Nanalal Dayaljibhai Thakkar vs State of Gujarat and Others

K.A. Puj, J.—Since, common issue is involved in both these petitions, they are heard together and are being disposed of by this common judgment and order.

The facts are taken from Special Civil Application No. 472 of 2009 for the sake of convenience.

The petitioners have filed these two petitions praying for quashing and setting aside the impugned order dated 31st December, 2008 at Annexure-F of the petition passed by the respondent No. 2 and the order dated 5th January, 2009 at Annexure-G to the petition passed by the respondent No. 3. The petitioners have also prayed for a direction to the respondent No. 2 to issue poison licence in favour of the petitioner w.e.f. 1st January, 2009 to 31st December, 2009.

This Court has issued notice on 21st January, 2009. On notice being served to the respondents an affidavit-in-reply is filed on behalf of the respondents on 9th February, 2009 and an affidavit-in-rejoinder is filed by the petitioner on 11th February, 2009.

Since, the pleadings between the parties are completed and looking to the urgency of the matter, both the petitions are taken up for final hearing.

The brief facts giving rise to the present petition are that a poison licence No. 4 of 80 under the provisions of the Poisons Act, 1919 was issued in the name of one Amrutlal Hardasbhai Mali and that was valid upto 31st December, 2004. The said Shri Amrutlal Hardasbhai Mali was holding a licence under the provisions of the Gujarat Poppy Capsules Rules, 1963 bearing Poppy-2 Licence No. 5 of 2002-2003 to sell poppy capsules. The said Amrutlal Hardasbhai Mali subsequently constituted partnership firm namely Pipaleshwar Trading Company w.e.f. 4th December, 2002. On constitution of the partnership firm, amougst the petitioner and the said Amrutlal Hardasbhai Mali licence was deemed to have been issued in the name of partnership firm. Thereafter, the said Shri Amrutlal Hardasbhai Mali retired from the partnership firm and the petitioner has become the sole proprietor of the said business of selling poppy capsules. After the retirement of the said Shri Amrutlal Hardasbhai Mali the Poppy-2 licence No. 5 of 2005-2006 was issued in the name of the petitioner which was sanctioned by the Deputy Commissioner, Prohibition & Excise, Gujarat State, Ahmedabad, vide order dated 25th March, 2004. The said licence was thereafter renewed from time to time and it was lastly renewed till 31st March, 2009.

The factum of constitution of partnership firm amongst the petitioner and the said Amrutlal Hardasbhai Mali, however, was not made known to the respondent No. 2 by inadvertence. The petitioner was however, allowed to do his business by selling poppy capsules to the respondent. The petitioner thereafter applied to renew the poison licence under the Act on 31st December, 2004. The respondent No. 2 however on 1st May, 2006 passed the order canceling the said licence. The petitioner challenged the said order before this Court in Special Civil Application No. 4322 of 2007, since, the said order was passed without affording an opportunity of hearing to the petitioner, this Court vide its order dated 22nd February, 2007 quashed and set aside the said order and directed the respondent No. 2 to hear the petition and decide the renewal application dated 30th December, 2004. Since, no decision was taken by respondent No. 2 and Mamlatdar, Radhanpur has to be sealed on the business premises of the petitioner on 3rd May, 2007 without issuing any notice, the petitioner approached the respondent Nos. 2 and 3, and thereafter, the seal was removed on 9th May, 2007. However, the directions were issued to the petitioner not to sell the poppy capsules till the petitioner received further instructions.

