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1965 DIGILAW 413 (KER)

ABDUL RAHIMAN KUNJU v. STATE OF KERALA

1965-12-23

P.GOVINDA MENON, T.S.KRISHNAMOORTHY IYER

body1965
Judgment :- 1. The revision petition is filed against the judgments of the courts below convicting the petitioner under S.13(1) read with S.8(1) of the Rice Milling Industry (Regulation) Act, 1958 (Act 21 of 1958), hereinafter referred to as the Act, and sentencing him to pay a fine of Rs. 500/-. 2. The charge against the revision petitioner was that he established a new rice mill without obtaining a permit under S.5 of the Act.. The petitioner admitted that he did not take out a permit as required by S.5 of the Act but he contended that since the rice milling operations were carried on by him not for any profit, but for his own private use no such permit was necessary. Though the courts below found that the petitioner established the rice mill for his own use, they took the view that a permit under S.5 of the Act was necessary for the establishment of the mill. 3. The contention of the counsel for the petitioner was that the establishment of a rice mill for one's own purpose is not an 'industry' coming within the scope and ambit of the Act. According to him the Act was enacted by Parliament by virtue of Entry 52 of List I of the Seventh Schedule to the Constitution, and the expression 'Industries' in Entry 52 List I should be confined to those undertakings tainted with public interest and run for making profit. If the Act therefore takes within its sweep 'industries' established for one's private use, it is beyond the legislative competence of the Parliament with reference to Entry 52 in List I in the Seventh Schedule. 4. The learned Advocate General appearing on behalf of the State sought to justify the legislation not only under Entry 52 of List I but also under Entries 20, 23, 24 and 33(b) read with 47 of List III in Schedule VII of the Constitution. 5. We entertain no doubt that the Act comes under Entry 52 in List I of Schedule VII of the Constitution. 5. We entertain no doubt that the Act comes under Entry 52 in List I of Schedule VII of the Constitution. Entry 52 in List I reads: "Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest." The question arises what is the connotation of the term'industry' in Entry 52 List I. The interpretation contended for by the petitioner that 'industries' in Entry 52 List I should be restricted to those which cater to the needs of the public and which are worked for profit cannot be accepted. 6. The law is now well settled as to the rules applicable in the matter of construing Entries in the Lists in Schedule VII of the Constitution. 7. Subba Rao, J. in Calcutta Gas Company (Proprietary) Ltd. v. State of West Bengal (A. I. R.1962 S. C. 1044, 1049) observed thus: "The power to legislate is given to the appropriate Legislatures by Art.246 of the Constitution. The entries in the three lists are only legislative heads or fields of legislation' they demarcate the area over which the appropriate Legislatures can operate. It is also well settled that widest amplitude should be given to the language of the entries." Entry 52 in List I provides for 'industries' the control of which by the Union is declared by Parliament by law to be expedient in the public interest. The learned advocate for the petitioner relied on the meaning of the word 'industry' given in D. N. Banerji v. P. R. Mukherjee (A. I. R.1958 S. C. 58, 60) in these words: 'In the ordinary or non-technical sense, according to what is understood by the man in the street, industry or business means an undertaking where capital and labour co-operate with each other for purpose of producing wealth in the shape of goods, machines, tools etc. and for making profit." The question that was decided in 1953 S. C. 58 was whether the Industrial Disputes Act (1947) applied to Municipalities and their employees. The observations quoted above can be of no application in the interpretation of the expression 'Industry' in Entry 52 List I. 8. The word 'industry' occurs in Entries 7 and 52 in List I and Entry 24 in List II. "List I-Union List Entry 7. The observations quoted above can be of no application in the interpretation of the expression 'Industry' in Entry 52 List I. 8. The word 'industry' occurs in Entries 7 and 52 in List I and Entry 24 in List II. "List I-Union List Entry 7. Industries declared by Parliament by law to be necessary for the purpose of defence or for the prosecution of war. Entry 52. Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest. List II-State List Entry 24 Industries subject to the provisions of entries 7 and 5.2 of List I." 9. The scope of the term 'Industry' in Entry 52 list I was considered in Ch. Tike Ramji v. The State of Uttar Pradesh (A. I. R.1956 S.C. 676) where their Lordships of the Supreme Court observed at page 695: "'Industry' in the wide sense of the term would be capable of comprising three different aspects: (1) raw materials which are an integral part of the industrial process, (2) the process of manufacture or production, and (3) the distribution of the products of the industry. The raw materials would be goods which would be comprised in Entry 27 of List 2. The process of manufacture or production would be comprised in Entry 24 of List H except where the industry was a controlled industry when it would fall within Entry 52 of List I and the products of the Industry would also be comprised in Entry 27 of List 2 except where they were the products of the controlled industries when they would fall within Entry 33 of List 3." 