KALIDASA TRADERS v. STATE OF KARNATAKA — 1974 DIGILAW 230 (KAR)

( 1 ) THIS petition is directed against the order dt. 13-5-1974 passed by the sessions Judge Chitradurga in Crl. MA. 32 of 1974 confirming the order dt. 22-4-1974 passed by the Dy Commr Chitradurga in Case CSD 4 COM 70/73-74 so far as the said order ol the Dy Commr related to confiscation of 186 bags of paddy seized by the authorities competent to effect such seizure under Cl. 11 of the Karnataka Paddy Procurement (Levy) Order 1966 (hereinafer referred to as the Order) from the premises of the mill 'siddalingsehwara Rice Mills Davanagere'. ( 2 ) ON seizure of considerable bags of paddy from the said mill the mill was called upon to disclose the source from which possession of the seized bags of paddy accrued. The records of the mill disclosed that the petitioner had sent these bags of paddy to the mill for hulling. It appears that the asst Commr who seized the paddy bags mentioned in his report not the full address of Kalidasa Traders but only as Kalidasa Traders. There is one firm functioning under the name and style ' Kalidasa Traders davanagree' in Davanagere. The petitionerfirm bears the same name but is functioning in Hiriyur In view of such a report of the Asst Commr the dy Commr issued notice to the Davanagere firm and the Davanagere firm appeared before the Dy Commr and submitted that it tad nothing to do with the seized bags of paddy. Thereafter the petitioner submitted an application before the Dy Commr on 4-4-1974 claiming ownership over these paddy bags and contending that the paddy bags had been sent to siddalingeshwara Rice Mills by it. The claim of the petitioner was gone into by the Dy Commr as required by S. 6a of the Essential Commodities act 1956 (hereinafter referred to as the Act ). The Dy Commr as already narrated held that 1200 bags of paddy seized from the said mill premises were to be confiscated. Out of these 1200 bags only 1062 bags were claimed by the petitioner as belonging to it. The petitioner preferred the said appeal before the Sessions Judge Chitradurga and the learned Sessions Judge passed the order now impugned. The Dy Commr as already narrated held that 1200 bags of paddy seized from the said mill premises were to be confiscated. Out of these 1200 bags only 1062 bags were claimed by the petitioner as belonging to it. The petitioner preferred the said appeal before the Sessions Judge Chitradurga and the learned Sessions Judge passed the order now impugned. ( 3 ) THE learned State Public Prosecutor contended at the out set that there were no bona fides in the claim put forward by the petitioner because it had put forward its claim at a belated stage while in fact the report of the Asst Commr showed that the petitioner-firm had nothing to do with the seized 1062 bags of paddy. The material already narrated in the preceding paragraph is sufficient to show that the report off the Asst Commr appeared to be vague inasmuch as the full particulars of the said owner of the paddy bags seized was not disclosed while the records maintained by the mill showed the petitioner as the firm which had sent that stock of paddy to the mill for purposes of hulling. ( 4 ) SRI C. N. Kamath the learned Advocate appearing on behalf of the petitioner pointed qut that the show-cause notice called upon the petitioner tot meet the contention that the petitioner had not produced the clearance certificate for having surrendered levy for the stocks stored in the rice mill premises under the Order and therefore the petitioner had contravened the conditions mentioned in the Order. He on this basis urged that the petitioner being a trader only and he haying purchased 747 bags of paddy from other traders and not from growers was not required to be in possession of clearance certificates for having surrendered levy for the said stock and that it was not incumbent on the petitioner even to ascertain whether levy on the said stock had been" surrendered or not and hence the show-cause notice issued by the Dy Commr was bad in law. The learned State public Prosecutor urged that all that was averred in the show- cause notice is that levy had not been surrendered as per the Order in regard to the said stock and therefore the petitioner had contravened the provisions of the Order. The learned State public Prosecutor urged that all that was averred in the show- cause notice is that levy had not been surrendered as per the Order in regard to the said stock and therefore the petitioner had contravened the provisions of the Order. ( 5 ) IT is apparent that the basis of the contention of