Crystal Diary Products v. Union of India — 1968 DIGILAW 270 (ALL)

JUDGMENT G.C. Mathur, J. - These writ petitions challenge the constitutionality of the Delhi, Meerut and Bulandshahr Milk and Milk Products Control Order, 1968 (hereinafter referred to as the Order) . Arguments have been addressed in Writ Petition No. 16% of 1968 and it has been stated by learned counsel for both sides that these arguments cover all the writ petitions. 2. The Order was made by the Central Government in exercise of the powers conferred upon it by Section 3 of the Essential Commodities Act, 1955. The preamble to the Order recites: "Whereas the Central Government is of opinion that it is necessary so to do for maintaining and increasing supplies of milk and for securing its equitable distribution in the areas comprising the Union Territory of Delhi and the District of Meerut and Bulandshahr in the State of Uttar Pradesh;" 3. It was to come into force on May 15, 1968 and to cease to operate on July 15, 1968. Clause 3 of the Order, which has been challenged and which contains its main provisions, reads thus : "3. No person shall - (a) use milk of any kind for the manufacture of cream, casein, skimmed milk, khoa, rubree, paneer or any kind of sweets in the preparation of which milk or any of its products except ghee is an ingredient; or export milk of any kind; or (d) sell, serve, supply or export or cause to be sold, served, supplied or ex-ported cream casein, skimmed milk, khoa, rubree, paneer, or any kind of sweets in the preparation of which milk or any of its products except ghee is an ingredient : "Provided that nothing in this clause shall apply - (i) to the use of milk for the manufacture of and to the sale, service, supply or export, of ice cream, kulfi, or kulfa, in the preparation of which no khoa, rubree or cream is used ; (ii) to the use of milk for the manufacture of and to the sale, service, supply or export of such milk products as the controlling officer may, having regards to the needs of the Defence Forces, by an order, permit." 4. Similar laws were made for the ad-joining areas of Haryana and Punjab.'For Haryana the Central Government made the Haryana Milk Products Control Order, 1968. Similar laws were made for the ad-joining areas of Haryana and Punjab.'For Haryana the Central Government made the Haryana Milk Products Control Order, 1968. and, for the State of Punjab, the Governor of Punjab made the Punjab Milk Products Control Order, 1966. Both. these orders were made under Section 3 of the Essential Commodities Act. The Punjab Order was challenged before the Supreme Court in S. Ajit Singh v. State of Punjab, W.P. 187 of 1966. By judgment dated February 24, 1967, the Supreme Court dismissed the writ petition and repelled the contentions that the Order violated Articles 14 and 19 (1) (g) of the Constitution. The impugned Order was challenged before the Delhi High Court in Civil Writs Nos. 413 and 441 of 1968 but the writ petitions were dismissed by a Division Bench of that Court, repelling all arguments including the argument that the Order violated Articles 14 and 19 (1) (g) of the Constitution. 5. Shri S.C. Khare has challenged the constitutionality of the impugned Order on the following three grounds : (1) That the condition precedent laid down by Section 3 of the Essential Commodities Act has not been satisfied in the present case and, therefore, the Order is ultra vires Section 3 ; 2. that the impugned Order discriminates between the residents of Meerut and Bulandshahr on the one hand and of Delhi on the other and this violates Article 14 of the Constitution; and 3. That the impugned Order imposes unreasonable restrictions on the rights of the residents of Meerut and Bulandshahr guaranteed tinder Article 19 (1) (g) of the Constitution. 6. Sec. 3 (1) of the Essential Commodities Act, 1955, provides : " 3 (1) - If the Central Government is of opinion that, it is necessary or expedient so to do for maintaining or in-creasing supplies of any essential commodity or for securing their equitable distribution and availability at fair price, it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein." 7. According to Shri Khare, this section lays down three conditions, at least one of which must exist before an order under section 3 can be made. According to Shri Khare, this section lays down three conditions, at least one of which must exist before an order under section 3 can be made. According to him, the Central Government should be of opinion that it is necessary or expedient either for maintaining or increasing the supply or securing equitable distribution of an essential commodity before the order can be made. His further contention is that with each of these conditions must coexist that further condition of availability of the commodity at fair prices. He has laid stress on the use of the words "and" before the words "availability at fair prices". His contention is that the words "availability at fair prices" go with each of the earlier conditions mentioned, namely, 'maintaining, increasing and securing equitable distribution. The preamble to the impugned Order has already been set out above. The preamble recites all the three conditions but does not recite what Shri Khare contends is the essential condition, namely, the availability of milk at fair prices. I am unable to accept Shri Khare's interpretation of Section 3. There might have been some substance in his contention if the language of the relevant part of Section 3 had read "for maintaining or increasing supplies or securing equitable distribution and availability at fair prices of an essential commodity". As the language stands, it is not possible to read the words "and availability at fair prices" with each of the earlier conditions mentioned. In my opinion, the earlier part of the section, which reads "for maintaining or increasing supplies of an essential commodity", is complete by itself and lays down two separate conditions, namely, (i) maintaining supplies of an essential commodity; and (ii) increasing supplies of an essential commodity. 