Imbich Koya vs State of Kerala and Another

P. Govinda Menon, J.—The accused in C. C. 129 of 1960 on the file of the District Magistrate of Kozhikode has filed this revision petition. He was prosecuted u/s 16(1)(a)(ii) of the Prevention of Food Adulteration Act--Act XXXVII of 1954 for conducting a restaurant without a licence in contravention of Rule 4 of the Kerala Prevention of Food Adulteration Rules, 1957 (hereinafter referred to as the Kerala Rules). The learned Magistrate found the accused guilty and convicted him. On appeal to the Sessions Judge of Kozhikode the validity of Rule 4 was questioned and the learned Sessions Judge accepted the contention of the defence that Rule 4 was illegal and ultra vires as Section 24 of the Act under which the rule was made does not confer on the State Government power to make rules regulating the issue of licence for manufacture and sale of articles of food and that the power to do so is exclusively vested in the Central Government u/s 23 of the Act. The learned Sessions Judge, therefore, altered the conviction to one for contravention of Rule 50 of the Central Food Adulteration Rules (hereinafter referred to as the Central Rules).

The petitioner questions the validity and constitutionality of Rule 50(1) of the Central Rules and Rule 4 of the Kerala Rules and it is prayed that the rules may be declared unconstitutional, ultra vires and void. The attack against Rule 4 of the Kerala Rules is that the subject-matter of the said rule falls within clause (g) of Section 23(1) of the Prevention of Food Adulteration Act and that therefore it is beyond the competence of the state Government to frame any rules in regard to the same since Section 24 which confers on the State Government the power to frame rules expressly confines the scope of such power to matters not falling within the purview of Section 23.

The attack against rule 50(1) of the Central Rules is that the Central Government while enacting rules under the Act is functioning as a delegate of the Parliament and that therefore the Central Government cannot further delegate any part of their function to the State Government on the principle ''delegatus non potest delegare.'' In other words the contention is that by providing in Rule 50(1) that the provisions of Rule 50 will apply also to any other article of food which the State Government may by notification specify, the Central Government have in effect sub-delegated their legislative function which is not legally permissible. There is undoubtedly an element of delegation implied in the provision of Rule 50, for the Central Government in a sense authorises another body specified by it to do something which it might do itself. But such delegation, if it can be so called at all, does not in the circumstances appear to be unwarranted and unconstitutional.

In Baxter v. Ah Way ( (1909) 8 C. L. R. 626 at page 637) O''Connor J. of the High Court of Australia in a case which has a striking resemblance to this case stated :

The aim of all Legislatures is to project their minds as far as possible into the future, and to provide in terms as general as possible for all contingencies likely to arise in the application of the law. But it is not possible to provide specifically for all cases and therefore, legislation from the very earliest times, end particularly in modern times, has taken the form of conditional legislation, leaving it to some specified authority to determine the circumstances in which the law shall be applied, or to what its operation shall be extended, or the particular class of persons or goods to which it shall be applied.

A similar question arose in the case in The Edward Mills Co. Ltd., Beawar and Others Vs. The State of Ajmer and Another, . In that case the validity of Section 27 of the Minimum Wages Act giving power to the ''appropriate Government'' to add to either part of the schedule any employment in respect to which it is of opinion that minimum wages shall be fixed by issuing a notification was questioned. It was contended that no principle had been prescribed and no standard laid down which could furnish an intelligent guidance to the administrative authority in making the selection, that the matter was left entirely to the discretion of the ''appropriate Government'' to amend the schedule and that such delegation of power virtually amounts to a surrender by the Legislature of its essential legislative function and cannot be held valid. Relying on the Australian case in Baxten v. Ah Way ( (1909) 8 C. L. R. 626) and the Privy Council case in Reg v. Burah ( (1878) 3 A. C. 889) it was observed :

The Legislature undoubtedly intended to apply this Act not to all industries but to those industries only where by reason of unorganised labour or want of proper arrangements for effective regulation of wages or for other causes the wages of labourers in a particular industry were very low. It is with an eye to these facts that the list of trades has been drawn up in the schedule attached to the Act but the list is not an exhaustive one and it is the policy of the legislature not to lay down at one and for all time, to which industries the Act should be applied. Conditions of labour vary under different circumstances and from State to State and the expediency of including a particular trade or industry within the schedule depends upon a variety of facts which are by no means uniform and which can best be ascertained by the person who is placed in charge of the administration of a particular State.

It is to carry out effectively the purpose of this enactment that power has been given to the ''appropriate Government'' to decide, with reference to local conditions, whether it is desirable that minimum wages should be fixed in regard to a particular trade or industry which is not already included in the list. We do not think that in enacting section 27 the Legislature has in any way stripped itself of its essential powers or assigned to the administrative authority anything but an accessory or subordinate power which was deemed necessary to carry out the purpose and the policy of the Act.