The petitioner, therefore, filed another application before this Court, being Special Civil Application No. 12868 of 2007. During the pendency of the said petition, the respondent No. 2 served upon the petitioner a show-cause notice dated 15th May, 2007 alleging that the petitioner continued the business of selling poppy capsules and during the checking of the shop/godown on 9th May, 2007, 1,000 kgs. unauthorised goods were found. The petitioner submitted the reply on 11th June, 2007 to the said notice. Since, the respondent No. 2 has not taken any step nor considered the said reply, the petitioner preferred the said Civil Application No. 16107 of 2007 for appropriate relief. Despite the notice having been served on the respondent No. 2, an order was passed by him on 27th June, 2007 directing the confiscation of the 1,000 kgs. poppy capsules and rejecting the application on 30th December, 2004 for renewal of poison licence. The petitioner, therefore, challenged the said order before this Court in Special Civil Application No. 16964 of 2007. While disposing of the said petition along with other petitions this Court directed the respondent No. 2 to decide the petitioners application within ten days with further direction that respondent No. 2 shall keep in view that the petitioners have been in this business for the last many years and their families are solely dependent upon the livelihood from his business. Pursuant to the said order the petitioner''s poison licence was renewed till 31st December, 2007. The petitioner thereafter applied before respondent No. 2 on 27th November, 2007 for renewal of the poison licence. The respondent No. 2 did not pass any order till 31st December, 2008, hence, the petitioner made an application on 31st December, 2008 to renew the poison licence till 31st December, 2009. Both these applications were rejected by the respondent No. 2 by common order dated 31st December, 2008 on the ground that the petitioner had stocked 500 to 600 kgs. poppy capsules. Based on this order the respondent No. 3 also served an order dated 5th January, 2009 directing the petitioner to stop the business pursuant to the directives issued by the respondent No. 2.

These two orders are under challenge in the present petition.

Mr. P. J. Kanabar learned Advocate appearing for the petitioner submits that the poppy capsules is an ''intoxicant'' within the meaning of Section 2(22) of the Bombay Prohibition Act, 1949. Under Sub-clause (2) of Section 4 of the Prohibition Act, 1949 the Collectors are considered to be subordinate to the Director. u/s 139(1)(b) and Section 143(1)(b) the State Government is authorised to make provisions by general or special order or by making rules to regulate the import, export, transport, possession, sale and purchase etc., of an intoxicant. In exercise of powers u/s 143 of the Act, the State Government has framed "Gujarat Poppy Capsules Rules, 1963" and under Rule 2(f) the ''Licensing Authority'' is defined. The licensing authority in the present case is respondent No. 3. Under Clause 4 of Rule 5 of the Rules, it is provided that the licensing authority will fix the quantity of poppy capsules to be stocked at a time of sale. Under Rule 5A of the Rules, the maximum limit for sale is prescribed to be 200 kg. per calendar month.

Based on the provisions of the Prohibition Act as well as Gujarat Poppy Capsule Rules, Mr. Kanabar has submitted that the petitioner has not committed any breach of the licence. He has further submitted that neither in the Poisons Act, nor in the Poisons rule no restriction about the quantity of sale and/or the stock is made. He has submitted that the impugned orders are required to be quashed and set aside.

The respondent No. 1 vide communication dated 14th August, 2008 appraised respondent No. 2 that the stock and sale limits are prescribed under the Rules and any deviation from these rules in Patan District is likely to create problem to the licence-holders. The respondent No. 2 being subordinate to respondent No. 1 ought to have accepted the advice and ought not to have passed the impugned orders. He has further submitted that the impugned orders are passed out of enmity and without any authority of law and in compete disregard of principles of natural justice. He has therefore submitted that the impugned order are liable to be quashed and set aside.

Mr. Kanabar has further submitted that the poppy capsules did not fall under the provisions of Poisons Act or under the Rules framed thereunder. The requirement poison licence is not a precondition to do the business of selling of the poppy capsules. The cancellation of licence and closing of the business of the petitioner by the respondent No. 3 is therefore not justified.

Mr. Kanabar has further submitted that the petitioner has been carrying on business of selling poppy capsules to the needy persons for medicine purposes for the last more than 7 years. There was no complaint to any of the respondents in connection with the licence business, and hence, there was no justification for the respondent No. 2 to pass the impugned orders.

