Ghasi Ram Agarwalla vs The State

Sen, J.—This revisional application is directed against the conviction of Ghasi Ram Agarwalla u/s 7(3) of the Essential Supplies Act and the sentence passed thereunder of a fine of Rs. 50, in default rigorous imprisonment for one month. There is also an order of forfeiture in respect of 54 tins of vegetable oil products weighing altogether 273 pounds.

The prosecution case briefly was as follows. Prosecution Witness 1, C. Rebello, a sub-inspector of police attached to the Enforcement Branch, went to the shop of Messrs. Khandu Ram Dwarka Prosad at 155/2 Bowbazar Street, Calcutta. On arrival at the shop he found animal ghee in 53 sealed tins weighing one maund 321/2 seers and along with the animal ghee he found 54 sealed tins of vegetable oil products amounting to 273 lbs. of various brands, such as "Dalda", "Kusum", "Rasoi", etc. The Petitioner was found in charge of the shop. Besides animal ghee and the vegetable oil products, the shop also contained pulses, flour, sugar, molasses, mustard oil, etc. The Petitioner was accordingly sent up in respect of the charge u/s 7(3) of the Essential Supplies (Temporary Powers) Act, 1946, for contravention of the provision of Clause (1) of S.R.O. 1090, dated December 23, 1950, passed under Clause 5(1) of the Vegetable Oil Products Control Order, 1947.

The accused pleaded not guilty and his defence was that he kept vegetable ghee and animal ghee separately in his shop and did not know that keeping them in the same shop was an offence. The only point urged in the lower court was that the Petitioner could not be considered a dealer in vegetable oil products as he was not an exclusive dealer in vegetable oil products but also dealt in other articles such as pulses, flour, molasses, mustard oil. etc. The learned Presidency Magistrate, however, came to the conclusion that the word "dealer" as used in the Vegetable Oil Products Control Order, 1947, did not mean an exclusive dealer in vegetable oil products and as the Petitioner dealt in vegetable oil products he was a "dealer" within the meaning of that order and was, therefore, guilty of contravention of the provisions of Clause (1) of S.R.O. 1090, dated December 23, 1950, for stocking animal ghee and vegetable oil products in the same premises. In view of the fact, however, that there was no allegation of adulteration for mixing animal ghee with vegetable oil products the learned Magistrate held that the offence was of a technical nature and he therefore did not impose a substantive sentence of imprisonment but imposed a sentence of fine only of Rs. 50, and he made the order of forfeiture of the vegetable oil products seized as stated already.

In this revisional application Mr. Ajit Kumar Dutt has urged several points. He has urged the point taken in the lower court, namely, that the Petitioner was not a dealer within the meaning of the Vegetable Oil Products Control Order, 1947. He has also urged a question of fact, namely, that there was no material on the record to show that the Petitioner actually was the shopkeeper of the shop at 155/2 Bowbazar Street, Calcutta, because according to the evidence of C. Bebello, sub-inspector of police, the Petitioner was merely found in charge of the shop. Apart from the evidence of P.W. 1, however, there was the evidence of P.W. 2, a neighbouring shop-keeper, who referred to the shop of 155/2 Bowbazar Street, Calcutta, as the shop of the accused and who stated that the accused was seen all along in the shop. Further the accused himself in his statement u/s 342 of the Code of Criminal Procedure stated that he kept vegetable oil products and animal ghee separately in his shop. Accordingly, it cannot be said that there was no material on the record to show that the Petitioner was himself the shop-keeper of the shop at 155/2 Bowbazar Street.

As regards the point whether a shop-keeper dealing with other articles of grocery along with vegetable oil products would be regarded as a dealer within the meaning of Vegetable Oil Products Control Order, 1947, we find no reason to differ from the conclusion of the learned Magistrate. In that order a "dealer" is defined as a person carrying on business in the purchase, sale or distribution of any vegetable oil product. The definition does not require that a person should be dealing exclusively in vegetable oil product. Accordingly, a person who is dealing in vegetable oil product along with other grocery is a dealer within the meaning of the Vegetable Oil Products Control Order, 1947.

Mr. Dutt also raised the point that the sub-inspector of Enforcement Branch was not authorised to enter upon and inspect the premises for ascertaining whether breach of Vegetable Oil Products Control Order, 1947, was being committed. On his attention being drawn to order No. 2-VP(2)/49, dated December 17, 1949, by which the Controller authorised any police officer not below the rank of a sub-inspector to exercise the powers of the Controller under Clause 8A of the Vegetable Oil Products Control Order, 1947, Md. Dutt gave up the objection that the sub-inspector had no authority to inspect and search the premises.