10. Though it was contended in the above case that the word 'Industry' was of wide import and should be construed so as to include the acquisition of raw material necessary for the manufacture and production and disposal of the products of the industry their Lordships held rejecting the contention that the content of the word 'industry' means the process of manufacture and production. In Webster's dictionary the meaning of the word 'Industry' is given thus: "Systematic work or labour, habitual employment in some useful work, now especially in the productive arts or manufacture." If an activity is carried on by the employment of organised labour it is an Industry. In Webster's dictionary the meaning of the word 'Industry' is given thus: "Systematic work or labour, habitual employment in some useful work, now especially in the productive arts or manufacture." If an activity is carried on by the employment of organised labour it is an Industry. The term 'Industry' is not confined to any business, trade or calling carried on only for the benefit of the" public or for making profits. In view of what is stated above, it is not possible to accept the contention of the learned counsel that the 'Industries' in Entry 52 are those which are only run for profit and not for one's own use. 11. It was next contended by the learned counsel for the petitioner that even if the widest amplitude is given to the language of Entry 52 List I, the Act takes in within its sweep only Industries which cater to the needs of the public. Several provisions in the Act and the rules framed were relied on to substantiate his contention. The Act is intra-vires the Parliament and is relatable to Entry 52 in List I. As the preamble shows the Act has been passed to regulate the rice-milling industry in the interests of the general public. S.2 contains the declaration that it is expedient in the public interest that the Union should take under its control the rice-milling industry. S.3(g) defines "owner in relation to a rice mill" meaning the person who, or the authority, which has the ultimate control over the affairs of the rice mill, and where the said affairs are entrusted to a manager, managing director or managing agent, such manager, managing director or managing agent shall be deemed to be the owner of the rice mill and S.3(i) defines "rice mill' meaning the plant and machinery with which, and the premises including the precincts thereof, in which or in any part of which rice-milling operation is carried on. S.8(1) prohibits the establishment of any new rice mill after the commencement of the Act except under and in accordance with a permit granted under S.S, and S.8(2) prohibits the owner of a rice mill from carrying on rice-milling operation except under and in accordance with a license granted under S.6. There is no definition of the word 'Industry' or 'rice-milling industry' in the Act. There is no definition of the word 'Industry' or 'rice-milling industry' in the Act. S.3(d) defines "milling rice" meaning recovering rice or any product thereof from paddy with the aid of power. S.24 exempts any rice mill owned by the Government from the operation of the Act and S.18 empowers the Government to exempt rice mills or class of rice mills in any area from the operation of the Act in the public interest. The above mentioned provisions of the Act show that a permit under S.5 is necessary for the establishment of a rice mill and a license under S.6 is necessary for carrying on rice-milling operation whatever may be its object. But it was submitted by the petitioner's counsel that the preamble and Objects and Reasons to the Act and S.2 thereof containing the declaration, furnish the key to the understanding of the several provisions therein and if so understood, establishment of any rice mill or carrying on rice-milling operations for one's own private purpose is not taken in by the Act. Though elaborate arguments were addressed at the bar as to how far courts would be justified in relying on the preamble and objects and reasons to an Act, as an aid to its interpretation, it is unnecessary to deal with them in detail as the necessary principles for guidance have been stated by their Lordships of the Supreme Court in a number of decisions. 12. Subba Rao, J. observed in Kavalappara Kottarathil Kochunni v. States of Madras & Kerala (AIR. 1960 SC. 1080,1097): "The preamble of a statute is 'a key to the understanding of it' and it is well established that "it may legitimately be consulted to solve any ambiguity, or to fix the meaning of words which may have more than one, or to keep the effect of the Act within its real scope, whenever the enacting part is in any of these respects open to doubt". Mudholkar J. observed in M/s Burrakur Coal Co. v. Union of India (AIR. 1961 SC. 954, 956): "While holding that it is permissible to look at the preamble for understanding the import of the various clauses contained in the Bill this Court has not said that full effect should not be given to the express provisions of the Bill even though they appear to go beyond the terms of the preamble. 1961 SC. 954, 956): "While holding that it is permissible to look at the preamble for understanding the import of the various clauses contained in the Bill this Court has not said that full effect should not be given to the express provisions of the Bill even though they appear to go beyond the terms of the preamble. It is one of the cardinal principles of construction that where the language of an Act is clear, the preamble must be disregarded though, where the object or meaning of an enactment is not clear, the preamble may be resorted to explain it. Again, where very general language is used in an enactment which, it is clear must" be intended to have a limited application, the preamble may be used to indicate to what particular instances the enactment is intended to apply (Craies Interpretation of Statutes, 5th Ed. pp. 188, 189). We cannot, therefore, start with the preamble for construing the provisions of an Act, though we would be justified in resorting to it, nay, we will be required to do so, if we find that the language used by Parliament is ambiguous or is too general though in point of fact Parliament intended that it should have a limited application." 