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1978 DIGILAW 212 (MP)

Bhagwati Bidi Leaves Company v. State of M. P.

1978-03-10

C.P.SEN, G.P.SINGH

body1978
Short Note : 1. The petitioner submitted tenders for appointment as agent for purchase and collection of Tendu leaves. The petitioner's tenders were accepted. The petitioner executed agreements in form 'C'. In all the units there was short collection. The petitioner was served with notices as provided in clause 6 (XX) of the agreement why compensation should not be recovered from it. It was the recovery which was challenged in the petition. Held : Section 4 (2) of the Madhya Pradesh Tendu Patta Viniyaman Adhiniyam, 1964 enacts that the terms, conditions and the procedures for appointment of agents shall be such as may be prescribed. Power to make rules is conferred by section 19 of the Adhiniyam. Under this section, the State Government may make rules to carry out all or any of the provisions of the Act, in particular, the Government is authorised to make rules in respect of any matter which is either expressly or impliedly required to be prescribed under the Act. It will thus be seen that rules could be made for prescribing the terms and conditions for appointment of agents. In exercise of the powers conferred on the Government by section 19 read with section 4 (2) of the Act, rule 3 (9) and form 'C' have been framed by the State Government. Clause 6 (XX) in form 'C', which provides for payment of compensation is a term on which the agent is appointed under section 4. In the opinion of this Court, clause 6 (XX) is valid and is well within the rule making power of the State Government. 2. The argument of the learned counsel is that the Government did not follow the rules of natural justice in enforcing clause 6 (XX) of the agreement against the petitioner. The Government in proceeding to recover the amount of compensation in accordance with clause 6 (XX) of the agreement is acting in pursuance of the agreement. It is not a statutory power. The rules of natural justice do not apply when a party exercises its rights under the terms and conditions of an agreement. The learned counsel argued that in fact the State Government is exercising its statutory powers as conferred by the Act and rules. In the opinion of this Court, the argument has no force. The Government has not invoked any provision of the Adhiniyam or the rules made thereunder for claiming compensation. The learned counsel argued that in fact the State Government is exercising its statutory powers as conferred by the Act and rules. In the opinion of this Court, the argument has no force. The Government has not invoked any provision of the Adhiniyam or the rules made thereunder for claiming compensation. The Government is only acting under the terms and condition of the agreement in particular clause 6 (XX). Moreover if the petitioner's contention is that, the Government is acting contrary to the terms and conditions of the agreement and that the petitioner is not liable to pay any compensation, the petitioner cannot come forward under Article 226 of the Constitution. It is well settled that contractual rights and obligations cannot be enforced under Article 226 of the Constitution. Petition dismissed.