8. The opinion as to the existence of either can validly support an order under Section 3. The later part of Section 3 reading "or for securing their equitable distribution and availability at fair price" lays down another condition or conditions under which an order can be made. If the intention was, as Shri Khare suggests, that with each of the three conditions must coexist another condition of availability at fair prices, then there was no point in using the words "of an essential commodity" immediately after the words "maintaining or increasing supplies" and before the other condition or conditions are set out. If the intention was, as Shri Khare suggests, that with each of the three conditions must coexist another condition of availability at fair prices, then there was no point in using the words "of an essential commodity" immediately after the words "maintaining or increasing supplies" and before the other condition or conditions are set out. The use of these words at this place shows that the intention was to make the first two conditions independent and complete and not dependent on the conditions mentioned subsequently. An order could validly be made under Section 3 if the Central Government was of opinion that it was necessary or expedient to do so for maintaining or increasing supplies of any essential commodity. The section does not require that, in addition to these two conditions, the Central Government should also be of opinion that it is necessary or expedient to make the Order for securing the availability of an essential commodity at fair price. It is not necessary in this case to decide whether the third condition "for securing their equitable distribution and availability at fair prices" is one condition or two independent conditions. Whether these words provide for one condition or two depends upon whether the word 'and' has been used disjunctively or conjunctively. It is argued by the learned Advocate General appearing for the respondents that the word 'and' has been used disjunctively and should be read as 'or'. Even if the word is read conjunctively and it is held that the later part of Section 3 lays down either one condition or two conditions which must coexist, it does not affect the present case. In the present case, the preamble to the impugned Order clearly states the existence of the first two conditions and that is sufficient for upholding the constitutionality of the Order. Shri Khare's contention can only mean that there is no recital as to the existence of the third condition. Since the existence of any one of the conditions would be sufficient for making the Order under Section 3, the non-existence of the third condition, when the first two conditions do exist, cannot affect the validity of the Order. The first contention of Shri Khare must accordingly be rejected. 9. Before considering the second and the third contentions, certain facts have to be noticed. According to the petition itself, the Union Territory of Delhi does not pro. The first contention of Shri Khare must accordingly be rejected. 9. Before considering the second and the third contentions, certain facts have to be noticed. According to the petition itself, the Union Territory of Delhi does not pro. duce sufficient liquid milk for the consumption of the residents therein and milk is supplied by the adjoining districts of Gurgaon and Rohtak in the State of Haryana and by the districts of Meerut and Bulandshahr in the State of Uttar Pradesh. It also appears that Delhi gets milk from some of the adjoining districts of Punjab also. It cannot be disputed that milk is an essential commodity and it is a very important item of food. In the judgment of the Supreme Court upholding the validity of the Punjab Order, it was observed: "In India, and especially amongst the people who either do not eat non-vegetarian food or cannot afford its milk is the best source of animal protein." 10. It is well known that liquid milk is essential for growing children and for the old and infirm people. It is also an admitted fact that the production of natural milk goes down considerably during summer months. It also cannot be disputed that if fresh liquid milk is diverted for use in the manufacture of milk products like cream, casein, skimmed milk, khoa, rubree, paneer or sweetmeats the availability of fresh liquid milk would be seriously affected. From these facts it is clear that the imposition of restrictions on the use of milk for the manufacture of milk products is in the interest of the general public. Shri Khare contended that the impugned Order was made for the purpose of helping the Delhi Milk Scheme and not the general public and was mala fide. There is nothing on the record to establish that the Order was made in the interest of the Delhi Milk Scheme. It is true that, on account of the Order, a larger quantity of milk was available in Delhi and some portion of it was received by the Delhi Milk Scheme but there is nothing to show what proportion of the extra milk made available in Delhi on account of the impugned Order was received by the Delhi Milk Scheme. That apart, whatever milk was received by the Delhi Milk Scheme was distributed by it to the consumers in Delhi. That apart, whatever milk was received by the Delhi Milk Scheme was distributed by it to the consumers in Delhi. The Delhi Milk Scheme was not treated differently from other persons dealing in milk and the same prohibitions applied to it which applied to others. Since the object of the Order is that more milk should be made available to the general public, I can see nothing sinister in the Delhi Milk Scheme also receiving more milk on account of the impugned Order. The petitioners have failed to establish that the Order was made mala fide. 11. The next contention, which may be considered, is regarding discrimination against residents of Meerut and Bulandshahr. According to Shri Khare, this discrimination results in three ways; The first is that the skimmed milk, which some of the residents of Meerut and Bulandshahr consume, will not be available to that while the residents of Delhi will be supplied with skimmed milk by the Delhi Milk Scheme. It