This question again came up for consideration in Mohammad Hussain Gulam Mohammad and Another Vs. The State of Bombay and Another, where the constitutionality of Section 29 of the Bombay Agricultural Produce Markets Act, XXII of 1939 was challenged. It was argued that this gives a completely unregulated power to the State Government to include any crop within the schedule without any guidance or control whatsoever. The contention was negatived and their Lordships relied on the The Edward Mills Co. Ltd., Beawar and Others Vs. The State of Ajmer and Another, and stated:

The same considerations in our opinion apply to Section 29 of the Act and the power is given to the State Government to add to, or amend, or cancel any of the items of the agricultural produce specified in the schedule in accordance with the local conditions prevailing in different parts of the State in pursuance of the legislative policy which is apparent on the face of the Act. Therefore in enacting Section 29, the Legislature had not stripped itself of its essential powers or assigned to the administrative authority anything but an accessory or subordinate power which was deemed necessary to carry out the purpose and policy of the Act. We therefore reject the contention that Section 29 of the Act gives uncontrolled power to the State Government and is therefore unconstitutional.

We may also refer to another case decided by the Supreme Court in Civil Appeals Nos. 448 and 449 of 1957, The Bangalore Woollen, Cotton & Silk Mills Co., Ltd., Bangalore and The Mysore Spinning & Manufacturing Co., Bangalore v. The Corporation of the City of Bangalore by its Commissioner, Bangalore City (Not yet reported, but the blue print judgment is available). That was a case where the legality of the imposition of octroi on wool and cotton u/s 98 of the City of Bangalore Municipal Corporation Act (Act LXIX of 1949) was challenged. Section 97 of the Act enumerates the taxes and duties which the corporation is empowered to levy and it says that the corporation may levy an octroi on animals or goods or both brought within the octroi limits for consumption or use therein. Section 98 deals with the resolution to be passed by the Corporation imposing a tax or duty for the first time. It was argued that before a resolution u/s 98(1) could be passed the goods sought to be taxed had to be specified u/s 130 read with Schedule III, Part 7 of the Act. Clause 18 of that schedule provides that octroi on animals and goods shall be levied at the rates not exceeding the following. Clauses I to VII specify articles on which octroi could be levied Clause VIII was as follows :

Other articles which are not specified above and which may be approved by the Corporation by an order in this behalf.

This empowers the Corporation to impose octroi duty on other articles which are not specified but which may be approved by the Corporation and it was on the basis of this that the Corporation sought to levy the lax. The excessive nature of the delegation to the Corporation was questioned and his lordship Kapur J. dealing with the objection observed as follows:

The argument raised was that the power of the Municipal Corporation to specify goods under Clause VIII was excessive delegation which was both uncanalised and uncontrolled and reliance was place on a judgment of this Court in Hamdard Dawakhana and Another, Kalipada Deb and Another, Lakshman Shripati Itpure @ Lakshman Shripati Impore and A.B. Choudhri and Another Vs. The Union of India (UOI) and Others, but that case has no application to the facts of the present case. In the present case the Legislature has laid down the powers of the Municipality to tax various goods. It has enumerated certain articles and animals and clause VIII read with Section 97(e) of the Act has authorised the Municipality to impose tax on other articles and goods. This power is more in the nature of conditional delegation as was held in Baxter v. Ah Way ( (1909) 8 C. L. R. 626) where it was hold that u/s 52(g) of the (Australian) Customs Act, 1901, a power given to prohibit by proclamation the importation of certain articles was not a delegation of legislative power but conditional legislation because the prohibition of importation was a legislative act of Parliament itself and the effect of sub-section (g) of Section 52 was only to confer upon the Governor-General in council the discretion to determine to which class of goods other than those specified in the section and under what conditions the prohibition shall apply. All that the legislature has done in the present case is that it has specified certain articles on which octroi duty can be imposed and it has also given to the Municipal Corporation the discretion to determine on what other goods and under what conditions, the tax should be levied. That, in our opinion, is not a case which fails under the rule laid down by this Court in Hamdard Dawakhana v. Union of India (A. I. R. 1960 S. C. 551).

The Learned Counsel for the revision petitioner strongly relied on the case in Hamdard Dawakhana and Another, Kalipada Deb and Another, Lakshman Shripati Itpure @ Lakshman Shripati Impore and A.B. Choudhri and Another Vs. The Union of India (UOI) and Others, . But their Lordships on the facts of that case held that Parliament had established no criteria, no standard and had not prescribed any principle on which a particular disease or condition is to be specified in the schedule. It was not stated what facts or circumstances were to be taken into consideration in including a particular condition or disease and therefore the power of specifying diseases and conditions as given in Section 3(d) had gone beyond the permissible boundaries of valid delegation and their Lordships struck down the schedule in the rules. That case has therefore no application to the facts of the case before us.

The Central Government in this case have made all the necessary rules on the subject and thereby discharged fully their legislative function and what is left to the State Government under Rule 50(1) is only to determine to what further articles of food the operation of the said Rules should be extended. There is no element of legislative sub-delegation involved in this and therefore the argument that Rule 50(1) is ultra vires is devoid of any substance and must fail.