Sri Kamath is the stress on the words "whereas you have not produced the clearance certicate for having surrenderd levy for the said stock". I am clear in my mind that the stress is not on the word 'produced'. What the notice clearly means is that there was no clearance certificate for haying surrendered levy for the said stock and hence there was breach of the provisions of the order. Merely because the petitioner was called upon to produce it does not mean that failure to produce would entail an order of confiscation. In fact that is not the ground on which the order of confiscation has been passed. Hence I do not propose to deal further with this contention of sri Kamathas in my opinion it is unnecessary. ( 6 ) SRI Kamath vehemently urged that the claim of the petitioner beding that he had puechased the said stock from other traders it is clear that cl. 8a of the Order was rot attracted to the facts and circumstances of this case and hence it could not be said that the petitioner had contravened any of the provisions of the Order. On the other hand the learned State public Prosecutor contended that Cl 8a of the Order lays down that even a trader purchasing paddy from another trader has to ascertain before purchasing that levy in regard to the stock intended to be purchased by him had been surrendered according to the provisions of the Order and failure to do so led to breach of the provision in Cl. 8a of the Order. Clause 8a of the Orders reads as follows: " 8. A restriction on the purchase of paddy from a grower ;no person shall purchase any paddy from any grower who is liable to sell paddy to the State Govt under Cl. 3 or Cl. 5 as the case may be unless such grower is in possession of a certificate granted to him by the enforcement Officer as required by Clause 8. 3 or Cl. 5 as the case may be unless such grower is in possession of a certificate granted to him by the enforcement Officer as required by Clause 8. " ( 7 ) SRI Kamath argued that the object of the Order is to see that a grower falling within its ambit compulsorily sells a portion of the paddy grown by him as regulated by Sen. I of the Order to the Govt Provision has been made in the Order to secure this object only. He further urged that it is to achieve this object that Cl. 7 Cl. 8 and Cl 8a have been incorporated in the Order. Cls. 7 and 3 cf the Order read as follows "7. Resections on the sale of paddy by grower. No grower shall out of the paddy grown in his holding and held in stock by him in respect of any crop sell or otherwise dispose of any paddy unless the quantity of paddy required to be sold by him under this order has been delivered as required under Cl. 3 or Cl. 5 as the case may be ( 8 ) ENFORCEMENT Officer to grant certificate regarding paddy soldi: the Enforcement Officer shall after verifying that the quantity of paddy required to be sold by a grower under the provisions of this order has been delivered to the State Govt or its authorised agent at the purchase point specified in the Order served under sub-clause (2) of Cl. 3 or under sub-cl. (2) of Cl. 5 as the case may be grant a certificate to such grower indicating that the quantity of paddy required to be sold by such grower has been sold by him. 8. The State Public Prosecutor contended that if Cl. 8a of the Order is interpreted to govern purchase from the grower only the object of the order would be defeated and hence it should be interpreted to govern purchase by a trader from a trader also. Cl. 8 of the Order lays down that every grower shall eut of the paddy grown in his holding and held in stock by him in respect of each crop sell to the State Govt or its authorised agent at the purchase price such quantiy of paddy in accordance with the scale specified in Seh. I as may be determined by the Enforcement Officer. I as may be determined by the Enforcement Officer. It is hence clear that it is incumbent on a grower who falls within the ambit of this Order to surrender levy to the State Govt in accordance with this clause. It is nowhere provided in the Order that any trader or any person who is not a grower but who procures paddy has to surrender' levy. This shows that a trader is not required to surrender levy. It hence follows that the Order does not contemplate a trader possessing a clearance certificate for having surrendered levy for the stock held by him. ( 9 ) IN order to ensure that a grower does not dispose of the paddy grown in his holding without surrendering the requisite levy as per the provisions of the Order Cl. 7 has been incorporated in the Order. A plain reading of Cl. 7 which has