The main points of Mr. Dutt are that the notification S.R.O. 1090, dated December 23, 1950, issued by the Controller of Vegetable Oil Products is ultra vires the Essential Supplies-Act, 1946, and that the Controller was not entitled to issue such an order and also that such an order contravences Article 19 of the Constitution on freedom of trade. Clause (1) of the notification S.R.O. 1090 of December 23, 1950 runs as follows:

No dealer in any vegetable oil product shall stock or sell animal ghee in the premises where the vegetable oil product is stocked or sold.

This notification containing the above clause purports to have been issued under Clause 5(1) of the Vegetable Oil Product Control Order, 1947. Clause 5(1) of the Vegetable Oil Product Control Order 1947, runs as follows:

Every producer and every dealer shall comply with such directions regarding the sales, stocks and distribution of vegetable oil products as may from time to time be given to him by the Controller.

It would appear, therefore, that under Clause 5(1) of the Order the Controller had the power to issue notification giving directions to sellers of vegetable oil products that they must not stock or sell animal ghee and vegetable oil products in the same premises. Mr. Dutt, however, has urged that the power must be within the terms of Section 3 of the Essential Supplies Act, because the Vegetable Oil Products Control Order is itself an order passed in exercise of the powers conferred by Section 3 of the Essential Supplies (Temporary Powers) Act, 1946, and he has urged that anything which is not within the terms of Section 3 of the Essential Supplies Act must be regarded as ultra vires of the original Act, i.e., the Essential Supplies Act. Sub-section (1) of Section 3 of the Essential Supplies Act runs as follows:

The Central Government so far as it appears to it to be necessary or expedient for maintaining or increasing supplies of any essential commodity, or for securing their equitable distribution and availability at fair prices, may by order provide for regulating or prohibiting the production, supply and distribution thereof, and trade and commerce therein.

With reference to the terms above quoted, Mr. Dutt has urged that any order for regulating the distribution of essential commodity must be with the object of maintaining or increasing the supply of an essential commodity or for securing its equitable distribution and availability at fair prices and that an order prohibiting a dealer in vegetable oil product from stocking or selling animal ghee and vegetable oil product in the same premises would not be an order for maintaining or increasing the supply of the essential commodity in question, viz., vegetable oil products or for securing its equitable distribution or availability at fair prices.

But the term "maintaining the supply of an essential commodity may be deemed to include "maintaining the supply "''thereof in pure or imadulterated condition". Therefore it would be within the jurisdiction of the proper authority to make an order intended to secure that the essential commodity in question, viz., the vegetable oil products, should not be mixed with animal ghee or given in substitution for animal ghee. The provisions of Sub-section (1) of Section 3 are explained by Sub-section (2) of Section 3 which provides without prejudice to the generality of powers conferred by Sub-section (1), an order thereunder may provide for the specific objects mentioned in Sub-section (2). Among these we may refer to Clause (g) which runs as follows:

for regulating or prohibiting any class of commercial or financial transactions relating to foodstuffs or cotton textiles, which, in the opinion of the authority making the order are, or if unregulated are likely to be, detrimental, to public interest.

It would certainly be in the public interest to secure that vegetable-oil products should not be mixed up with animal ghee or that vegetable oil product should not be given in substitution for animal ghee. In this connection it is relevant to mention that there has been a great deal of agitation in the country against the sale of vegetable ghee and against the possibility of adulteration of animal ghee with vegetable ghee. In the circumstances any regulation which is intended to provide that vegetable ghee shall not be mixed up with animal ghee or shall not be given in substitution for animal ghee is a regulation for the sale of the vegetable oil product in the public interest, and, therefore, it is such an order as is contemplated by Clause (g) of Sub-section (2) and therefore, by Sub-section (1) of Section 3 of the Essential Supplies (Temporary Powers) Act, 1946. Mr. Dutt''s contention on this point, therefore, namely, that the notification S.R.O. 1090, dated December 23, 1950 is ultra vires the Essential Supplies Act, must be rejected.

His next contention is that the regulation is also ultra vires the Article 19 of the Constitution as it imposes unreasonable restriction on the freedom of trade. For reasons already explained we are not prepared to hold that the restriction which the regulation imposes is unreasonable. It must be held to be a reasonable restriction in the public interest and therefore there is no contravention of the provision of Article 19. Mr. Dutt has in this connection referred to the Supreme Court ruling in the case of Mohammad Yasin Vs. The Town Area Committee, Jalalabad and Another, . In that case, bye-law (1) of Jalalabad Town Area Committee provided that no person shall sell or purchase any vegetables or fruits within the prescribed limits of Town Area Committee, Jalalabad, by wholesale or auction, without paying the fee fixed under the bye-laws to the licensee appointed by the Town Magistrate. Bye-law 4(b) provided that any person could sell in wholesale at any place in the Town Area provided he paid the prescribed fees to the licensee. The bye-laws, therefore, in terms did not prohibit any body from dealing in vegetables and fruits, but they certainly had the effect of restriction on such sales, because the wholesale dealers who would have to pay the prescribed fee to the Contractor appointed by the Town Area Committee would necessarily have to charge the growers of vegetables and fruits something over and above the prescribed fee so as to keep a margin of profit for themselves, but in those circumstances no growers of fruits and vegetables would like to have his produce sold by the wholesale dealers but they would flock to the contractor appointed by the Town Area Committee who would only charge them the prescribed commission. If on the other hand, the wholesale dealers charged only, the commission prescribed by the bye-laws they would have to make over the whole of it to the contractor without keeping any profit for themselves. In other words, the wholesale dealers would be converted into mere tax-collectors for the contractor without any remuneration. In effect, therefore, the bye-laws imposed undue restrictions on the wholesale dealers of fruits and vegetables within the Town Area Committee.

