MOOLCHAND AND CO Vs. STATE OF ASSAM

JUDGEMENT

(1.) In this application under Article 226 of the Constitution, the petitioners have prayed for quashing the orders dated 15.11.88 and 8.5.90 issued by the Secretary of the Guwahati Tea Auction Committee cancelling the registrations of the two petitioners as registered buyers.

(2.) The tacts briefly are that the petitioner No. 1, Mool Chand & Company, is a partnership firm, and the petitioner No. 2, M/s. G.R. Trading Company, is a proprietorship concern. Sri Pawan Kumar Anand is the Managing Partner of petitioner No.1 - firm and the Proprietor of the petitioner No.2 concern. The two petitioners, inter alia, were carrying on the business of buying and selling tea. The petitioner No. 1 was registered as a buyer with the Guwahati Tea Auction Committee on 9.8.82 and the petitioner No. 2 was registered with the said Guwahati Tea Auction Committee as a buyer on 26.11.87. Since their registration as buyers with the Guwahati Tea Auction Committee, the two petitioners had been purchasing tea in public auctions organised by the Guwahati Tea Auction Committee from time to time. The public auctions are organised by the Guwahati Tea Auction Committee in accordance with the Gauhati Tea Auction Rules, 1970. Part-III of the said Gauhati Tea Auction Rules, 1970, contained the conditions of sale by auction and Rule I3(b) of the said Part-in of the Gauhati Tea Auction Rules, 1970 provided that should a buyer fail to meet a prompt payment the Broker who sold the tea will notify the Guwahati Tea Auction Committee who shall have the power to remove the Buyers name from the list of registered buyer. By letter dated November 11,1988, a registered broker, J. Thomas & Co. Private Limited, informed the Secretary of the Guwahati Tea Auction Committee that a cheque for an amount of Rs. 1,42,682,22 issued by the petitioner No. 1 firm in favour of the said broker had not been credited to the account of the broker and the cheque amount was not available in the account of the petitioner No. 1 firm and hence it would be prudent on the part of the Guwahati Tea Auction Committee to deregister the petitioner No.1 firm and the petitioner No, 2 concern of which Sri Pawan Kumar Anand was the Partner and the Proprietor respectively. On the basis of the said complaint made by the broker M/s. J. Thomas & Co. Private Limited, the registrations of the two petitioners with the Guwahati Tea Auction Committee were cancelled by order dated 15.11.88 issued by the Secretary, Guwahati Tea Auction Committee. Aggrieved, the petitioner No.1 firm challenged the said order in this Court in Civil Rule No. 1648/89 and by order dated 1.11,89 this Court suspended the said order dated 15.11.88 of the Secretary, Guwahati Tea Auction Committee. Thereafter on 9.1.90 on a submission being made by Mr. Padma Prasad, learned counsel appearing for the Guwahati Tea Auction Committee that the said order dated 15.11,88 of the Secretary, Guwahati Tea Auction Committee, would be withdrawn and if necessary fresh action in accordance with the Rules would be taken and reasonable opportunity to the petitioner would be given before taking any final action in the matter, this Court closed the writ petition on withdrawal with a direction that until the said order dated 15.11.88 was withdrawn, the interim order dated 1.11.89 would continue. Thereafter, show -cause notices dated 15,2.90 were issued by the Guwahati Tea Auction Committee (hereinafter called "the GTAC") to both the petitioners to show cause as to why their names should not be struck off from the list of the registered buyers ofthe GTAC. The petitioners No. 1 and 2 submitted their show cause replies in their letters dated 6.3.90 and 7.3.90 respectively to the GTAC. After the said show cause replies, a meeting of the GTAC was held on 21.4.90 to which Sri P.K.Anand, Managing Partner of petitioner No. 1 and the Proprietor of petitioner No.2 was afforded the opportunity to make his submission personally as requested by him in his show cause replies. At the said meeting, the GTAC decided to deregister me two petitioners. Pursuant to the said decision of the GTAC, the impugned orders dated 8.5.90 were issued by the Secretary of the GTAC informing the petitioners that their registration as buyers with the GTAC stood cancelled with immediate effect, The petitioners have filed this writ petition challenging the said orders of the GTAC cancelling their registration as buyers.

(3.) A preliminary objection was raised by Sri Padma Prasad, learned senior counsel appearing for the respondents as to the maintainability of the writ petition. Relying on the averments in paragraph 9 of the affidavit-in-opposition filed on behalf of the respondent No.2, Mr, Prasad submitted that the GTAC is a society registered under the Societies Registration Act, 1850, and is not financed by the State Government He referred to the proceedings of the GTAC dated 21.4.90 to show that amongst the members of the GTAC, the Chairman of the GTAC and the Commissioner of Taxes were the Government officials and other members of the GTAC were not Government officials but were representatives of various buyers, sellers, brokers, etc. No control therefore is exercised by the Government over the GTAC. He cited a judgment of the Full Bench of this Court in the case of Sahabuddin Choudhury-Vs-State of Assam & Others, 1993 (2) GLJ 51, in which the Full Bench after noting several decisions of the Supreme Court held that in order to decide whether a particular organisation is an "other authority" within the meaning of Article 12 of the Constitution, the Court must have regard to various factors, such as, functional character being Governmental in essence, plenary control residing in Government or its officers, financial resource and of the State being the chief funding source, prior history of the same activity having been carried on by Government and made over to the new body, the composition of the body being dominated by the Government representatives, the presence or absence of deep and pervasive control by the Government over the organisation. But in the GTAC none of the aforesaid features of "other authority "as pointed out by the Full Bench of this Court in the case of Sahabuddin Choudhury (supra) is present. He further argued relying on the judgments of the Supreme Court in the cases of Sabhajit Tewary-Vs-Union of India & Others, AIR 1975 SC 1329, and Sukhdev Singh and Others-Vs-Bhagatram Sardar Singh Raghuvanshi & another, AIR 1975 SC 1331, that the GTAC is not a statutory authority and is only a licencee under the Tea (Marketing) Control Order, 1984, for the purpose of carrying out public auctions of tea. According to Mr. Prasad, since the GTAC is neither a statutory authority nor an authority over which the Government has any control, it is not an "other authority" within the meaning of Article 12 of the Constitution and, therefore, not an instrumentality of the State, and the writ petition against the GTAC is not maintainable.