SHANKARLAL PURNIMAL Vs. COMMR OF CIVIL SUPPLIES HYDERABAD

JUDGEMENT

(1.) The petitioner is a business partnership. This Writ Petition is filed claiming payment of interest from the respondent State authorities under the Essential Commodities Act. The case of the petitioner is that it has sent a consignment of 320 bags of wheat by Railways to Kachiguda Railway Station and those goods were seized by the authorities under the Essential Commodities Act at Kachiguda for alleged contravention of the Essential Commodities Act and the Rules into which it is not necessary to go in this Writ Petition. All that we should notice is that after the goods were seized, the Collector held an inquiry into the alleged contravention under the Act and the Rules. The Collector held under S.6-A of the E.C. Act that there was no contravention of the Act or the Rules committed by the petitioner. Accordingly he passed no orders of confiscation of the goods earlier seized by the department. Thus the petitioner was entitled for the return of the goods. But while the proceedings were pending before the Collector, the authorities acting in pursuance of certain directions given by this Court, sold away those goods. As a result the goods were not available to be returned. The department has, therefore, paid only the sale proceedings of those goods. Now in this Writ Petition the petitioner says that he must be paid not only the sale proceeds of the goods but also interest at 6% on the price of the goods. This Writ Petition is filed for a declaration that the action of the respondent in refusing to pay interest is arbitrary and illegal and also for a direction to pay the petitioner interest at 6% on a sum of Rs. 67,000/- which represents the value of 320 quintals of goods sold.

(2.) This Writ Petition is opposed by the respondent Government wholly on the basis of law. The facts stated above are not in dispute. The Government's contention is that on the agreed facts of this case the petitioner would not be entitled to be paid under law any interest. According to it the petitioner would be entitled to be paid only the value of the goods seized and sold.

(3.) The petitioner who appeared as party in person did not refer to any provisions of the Act. He merely relied upon a judgement of a learned single Judge of this Court in W.P. Nos. 16514 of 1984, 326 of 1985 and 327 of 1985 wherein this Court has directed in similar circumstances payment of interest. But I am sorry to say that that judgement has not discussed the provisions of the Essential Commodities Act. It must be noted that the petitioner's case for payment of interest is based upon the statutory provisions of the Essential Commodities Act. This Court can merely direct the payment of interest if it finds the statute created such an obligation against the petitioner. The question therefore is to be examined on the point of the provision whether S.6-A of the E.C. Act deals with the confiscation proceedings to be conducted by the Collector. The Collector has power under that Section to decide whether a trader has committed any contravention of law with respect to those goods seized. If he finds any such contravention as having been committed by the trader he will confiscate the goods. On the other hand if he finds there is no contravention he would refuse to pass the order of confiscation. In the latter situation the trader would be entitled for the return of the goods. Section 6-A of the E.C. Act deals with that situation. Section 6-A also deals with the situation that may arise by reason of sale of goods. In that case S.6-A directs the authorities to return the sale proceeds to the trader after deducting reasonable expenses incurred in conducting the sale. Thus under S.6-A there is no provision for payment of any interest to the trader if the goods had been seized and later sold but was finally found no contravention of any provision of law. It is, therefore, clear that in the case of the petitioner which falls under S.6-A, there is no statutory obligation to pay any interest. The only obligation is to return the goods or sale proceeds.