The Supreme Court, however, did not dispose of the matter by saying that as there was an undue restriction imposed by the bye-laws on the wholesale dealers of fruits and vegetables the bye-laws were bad. They proceeded on the second contention raised before them, namely, that the Town Area Committee had no legal authority to impose a fee of one anna in the rupee on the value of the fruits and vegetables sold within the limits of Town Area Committee and that such imposition was in the nature of a sale tax rather than a license fee and that such an imposition could not be made validly under the bye-laws. The Supreme Court pointed out that the bye-laws purported to be made u/s 298(2) Clauses (j) and (d) of the United Provinces Town Areas Act 1914 and this section authorised the Town Area Committee only to make bye-laws fixing any charge or fees to be made u/s 293(1), while Section 293(1) authorised the Committee to charge fees to be fixed by the bye-laws or by public auction or by agreement for the use and occupation of any immovable property vested in the Town Area Committee. In other words, the Town Area Committee had the authority to impose such a fee only when the wholesale dealing in fruits and vegetables was held in any public market or other property vested in the Town Area Committee and they could not impose such a fee when the wholesale dealing was held in private premises belonging to the wholesaler. Therefore, the Supreme Court held that the bye-laws were ultra vires the United Provinces Town Areas Act, 1914, and could not, therefore, be enforced.

Accordingly, it would appear that the above ruling of the Supreme Court has no application to the present case. If we had held that the notification 1090 of December 23, 1950 was ultra vires the Essential Supplies Act, the Supreme Court ruling would have been applicable, and in any case we would have been bound to hold that since the notification was ultra vires the original Act the terms of the notification could not be enforced. Since, however, we have held that the terms of the notification in question are not ultra vires the Essential Supplies Act, the Supreme Court ruling in Mohammed Yasin v. Town Area Committee, Jalalabad, and Anr. (1) does not help the Petitioner. There is no reason whatever to hold that the restriction imposed by the terms of the notification in question amounts to an unreasonable restriction on trade. Accordingly this contention also must fail. Lastly, Mr. Dutt has urged that since the learned Magistrate himself found that the offence was of a technical nature, there being no allegation or mixing or adulteration against the accused, there should not have been an order of forfeiture of the entire stock of vegetable oil products found with the Petitioner. The relevant provision under which the Petitioner was convicted must be deemed to be Sub-section (2) of Section 7 because we are concerned with the case of an order relating to foodstuffs and not Sub-section (3) of Section 7 of the Essential Supplies Act. Sub-section (3) has only application to an essential commodity other than textiles and foodstuff. Sub-section (2) of Section 7 provides that the offence shall be punishable with imprisonment which may extend to a term of three years and also with fine, unless for reasons to be recorded in writing the Court is of the opinion that a sentence of fine only will meet the ends of justice. In the present case the learned Magistrate imposed a sentence of fine only after recording that it was a case of technical breach of orders u/s 3 of the Essential Supplies Act. As regards forfeiture Clause (b) of Sub-section (2) of Section 7 provides that any property in respect of which an order has been contravened or such part thereof as to the Court may seem fit and proper shall be forfeited, unless for reasons to be recorded in writing the Court is of the opinion that it is not necessary to direct forfeiture in respect of the whole or part of the property. Mr. Dutt has urged that just as the learned Magistrate exercised his discretion in favour of the accused in the matter of sentence, he ought to have exercised his discretion in favour of the accused in the matter of forfeiture. We do not, however, think that the circumstances justify a total exemption from the liability to forfeiture, but in the circumstances of the case we think that the forfeiture of half the quantity of the vegetable oil products seized would serve the ends of justice.

Accordingly, we modify the order of forfeiture and direct that 27 tins of vegetable oil products seized having a weight of approximately half the quantity of vegetable oil products seized be forfeited to the State and the balance along with the tins of animal ghee be returned to the Petitioner. The sentence of fine and the sentence of imprisonment in default is upheld.

With the above modification this Rule is discharged.