Now coming to the validity of Rule 4 of the Kerala Rules, Rule 4 has been framed in exercise of the powers conferred on the State Government by Section 24 of the Act which empowers the State Government to make rules for the purpose of giving effect to the provisions of the Act in matters not falling within the purview of Section 23. Sub-section (2)(b) of Section 24 says that such rule may prescribe the forms of licences for the manufacture, etc., of articles of food, the form of application for such licences, the conditions subject to which such licences, may be issued, the authority empowered to issue the same and the fees payable thereof. Therefore the primary provision prescribing and requiring a licence to be taken for the manufacture, sale, stocking or exhibiting for sale of any article of food is by Rule 50 of the Central Rules.

Rule 50 says:

No person shall manufacture, sell, stock, distribute or exhibit for sale any of the following articles of food except under a licence--

X X X X X

And sub-clause (1) gives power to the State Government to add to the list of articles of food, which they could by notification specify.

Rule 4 of the Kerala Rules provides that:

No person shall manufacture for sale any food without a valid licence issued under these rules.

This rule taken along with the succeeding rules 5 to 16 merely prescribes that in cases where a licence is necessary in law for the manufacture, sale, stocking, exhibition for sale or distribution of any particular article of food, the person concerned should obtain a valid licence issued under the rules. In other words what the Kerala Rules prescribe is the procedure for the grant of licence, the collection of fees in respect thereof, the conditions subject to which the licences are to be issued and the authority empowered to issue the same. All these are matters expressly enumerated in Section 24(2)(b) and are therefore fully within the rule making province of the State Government.

If rule 4 is interpreted in this manner and not as a rule requiring the taking of a licence for sale of any article of food as is mistakenly thought, there can be no doubt that the said rule is not in any way beyond the rule making competence of the State Government u/s 24 of the Act. Prosecution for failure to take out a licence can therefore be only for contravention of the provisions of Rule 50 of the Central Rules and not Rule 4 of the Kerala Rules.

We cannot accede to the contention of the learned Advocate-General that Rule 4 of the Kerala Rules can be taken as a notification contemplated under Rule 50(1) of the Central Rules adding to the list of articles of food enumerated therein. What is argued is that when power is given to add to the list of articles of food nothing prevents the State Government in laying down that manufacture and sale of all articles of food require licence to be taken. This contention overlooks that even in Rule 50 the State Government is given power only to include particular kinds of food. A list of articles of food requiring licence is mentioned in Rule 50 and what is contemplated is that the State Government may add to that list by including other specified articles of food. We do not think that a general inclusion of all articles of food is permissible under the powers vested in the State Government under Rule 50(1).

So also Schedule I appended to the Rules cannot also be taken as a notification issued by the State Government under Rule 50. That schedule only gives the scale of licence fee to be levied. Rule 6(a) of the Kerala Rules says :

The licence fee shall be as set forth in Schedule I.

The purpose of the schedule is therefore entirely different and we cannot accept the argument that that schedule satisfies the requirements of Rule 50(1) of the Central Rules. If the State Government wants that any addition should be made to the list of articles of food enumerated in Rules 50 a notification has to be issued adding particular kinds of food they think necessary to the list given in Rule 50 and the licence fee would be as mentioned in the schedule.

The Learned Counsel for the municipality has attempted to impress upon us the serious consequences of the view that we are taking. It was represented that this petitioner as well as others like him had applied for licence to run restaurants. For adequate reasons licence was refused and still they continued to run the business vending articles of food and it would be a sorry state of affairs if they are to be found not guilty of any offence and acquitted. That may be so but it is no concern of a court of law. Courts are more anxious and should be more anxious, to protect the liberty of the subject rather than consider the question of policy. We see no difficulty in the way of the State Government if they desire that persons should not stock or sell any particular kind of food not mentioned in Rule 50 of the Central Rules in any restaurant to issue the necessary notifications as contemplated in Rule 50(1) and prove in court that they were dealing in such food stuffs without a licence. In this case even though the specific charge which the accused was called upon to answer was for failure to take out a licence under Rule 4 of the Kerala Rules, the learned Judge has convicted the accused for contravention of Rule 50 of the Central Rules. To sustain a conviction under Rule 50 the prosecution ought to have adduced evidence that the accused was found manufacturing, selling, stocking, distributing or exhibiting for sale in his restaurant any of the articles of food mentioned in Rule 50. No such evidence was led and the only evidence that was adduced was that the accused was running a restaurant without a licence probably because schedule I of the Kerala Rules has fixed a licence fee of Rs. 15/- for running a restaurant. Running a restaurant by itself would not amount to a contravention of Rule 50 of the Central Rules unless there is further proof that the accused was dealing in any of the articles of food which require licence to be taken. There is no such evidence and the accused cannot be found guilty of the offence of contravening the provisions of Rule 50 of the Central Rules. It would be open to the municipality to prosecute the accused again if he is found running the restaurant without taking out a licence provided it is proved that he is dealing in articles of food mentioned in Rule 50 of the Central Rules or dealing in articles of food which the State Government may by notification specify. The conviction of the accused in this case is not justified and cannot be sustained. We, therefore, allow the revision petition, set aside the conviction and sentence, and direct the accused to be acquitted. His bail bond will stand cancelled.