been narrated above discloses that to sell or otherwise dispose of any paddy unless levy is surrendered is to commit a breach of this provision and therefore breach of the conditions of the Order. In order to further ensure this object being achieved Cl. 8a has been incorporated in the Order. A plain reading of that clause which has already been narrated discloses that no person whether he may be a dealer (wholesale or retail) or a consumer is free to purchase paddy from a grower without ascertaining that the grower is in possession of a certificate mentioned in Cl. 8 of the Order. If the intendment was to bring purchases from traders within the ambit of Cl. 8a the necessary words or phrases would have been incorporated in Cl. 8a. Hence to interpret Cl. 8a as contended by the learned State Public Prosecutor would amount to introducing additional words or phrases into Cl. 8a. The learned State Public prosecutor contended in this regard that it would not be wrong to introduce the necessary words or phrases in Cl. 8a of the Order in order to see that the object of the Order is not defeat. ( 10 ) AS already pointed put the object of the Order is to see that a grower of paddy compulsorily surrenders levy to the State Govt and does not dispose of the paddy grown by him without surrendering such levy. 8a of the Order in order to see that the object of the Order is not defeat. ( 10 ) AS already pointed put the object of the Order is to see that a grower of paddy compulsorily surrenders levy to the State Govt and does not dispose of the paddy grown by him without surrendering such levy. The contention of the learned State Public Prosecutor is that any dealer purchasing from a grower can conveniently show in his record that he had purchased from another deader and sef at naught the provisions of the order. I do not see any fqrce in this contention because the dealings of a dealer (wholesale or retail) are governed by other Orders issued under S. 3 of the Act. Those Orders are: (1) The Karnataka Foodgrains (Wholesale) dealers Licensing Order 1964 and (2) The Karnataka Foodgrains (Retail Dealers) Licensing Order 1964. As per the provisions of those orders such dealers are required to take licences which in turn contain conditions. One of the important conditions which is common to both the licences is to submit retuins to the authorities mentioned therein in regard to stocks of foodgrains (essential commodities including paddy) procured by them disclosing even the source from which they are procured. It is for the concerned authorities to examine the returns and find out whether breach of any of the provisions of the Orders issued under S. 3 of the Act has been committed. If any such return discloses the source of procurement of paddy as the grower of the paddy then the authorities can very well ascertain whether Cl. 8a of the Order had or had not been complied with and take appropriate steps. Therefore the object of the Order as contended by the learned State Public Prosecutor could not be defeated by not interpreting Cl. 8a of the Order in the manner argued by him. In view of the foregoing reasons I hold that purchase of paddy from a trader does not at all attract the provisions of Cl. 8a of the Order. There is another substantial ground which supports this conclusion. If Cl. 8a of the Order in the manner argued by him. In view of the foregoing reasons I hold that purchase of paddy from a trader does not at all attract the provisions of Cl. 8a of the Order. There is another substantial ground which supports this conclusion. If Cl. 8a of the Order is interpreted as contended by the learned State Public prosecutor any consumer also who purchases even a little quantity of paddy from any trader would be required to ascertain whether the concerned grower was or not in possession of the certificate contemplated by cl. 8 of the Order in regard to that particulr quantity of stock that he purchases. It is too difficult to contemplate such an intendment in the Order. The learned Dy Commr and the learned Sessions Judge have not at all investigated into the claim of the petitioner whether that 747 bags of paddy had been procured by it by purchasing them from different traders as mentioned by the petitioner in its reply to the show-cause notice ). Both the authorities have held that even if it is for the sake of argument assumed that the petitioner had purchased the said stock of paddy from other traders such purchasers were governed by Cl. 8a of the Order and hence the petitioner had contravened the provisions of the Order. This view is not in my opinion