is to be noticed that, under the impugned Order even the Delhi Milk Scheme cannot prepare skimmed milk out of liquid milk. It is contended that a large quantity of milk powder has been donated to the Delhi Milk Scheme by foreign countries and the Delhi Milk Scheme can make skimmed milk out of that and can make it available to the residents of Delhi. Assuming that that is so, it is not the impugned Order which discriminates between the resident of Meerut and Bulandshahr on the one hand and of Delhi on the other. The impugned Order treats them alike. The fact that, out of the donation of milk powder, the residents of Delhi can be supplied with skimmed milk has nothing to do with the impugned Order and cannot affect its validity. The second is that, in Meerut and Bulandshahr, there is ample supply of fresh milk throughout the year and sufficient butter is normally prepared for the residents but the imposition of restrictions on the manufacture of cream has totally stopped the manufacture of butter as butter is manufactured in these districts from cream. It is further contended that, in Delhi, the Delhi Milk Scheme itself has a large stock of butter and large orders have been placed by the Government for butter from other places for Delhi and this results in discrimination against the residents of Meerut and Bulandshahr. It is further contended that, in Delhi, the Delhi Milk Scheme itself has a large stock of butter and large orders have been placed by the Government for butter from other places for Delhi and this results in discrimination against the residents of Meerut and Bulandshahr. The impugned Order itself does not make any discrimination between the residents of Delhi, Meerut and Bulandshahr. It does not permit the Delhi people to manufacture butter out of cream. It places the same restrictions on the residents of all the three districts. From the fact that the Delhi Milk Scheme has some stock of butter or that the local Government has arranged for the import of butter it cannot be inferred that the impugned Order discriminates against the residents of Meerut and Bulandshahr. It is equally open to the dealers and traders of Meerut and Buland shahr as well as to the local Government to import butter from adjoining districts or from other states for the consumption of the residents. The third is that the exemption in favour of the manufacture of ice cream has been made in the interest of the ice cream manufacturers of Delhi only. According to Shri Khare, ice cream is manufactured in very large quantities in Delhi and is exported outside from Delhi and the exemption has made in favour of ice cream only to help the ice cream manufacturers of Delhi and the requirements of the people of Meerut and Bulandshahr have been overlooked. A similar argument had been raised before the Supreme Court in the case relating to the Punjab Order but was repelled by the Supreme Court on the ground that the amount of milk consumed in the manufacture of ice cream in Punjab was insignificant. It was further observed by the Supreme Court that ice cream is nothing but sweetened milk which has been frozen and that it has the same value as liquid milk. In the counter-affidavit, it has been stated that only an insignificant portion of liquid milk is used in the manufacture of ice cream in Delhi. The petitioners have not produced any reliable material to show what proportion of liquid milk received in Delhi is used in the manufacture of ice cream. In the counter-affidavit, it has been stated that only an insignificant portion of liquid milk is used in the manufacture of ice cream in Delhi. The petitioners have not produced any reliable material to show what proportion of liquid milk received in Delhi is used in the manufacture of ice cream. In view of the fact that ice cream has the same food value as liquid milk and also in view of the fact that it has not been proved that any significant portion of liquid milk is diverted to the manufacture of ice cream, it is not possible to hold that this exemption is bad and creates any discrimination. So far, as the impugned order is concerned, it permits every one, whether in Delhi or in Meerut or Bulandshahr, to manufacture ice cream. The attack on the ground of Article 14 of the Constitution must accordingly be rejected. 12. I now come to the last contention of the petitioners that the impugned Order places unreasonable restrictions on the residents of Meerut and Bulandshahn This contention is based on the assertion that in Meerut and Bulandshahr, butter is manufactured mostly from cream and the ban on the manufacture of cream has resulted in a ban on the manufacture of butter. The argument is that the manufacture of butter itself is not prohibited by the impugned Order and, therefore, it is legitimate for the petitioners to manufacture butter but the ban on the manufacture of cream makes it impossible for them to carry on their trade or business of manufacturing butter. It appears from the counter-affidavit that, before the impugned Order was made, 25 to 30 per cent of liquid milk was used in the extraction of cream. If the extraction of cream were permitted, then of the object of the impugned Order would be frustrated. It may well be that the Central Government did not totally prohibit the manufacture of butter as the manufacture of butter by methods other than from cream did not significantly affect the availability of liquid milk and that it prohibited the manufacture of cream and, consequently, of butter through cream as a large proportion of liquid milk was being used in the extraction of cream. It is true that the prohibition on the manufacture of cream seriously affects the rights of the petitioners and some others to manufacture butter out of cream, but the restriction is in the interest of general public for making liquid milk available to it. I am unable to hold that the impugned Order offends Article 19 (I) (g) of the Constitution. 13. There is thus no force in any of the contentions raised by the petitioners. The writ petitions are accordingly dismissed. In the circumstances of the case, there will be no order as to costs.