Satyanarayan Agarwalla vs State

A.N. Banerjee, J.—On October 23, 1975, the Police searched the premises of the Petitioner in Cr. Rev. No. 880 of 1976 and seized the entire quantity of 226 bags of sugar found in his premises. The said Petitioner carries on business in sugar under the name and style of Sree Mahabir Trading Company at 51/4 Strand Road. On November 6, 1975, the said Petitioner applied for the custody of the seized property before the learned Additional Chief Metropolitan Magistrate, Calcutta. He filed another application in continuation of the previous one on December 22, 1975. The said Petitioner wanted to make out a case that on December 22, 1975, the opening balance of sugar of the Petitioner was 75 quintals and that during the day''s transaction he purchased sugar not exceeding 100 quintals and sold 96 quintals of sugar leaving a balance of 79 quintals of sugar on October 23, 1975. It was his case that on October 21, 1975, he had sold 74 quintals of sugar to Messrs. Satyanarayan Agarwalla of 67/48 Strand Road, Calcutta, for a sum of Rs. 31,000 out of which an advance of Rs. 1,000 was paid by account payee cheque and 95 quintals to other customers. It was alleged that the Petitioner had sold 50 quintals to Messrs. Ramkrishna Pal of Raghunathgunj, Murshidabad, 6 bags to Messrs. Vijay Stores, Durgapur and 23 bags to other parties making a total of 79 quintals before the closing of the day on October 23, 1975. Satyanarayan Agarwalla, who is the Petitioner in the other revisional application being Cr.Rev. No. 879 of 1976, also filed an application before the learned Magistrate for return of the aforesaid quantity of sugar which he claimed to have purchased from Sree Mahabir Trading Company for Rs. 31,000 and to have paid Rs. 1,000 in advance by an account payee cheque. The learned Magistrate rejected the prayer of both Prahlad Rai Shah and Satyanarayan Agarwalla and directed the Investigating Officer to make reference to the Collector u/s 6A of the Essential Commodities Act. As against such order of the learned Magistrate both Prahlad Rai Shah of Sree Mahabir Trading Company and Satyanarayan Agarwalla moved in revision the learned Judge of the City Sessions Court. The learned Judge by his impugned order rejected the two applications filed by the said two Petitioners but directed that the Police should release 50 and 6 bags of sugar respectively out of the seized quantity of 226 bags to Ramkrishna Pal and Om Prokash on proper bond to the satisfaction of the learned Magistrate. Ramkrishna Pal and Om Prokash also filed two similar revisional applications against the order of the learned Magistrate before the Sessions Court. The learned Judge directed, further, that the Police would take immediate steps for sale of the remaining bags of sugar, namely 74 bags plus 96 bags totalling 170 bags in the open market through the Director of Rationing after due notice to the Petitioners and to credit the sale proceeds in favour of the Court below pending investigation or trial, if any. It is as against such order of the learned Judge that the present two applications were filed before this Court and the present Rules were issued.

Mr. Monoj Mukherjee, learned Advocate appearing for the Petitioner in Cr. Rev. No. 880 of 1976, submitted that the learned Judge went wrong in passing the impugned order inasmuch as the Petitioner had committed no offence by storing 226 bags of sugar which were seized by the Police. In this connection, he drew my attention to the Sugar (Control) Order, 1966, made by the Central Government in exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955 (X of 1955). Paragraph 17 of the said order lays down that the Sugar (Control) Order, 1966 and any order made by the Central Government or a State Government or any authority regulating or prohibiting the production, supply and distribution of sugar and trade or commerce therein are hereby repealed except as respects things done or omitted to be done under any such order before commencement of this order. Clause (2) of para. 17 lays down further that notwithstanding such repeal an order made by any authority, which is in force immediately before the commencement of this order and which is consistent with this order, shall continue in force and all appointments made, prices fixed, licences and permits granted and directions issued under any such order and in force immediately before such commencement shall likewise continue in force and be deemed to be made, fixed, granted or issued in pursuance of this order.

In view of the aforesaid provisions of para. 17 of the Sugar (Control) Order, 1966, Mr. Mukherjee submitted that the West Bengal Sugar Dealers Licensing Order, 1963, stood repealed and that, as such, the 226 bags of sugar which were seized by Police in violation of para. 3 of the aforesaid order of the State Government could not be said to have been made in violation of any such order. In the West Bengal Sugar Dealers Licensing Order, 1963, ''dealer'' was defined in para. 2(a) as follows:

''dealer'' means a person engaged in the business of purchase, sale or storage for sale of sugar in quantities exceeding (100 quintals) at any one time, but does not include an industrial undertaking which is engaged in the manufacture or production of sugar and which is registered or licensed under the Industries (Development and Regulation) Act, 1951.