13. It was observed in Gujarat University v. Shri Krisha Ranganath Mudholkar (AIR. 1963 SC. 703, 718) "Statements of Objects and Reasons of a Statute may and do often furnish valuable historical material in ascertaining the reasons which induced the Legislature to enact a statute, but in interpreting the Statute they must be ignored " 14. Again in State of West Bengal v. Union of India (AIR. 1963 SC. 12411247) it was held: "It is however well-settled that the Statement of Objects and Reasons accompanying a Bill, when introduced in Parliament, cannot be used to determine the true meaning and effect of the substantive provisions of the statute. They cannot be used except for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation. But we cannot use this statement as an aid to the construction of the enactment or to show that the legislature did not intend to acquire the proprietary rights vested in the State or in any way to affect the State Governments' rights as owners of minerals. But we cannot use this statement as an aid to the construction of the enactment or to show that the legislature did not intend to acquire the proprietary rights vested in the State or in any way to affect the State Governments' rights as owners of minerals. A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeit a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the statute." 15. Venkatarama Iyer J. observed in Sundararamier & Co., v. State of Andhra Pradesh (AIR. 1958 SC. 468, 484): "Now, it is a well-known rule of interpretation that in order to understand the true nature and scope of an Act it is necessary to ascertain what the evils were which were intended to be redressed by it." and at page 485: "But the true nature of a law has to be determined not on the label given to it in the statute but on its substance." 16. We do not find any ambiguity in the enacting part of the Act. Even if there is any ambiguity, the preamble and the Objects and Reasons only confirm the construction we have adopted. The Statement of Objects and Reasons for the Act are stated thus: "It is necessary, in the general interest, to regulate the working of rice mills in such a manner that while, on the one hand, the handpounding industry gets reasonable facilities for development and employment is provided for the rural population, on the other, requisite facilities for conversion of paddy into rice are not curtailed, particularly at a time when efforts are being made to increase appreciably the production of paddy in the country. With this object in view, it is considered that the working of rice mills be regulated by the issue of licences, and the setting up of new rice mills, or the expansion of the existing rice mills be prohibited without the specific permission of the Government. The Bill aims at the achievement of these objectives as also to provide for certain other matters connected with the functioning of the rice mills." 17. The Bill aims at the achievement of these objectives as also to provide for certain other matters connected with the functioning of the rice mills." 17. The Act is therefore intended to regulate the working of rice mills to provide reasonable facilities for development of hand-pounding industry and to provide employment for rural population. If that is so, the Act is intended to regulate all rice-milling industries whether established for the benefit of the public or for making profit or otherwise. 18. The next submission of the learned advocate for the petitioner was that if the Act is interpreted to regulate rice-milling industries established for one's own use, it offends Art.19 (1) (f) and (g) of the Constitution as the restrictions imposed by the Act are not reasonable restrictions imposed in the interests of general public on the enjoyment of fundamental right by the petitioner. In determining the question of reasonableness of the restriction imposed in the interest of general public on the exercise of the fundamental right under Art.19 (1) (f) and (g) the Court cannot, as was observed in M. H. Quareshi v. State of Bihar (AIR. 1958 SC. 731, 744), "proceed on a general notion of what is reasonable in the abstract or even on a consideration of what is reasonable from the point of view of the person or persons on whom the restrictions are imposed? The test of reasonableness was laid down by their Lordships of the Supreme Court in The State of Madras v. F. G. Row (AIR. 1952 S. C. 196, 200) in the following terms: "It is important in this context to bear in mind that the test of reasonableness, where ever prescribed, should be applied to each individual statute impugned, and no abstract standard, or general pattern of reasonableness can be laid down as applicable to all cases. The nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict. The nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict. In evaluating such elusive factors and forming their own conception of what is reasonable, in all the circumstances of a given case, it is inevitable that the social philosophy and the scale of values of the judges participating in the decision should play an important part, and the limit to their interference with legislative judgment in such cases can only be dictated by their sense of responsibility & self-restraint & the sobering reflection that the Constitution is meant not only for people of their way of thinking but for all, and that the majority of the elected representatives of the people have, in authorising the imposition of the restrictions, considered them to be reasonable." 19. Examined in the light of the principles stated above, we hold that the Act does not offend the fundamental rights guaranteed to the petitioner under Art.19 (1) (f) and (g) of the Constitution. 20. No other point was raised before us. In the result, the Criminal Revision Petition h groundless and it is dismissed. Dismissed.