noti fication was that virtually all control was lifted from all varieties of iron and steel so far as acquisition, disposal and fixation of prices thereof were concerned. This con trol having been lifted, it was open to dea lers to place orders for all varieties of iron and steel with the producers directly. In the Gazette of India Extraordinary dated May 22, 1970, a resolution of the Ministry of Steel and Heavy Engineering dated May 22, 1970 was published. Under this resolution a Steel Priority Committee and a Joint Plant Committee were set up. Paragraph 7 of this resolution lays down the procedure regulating the indenting of iron and steel. Under this paragraph all inden tors are required to book orders for iron and steel through the Joint Plant Committee. The indents are required to be accompanied by such documents as may be prescribed by the Joint Plant Committee. After receiving the indents, the Joint Plant Committee is required to scrutinise them and to forward them to the producers for booking orders. The Joint Plant Committee is authorised to prescribe the financial and other formalities to be completed by the indentors before the manufacturers accept the indents. I am informed that the Joint Plant Committee has laid down that each indent is to be accompanied by a bank draft for 25 per cent of the value of the indent. The sale orders will be valid for a period of two in years only from the date of booldng and will automatically lapse at the end of that I period. On the lapse of the order, the I deposit is to be returned to the indentors ' without any interest. It will thus be seen that this resolution seeks to regulate the ac quisition and distribution of iron and steel. In the heading of the notification itself it is set out-.