Under para. 3 of the aforesaid order no person shall carry on business as dealer except under and in accordance with the terms and conditions of a licence issued in this behalf by the Licensing Authority. The aforesaid provisions of the West Bengal Sugar Dealers Licensing Order, 1963, make it clear that a person carrying on business in sugar as a dealer requires licence under the aforesaid order if his business in sugar is in quantity exceeding 100 quintals at any one time. Now, under the Sugar (Control) Order, 1966, as made by the Central Government there is no such restriction regarding business in sugar. On the other hand, the said Order has imposed certain restrictions of sale of sugar on producers and has also made provisions regarding power to issue directions by the Central Government or the Chief Director to any producer or recognised dealer or any class of producers or recognised dealers regarding production, maintenance of stocks, storage, sale etc. in respect of sugar. This being the position, Mr. Mukherjee contended that the learned Judge of the City Sessions Court went wrong in refusing the prayer of the Petitioner for return of the seized stock of sugar.

Mr. Bimal Kumar Chatterjee, learned Advocate appearing for the Petitioner in the other case, supported the arguments of Mr. Mukherjee. Mr. Chatterjee submitted, further, that no decision could be drawn against Satyanarayan Agarwalla because of the non-cashing of the account payee cheque which was issued in favour of the Petitioner in the other case prior to the date of the seizure of the stock of sugar by the Police.

Mr. S.S. Pal, learned Advocate appearing for the State, controverted the arguments of both Mr. Mukherjee and Mr. Chatterjee and contended that in view of Clause (2) of para. 17 of the Sugar (Control) Order, 1966, as made by the Central Government, it could not be contended that the West Bengal Sugar Dealers Licensing Order, 1963, stood repealed in its entirety. Mr. Pal'' submitted, further, that apart from Police investigation, which was now pending, the Essential Commodities Act had made a special provision regarding forfeiture of the goods seized for the contravention of an order made u/s 3 of the said Act and that, as such, the learned Sessions Judge was wrong in passing the impugned order regarding return of a portion of the seized sugar bags to two persons and sale of the remaining portion in the manner as contained in the impugned order.

Taking up the last contention of Mr. Pal, I may at once point out that it is not open to Mr. Pal to challenge the impugned order of the learned Sessions Judge without coming up against such order before this Court. I am also of the view that Section 6A of the Essential Commodities Act, 1955, does not debar the learned Magistrate from passing necessary orders with regard to the seized goods u/s 457 of the Code of Criminal Procedure, 1973. This would be apparent from the mode of penalties as stated in Section 7 of the aforesaid Act. It was, therefore, within the competence of the learned Sessions Judge to pass necessary orders regarding the custody and/or disposal of the seized goods.

This brings us to the question whether the Petitioners of the two cases are entitled to the return of the seized sugar on the ground that they had not contravened any provisions of law, although the matter is under Police investigation. In my view, a reading of the provisions of para. 17 of Sugar (Control) Order, 1966, as made by the Central Government, makes it clear that all other orders made by the Central Government or a State Government or any authority regulating or prohibiting production, Supply and distribution of sugar and trade or commerce therein stood repealed except as regards things done or omitted to be done under any such order before the commencement of this order. Clause (2) of para. 17 is to be noticed relates to an order made by any authority and not by the Central Government or a State Government which is in force immediately before the commencement of this order and which is also not inconsistent with this order. Such order as made by any authority shall continue in force and be deemed to have been made, fixed, granted or issued in pursuance of this order. It cannot be said that para. 3 or the definition of ''dealer'' as given in para. 2(a) of the Sugar Dealers Licensing Order, 1963, was kept alive by the provisions of Clause (2) of para. 17 of the Sugar (Control) Order. 1966, as made by the Central Government. It will be seen that the definition of ''dealer'' as given in para. 2(a) of the West Bengal Sugar Dealers Licensing Order, 1963, is inconsistent with the provisions as made in the Sugar (Control) Order, 1966, by the Central Government. In this connection, I may refer to an unreported Bench decision of this Court, in the case of Sumerchand Chandra Sen v. Chief Commercial Superintendent, Eastern Railway and Ors. F.M.A. No. 184 of 1969 decided on June 8, 1976 and three other cases F.M.A. No. 188 of 1969, F.M.A. No. 582 of 1968 and F.M.A. No. 616 of 1968, decided on June 8, 1976. In this case, question arose whether the aforesaid West Bengal Sugar Dealers Licensing Order stood repealed. It was held in that, case that the West Bengal Sugar Dealers Licensing Order, 1963, shall be deemed to have been repealed by the aforesaid Central Order, namely the Sugar (Control) Order, 1966. I respectfully agree with the views expressed in that decision. I, therefore, hold that the Petitioners are entitled to return of the seized sugar but on execution of bonds to the satisfaction of the learned additional Chief Metropolitan Magistrate, Calcutta.

In the result, both the Rules are made absolute. The impugned orders of the learned Judge of the City Sessions Court are hereby set aside. It is further directed that the Petitioner Prahlad Rai Shah and Satyanarayan Agarwalla do get back the seized sugar as claimed by them respectively on execution of proper bonds to the satisfaction of the learned Additional Chief Metropolitan Magistrate, Calcutta. Let the records go down immediately.