V. MANESHAM Vs. THE STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) The petitioner is a dealer doing business in food grains and sugar holding licences granted under the Andhra Pradesh Food-grains Dealers' Licensing Order, 1964 and the Andhra Pradesh Sugar Dealers' Licensing Order, 1963, in respect of fair price shop No. 409 in Hyderabad which was allotted to him out of fair price shops created in the scheme of public distribution system for securing equitable distribution and availability at fair prices of essential commodities to the general public. According to the scheme, the petitioner was being allotted by the Government for his shop certain quantities of rice, wheat, sugar and other commodities to sell the same in rationed quantities to the persons holding cards and allotted to that shop. The Collector, Hyderabad District, the second respondent herein, on the basis of a report of the Inspector of Police, Vigilance cell, Civil supplies, the fourth respondent herein, passed an order dated 9-10-1972, temporarily suspending the licences issued to the petitioner under two licensing orders in respect of fair price shop No. 409 and stopping further issue of quantities of essential commodities to him pending enquiry and final orders, on the ground that when the fourth respondent visited the shop on 4-10-1972 some irregularities were found and the petitioner issued lesser quantities to the cardholders and entered more quantities in the sales register and has not maintained the accounts and registers correctly and properly contravening the conditions of the licences. The Second respondent has also ordered the transfer of the cards of shop No. 409 to shop No.410 along with the stocks of Essential Commodities. It is to quash this order the writ petition has been filed.

(2.) The Essential Commodities Act, 1955 was enacted to provide, in the interests of the general public, for the control of the production, supply and distribution of and trade and commerce in, certain commodities which are considered to be essential to the general public. The commodities which are considered essential are enumerated in section 2(a) of the Essential Commodities Act. The dominant object and intendment of the Act is to secure equitable distribution and availability at fair prices of essential commodities to the general public. With this object in view various control orders are passed from time to time as provided under section 3 of the Essential Commodities Act regulating the production or manufacture of any essential commodity; controlling the price at which any essential commodity may be bought or sold: regulating the storage, transport, distribution, disposal, acquisition, use or consumption of any essential commodity; prohibiting the withholding from sale of any essential commodity ordinarily kept for sale, requiring any person holding in stock any essential commodity to sell the whole or a specified part of the stock in such manner as may be specified; by requiring the persons engaged in the production, supply or distribution of trade and commerce in, any essential commodity to maintain and produce for inspection such books, accounts and records relating to their business and to furnish such information relating there to, as may be specified in the order. These regulations in trade and commerce are made generally by means of requiring persons engaged in the same to obtain licences and licences are issued in the prescribed forms imposing conditions. The Andhra Pradesh Food-grains Dealers Licensing Order, 1964 and the Andhra Pradesh Sugar Dealers' Licensing Order, 1963 are the orders made by the Government of Andhra Pradesh in exercise of the powers conferred on it by Sec 3 of the Essential Commodities Act to regulate the business in food-grains and sugar. It is provided under Clause 3 of the Andhra Pradesh Food-grains Dealers' Licensing Order that no person shall carry on business as a dealer except under and in accordance with the terms and conditions of the licence issued in that behalf by the licensing authority. Provision is made in clause 4 for issue of a licence or its renewal in form B. According to the conditions of the licence as per Form B the food-grains will be stored at the places indicated there and the licensee shall take adequate measures to ensure that food-grains stored by him are maintained in proper condition. The licensee shall maintain a register of daily accounts for each of the food-grains showing the opening stocks on each day; the quantities received on each day showing the place from where and the source from which received; the quantities delivered or otherwise removed on each day showing the places of destination and the closing stock on each day. It is also provided that the licensee shall complete his accounts on the same day to which they relate. The licensee is also prohibited from withholding from sale the supplies of food-grains ordinarily kept for sale. There are similar other conditions in the licence. The Andhra Pradesh Sugar Dealers Licensing Order was made to regulate the business in purchase, sale or storage of sugar. Under clause 3 it is provided that no person shall carry on business in sugar except under and in accordance with the terms and conditions of the licence issued in that behalf by the licensing authority. A similar form is prescribed for the issue of the licence imposing similar conditions as mentioned above with regard to Andhra Pradesh Food-grains Dealers' Licensing Order. In both the orders provision is made giving power to the licensing authority to refuse to grant or renew a licence, by giving reasons, after giving the dealer concerned an opportunity of stating his case. Provision is also made for cancellation or suspension of the licences for contravention of any of the conditions thereof. It is provided under Clause 8 of the Food-grains Dealers Licensing Order and Clause 7 of the Sugar Dealers' Licensing Order that no licence holder or his agent or servant or any other person acting on his behalf shall contravene any of the terms and conditions of the licence and if there is any contravention his licence may be cancelled or suspended by order in writing of the licensing authority after giving a reasonable opportunity of stating his case against the proposed cancellation or suspension.

(3.) As provided under Article 19(1)(g) of the Constitution of India all citizens have a fundamental right to practise any profession, or to carry on any occupation, trade or business. But this fundamental right is subject to-some limitations contained in the Article itself. That right is subject to the right of the State to make any law imposing reasonable restrictions on it in the interests of the general public. It is to protect the interests of the general public i.e. to secure to the public equitable distribution and availability at fair prices of essential commodities, the Essential Commodities Act, 1955, was enacted and Control Orders as provided thereunder are made. The validity of the Control Orders in question is not questioned in this writ petition. What is contended by Mr. P.A. Choudary, learned counsel for the petitioner, is that as provided under clause 8 of the Food-grains Dealers' Licensing Order and clause 7 of the Sugar Dealers Licensing Order, the licences can be suspended only after giving a reasonable opportunity to the petitioner for stating his case against the proposed suspension and the order passed by the second respondent without giving the petitioner any opportunity is illegal. What is provided in the above clauses is only passing of final orders cancelling or suspending the licences as a punishment after due enquiry for the contravention of the conditions of the licenses after giving an opportunity to the licences to be heard on the proposed action to be taken. In the present case, the second respondent has not passed any final orders of suspension. What was passed is only temporary suspension pending enquiry into the matter. Even so, Sri Choudary has argued that it is against the principles of natural justice for the second respondent to have passed that order even temporarily suspending the licences pending enquiry without giving an opportunity to the petitioner of stating his case against the proposed interim suspension. In this connection, Sri Choudary has placed reliance on some decisions which will be referred to now. In the decision Anumathi Sadhukhan v. A.K. Chaterjee, (AIR 1951 Calcutta 90) the Calcutta High Court was dealing with clauses 9 and 13 of the West Bengal Rice Mills Control Order empowering cancellation or refusal to renew a licence already issued without assigning any reasons. The Calcutta High Court held that the power oversteps the limits of reasonableness and therefore, cannot be said to be a reasonable restriction on the fundamental right conferred by Article 19(1)(g) of the Constitution because the provisions do not give any opportunity to the licence holders to make any representation against the action taken by the authorities concerned or to protect their interests against any wrongful action of the authorities and they further provide scope for the exercise of the power conferred on the authorities in an arbitrary or capricious manner if they so choose to do it.