Mr. Kanabar relies on the judgment of this Court Hathi @ Mangalsinh Ramdalyalji v. State of Gujarat reported in 1993 (2) GLH 673. Based on this judgment, he submitted that the impugned order is required to be quashed and set aside.

An affidavit-in-reply is filed on behalf of respondent No. 2. Ms. Trusha Patel learned Assistant Government Pleader appearing for respondent submitted that the poppy is the substance which is poison within the purview of the Poisons Act and is a prohibited substance under the Prohibition Act. Any person who wants to sell the said substance has to obtain licence under both the Acts and has to fulfill all the conditions enumerated in the licences issued under both the Acts. She further submitted that poppy is the substance included in the definition of poison. Rule 2 provides for definition of the poison which reads asunder "Poison, the substances specified in the Schedule to these rules shall be deemed to the poison for the purpose of these rules shall be deemed to the poison for the purpose of these Rules". The Schedule includes poppy and all preparations of poppy. Therefore, it is a poisons substance. She has further submitted that Section 2 of the Poisons Act, 1919 provides for the powers of State Government to regulate possession for sale and sale of any poison. In view of Section 2 the rules are framed and Rule 3 provides for prohibition of sale or possession of poison without licence which says that no person, unless exempted under the provisions of the Act shall sell or possess for sale any poison specified in Rule 2, except under licence granted in that behalf. In furtherance of the said rules, a form is prescribed which provides for the maximum quantity to be kept as stock and also the maximum quantity to be sold per month by the licence holder. In the case of the petitioner, at the time of issuing licence quantity of maximum permissible stock and sale/months is prescribed. The petitioner has never objected to the condition providing for maximum stock and sale. He has never challenged the said condition also. She has therefore, submitted that after committing the breach of conditions enumerated in the licence, the petitioner cannot challenge the validity of the conditions. The. petitioner himself cannot decide that such condition is not valid, and therefore, he is entitled to commit breach of such condition. She has submitted that in the licence itself by condition No. 7 it is provided that the District Magistrate shall have power to cancel the licence. Thus, the District Magistrate has rightly passed the impugned order, and hence, it does not call for any interference by this Court.

Ms. Trusha Patel has further submitted that the poppy is a poisonous substance which requires control for selling and possessing. The State Government has therefore, in the interest of public health prescribed the norms as per which the maximum quantity to be stocked the sale is to be regulated by prescribing the same in the licence. She has further submitted that reliance placed by the petitioner on the earlier order of this Court has no relevance at all as in the earlier, case the issue before this Court was that of issuance of licence and renewal of licence. The question of breach of conditions was not the issue at all. Even otherwise, pursuant to the order dated 10th July, 2007 passed by this Court, the licence was issued in favour of the petitioner which itself contains condition to maintain maximum stock and restriction on maximum sale. The petitioner has apparently breached the condition of licence, and hence, the impugned order passed by the District Magistrate is absolutely just and proper and no interference by this Court is required.

Having heard the learned Advocates appearing for the parties and having considered the rival submissions as well as the impugned order in light of the provisions contained in Bombay Prohibition Act, 1949 and Rules framed thereunder as well as the Poisons Act, 1919 and the Gujarat Poppy (Possession and Sales) Rules, 1963, the Court is of the view that when the licence is issued by the authorities in favour of the petitioner under both the statues namely Bombay Prohibition Act, 1949 as well as Poisons Act, 1919, the provisions contained in both the Acts are required to be complied with. Under the Poisons Act, 1919, Section 2 discusses about the power of the State Government to regulate possession for sale and sale of any poison. The State Government is empowered to frame rules for regulating the possession for sale, whether wholesale or retail, of specified poison. In Section 2(2), the State Government is also empowered to frame rules providing for the maximum quantity of any such poison which may be sold to any one person. Section 6 of the Act discusses about the penalty for unlawful importation etc. It stipulates that whoever commits a breach of any rule made u/s 2, or imports without a licence into India across of customs frontier defined, by the Central Government any poison the importation of which is for the time-being restricted u/s 3, or breaks any condition of a licence for the importation of any poison granted to him u/s 3, shall be punishable on a first conviction with imprisonment for a term which may extend to three months, or with fine which may extend to five hundred rupees, or with both and on a second or subsequent conviction with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.

