HIMACHAL FLOUR MILLS Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are the Wheat Roller Flour Mills licensees having licences under Clause 10 of the Wheat Roller Flour Mills (Licensing and Control) Order, 1957, issued under section 3 of the Essential Commodities Act, 1955 (referred to as the Act). During the year 1981 -82, petitioners could not mill the entire wheat purchased by them during that year and a substantial quantity of wheat and its products remained in their stock on 1 -8 1982, on which date the price of the wheat and its products were revised. The petitioners have been directed to pay the difference of price on their stock by memo dated 15 -10 -1982 (Annexure PH). Feeling aggrieved by the aforesaid memo, they have approached this court by filing the present writ petition under Article 226 of the Constitution challenging the legal validity thereof.

(2.) That the petitioners are licensed millers under the above mentioned Order and were supplied wheat by the Food Corporation of India at pre -revised rates, is not in dispute. It is also not in dispute that they could not mill the entire stock of wheat purchased by them and a substantial part of it remained in their stock on 1 -8 -1982, Not only the selling price of the wheat but also the selling price of its products was revised w.e.f. 1 -8 -1982 by a statutory order. It is also not in dispute that the respondent -Central Government is the licensing authority under the aforesaid Order. Since the wheat products are the articles of consumption of common man, the respondent -Government accepts its obligation to make the same available at a reasonable cost. It further appear that in order to ensure reasonable cost of wheat products, the respondent -Government provides a substantial subsidy to the Food Corporation of India so that the said Corporation does not suffer any financial loss in the deal. It is clear that in order to effectively achieve the aforesaid object and purpose, the respondent -Government had directed the Food Corporation of India to supply wheat to the petitioners at Rs. 155 per quintal, which had been done. It is also clear that the Government fixes a reasonable procurement price of wheat, each year so that the agriculturists producing wheat are able to get a reasonable price from their products. Admittedly, there is difference between the procurement price and the price at which the Food Corporation of India sells the wheat to the petitioners. Hence, it is obvious that but for the subsidy from the respondent -Central Government, supply of wheat to the petitioners and its products like Atta, Maida and Suji to common man at a reasonable price would not have been possible.

(3.) It is also not in dispute that the petitioners were not entitled, in law, to purchase the wheat from the open market. Their selling price was also controlled by a Price Control Order issued under the Act. It is obvious that the petitioners were not entitled to deal with the Food Corporation of India directly nor was the said Corporation entitled to treat the petitioners as its ordinary buyers in the market and sell wheat to them, Indeed, the petitioners were issued permits by the respondent -Government, which formed the basis for the Food Corporation of India to supply wheat to them. Since the selling price of wheat and also the selling price of its products are controlled by the respondent -Government by issuing orders under section 3 of the Act, the petitioners are assured only a reasonable profit in the process. Since the selling price of wheat was increased from Rs. 155 per quintal to Rs. 185 per quintal, w.e.f. 1 -8 -1982 and there was a corresponding increase permitted in the selling price of wheat products, the petitioners, having purchased the wheat at Rs. 155 per quintal, would make excess profit by selling its products at the revised rates. In order to avoid this undue profiteering by the petitioners, the respondents issued the impugned order and required them to pay the revised price on stock available with them. The legal validity of this order is under challenge in this writ petition.