correct. Therefore it is necessary to ascertain whether the claim of the petitioner that the petitioner had purchased 747 bags of paddy from other traders as mentioned by the petitioner in its reply to the show-cause notice is tenable or not. ( 11 ) THE learned State Public Prosecutor contended that Ss. 6a and 6b of the Act dealt with only breach of provisions of the Order or Orders issue4 under S. 3 of the Act and not with the aspect whether a particular owner from whose possession essential commodities had been seized had himself committed such breach or not. He further argued that in view of cl. 11 of the Order the burden was on the owner of the paddy to satisfy the Dy Commr and consequently the Sessions Judge that no breach of any provision of the Order had been committedwhether by him or anyone in regard to the stocks seized from him. Clause 11 of the Order reads as follows : " 11. 11 of the Order the burden was on the owner of the paddy to satisfy the Dy Commr and consequently the Sessions Judge that no breach of any provision of the Order had been committedwhether by him or anyone in regard to the stocks seized from him. Clause 11 of the Order reads as follows : " 11. Powers of entry search seizure etc. (1) Any Officer Off the Dept of Food and Civil Supplies or the Revenue Dept not below the rank of a Revenue Inspector may with a view to securing compiance with this Order or to satisfying himself that the provisions of this Order have been complied with: (a) enter into or search any premises vehicles vessels or other conveyances in which he has reason to believe that a contavention of this Order has been is being or is about to be committed; (b) selze the stock of paddy along with the packages coverings or receptaces in which such paddy is found and the animals vehicles vessels or other conveyances used in carrying such paddy in respect of which the Officer has reason to believe that a contravention of this order has been is being or is about to be committed. (2) The provisions of Ss. 102 and 103 of the Crlpc 1898 (5 of 1898) relating to search and seizure shall so far as may be apply to searches and seizures under this Clause. " ( 12 ) IT does not lay down that whenever such a seizure is effected by the author rities mentioned in the said Clause a presumption arises that breach of the "provisions of the Order had been committed until shown to the contrary. It is not possible to uphold the contention of the learned State Public Prosecutor in this behalf in the absence of such a provision in Cl. It is not possible to uphold the contention of the learned State Public Prosecutor in this behalf in the absence of such a provision in Cl. 11 or any o| the other provisions of the Order The contention of the learned State public Prosecutor that as per S. 6a of the Act a owner of the seized essential commodities has to satisfy the Dy Commr that no breach of any of the provisions of the Orders issued under S. 3 of the Act had been committed is not acceptable S. 6b of the Act specifically lays down that an order Of confiscation contemplated under S. 6a of the Act cannot be passed without a notice being issued to the owner of the essential commodity seized. It is too much to understand these prqvisions to mean that the burden is on a owner of such essential commoodities to satisfy the Dy Commr that neither he nor anyone else who had to deal with the seized essential commodities even on earlier occasions had committed breach of any of the provisions of the Orders issued under S. 3 of the Act. Such a owner can at the most produce material to show that he had not committed breach of any of the provisions of the Orders issued under S. 3 of the Act. It cannot be forgotten that by passing an order of confiscation in regard to essential commodities seized the owner from whom the seizure has been effected would be deprived of his property. ( 13 ) IN view of the fact that neither the Dy Commr nor the Session Judge has gone into the claim of the petitioner that the said 747 bags of paddy had been purchased by it from different traders it is necessary that the Dy commr is called upon to settle this question of fact and then dispose of the matter applying the law as settled in the preceding paragraphs. Therefore this petition is allowed. Orders dt. 13-5-1974 and 22-4-1974 passed by the Sessions Judge Chitradurga in Crl. M. A. 32 of 1974 and by the Dy Comr Chitradurga in Case CSD 4 COM 70 73-74 are set aside. The case is remanded to the Dy Commr Chitradurga for disposal according to law bearing in mind the observations made in the body of this order. --- *** --- .