The word "poison" is defined under the Rules, Rule 2 says that the substance specified in the Schedule to these rules shall be deemed to be a poison for the purpose of these Rules, Schedule inter alia includes poppy all preparations of except red poppy petals. Thus, there is no dispute about the fact that the Poppy-2 is poisonous substance within the meaning of Rules. Rule 3 stipulates that no person unless exempted under the provisions of the Act shall sell or possess for sale any poison specified in Rule 2, except under the licence granted in that behalf. It is not the case of the petitioner that he is exempted under the provisions of the Act. The licence under the poisons Act is issued in favour of the petitioner. Under the licence, the petitioner is permitted to keep stock of Poppy-2 upto 300 kgs. and the petitioner can sell Poppy-2 upto 200 kgs. The authorities have found that the petitioner has kept the stock more than 600 kgs. in each month despite the fact that the sale of Poppy-2 per month is less than 200 kgs. The authorities have further found that the petitioner has consistently committed breach of the licence issued in his favour. Despite this fact the petitioner was granted a new licence being licence No. 5 of 2007 on 21st July, 2007, and even thereafter, the breach was continued. The authorities were therefore, constrained to cancel the said licence. The argument of Mr. Kanabar is that the petitioner was permitted to sell Poppy-2 upto 200 kgs. He was permitted to keep the stock upto 600 kgs. by Superintendent of Prohibition vide licence dated 9th April, 2008 issued in his favour. In this licence, the petitioner was permitted to sell Poppy-2 upto 200 kgs. He was permitted to keep the stock upto 600 kgs. The petitioner has never committed breach of licence issued in his favour under the Prohibition Act. However, this argument is not weighed with the Court. When the petitioner is supposed to obtain the licence under the Poisons Act and such licence prescribed particular limit of selling as well as stocking poppy capsules such limit will have to be observed. There is no substance in the submission that in absence of any provision prescribing the limit for sale or for keeping the stock of Poppy-2 under the Poisons Act or the Rules framed thereunder, the respondent No. 3 is not empowered to impose such restrictions while issuing licence.

Even otherwise, Poisons Act is Central Act whereas the Prohibition Act is a local Act, and hence, Central Act prevails upon the local Act as per the mandate contained in Article 254 of the Constitution of India. While considering the submissions of the petitioner, the Court has to keep in mind the objects of the Poisons Act. The object of the Act is to consolidate and amend the law regulating importation, possession and sale of poisons. The authorities will have to see that the possession and sale of poison in a particular area should not exceed to a particular limit, and such limit is prescribed in the licence. The Court therefore does not accept the submissions of Mr. Kanabar that the licensing authority under the Poisons Act has no power to prescribe a particular limit of sale or possession of the poison. Looking to the object of the Act, the Court should not construe the provisions liberally. On the contrary, strict compliance of the provisions of the Act is required. It is also important to note that at the time when the licence was issued under the Poisons Act in favour of the petitioner prescribing the limit, no objection was raised by the petitioner. Once, having committed the breach, and thereafter, to raise an objection is not just and proper. The judgment relied upon by Mr. Kanabar reported in 1993 (2) GLH 673 (supra) is not applicable to the facts of the present case as in that case, the question involved was renewal of licence and it was decided only on the ground of non-discrimination. Here in the present case, the issue involved is cancellation of licence. Once, the petitioner has committed breach of the conditions laid down in the licence and the said breach is consistent, the authorities are justified in cancellation of the licence.

In view of the above facts and circumstances of the case and considering the statutory provisions, the Court does not find any substance or merits in any of these two petitions, and hence, they are summarily dismissed.

A copy of this order should be placed in each of these two petitions.