LAXMINARAYAN RICE MILL v. STATE OF MADHYA PRADESH — 1980 DIGILAW 335 (MP)

JUDGMENT : ( 1. ) THIS revision is directed against the Order of the Judicial authority, maintaining the confiscation of the applicants 394. 50 Quintals of paddy under section 6-A of the Essential Commodities Act. 1955 for breach of condition Nos. 3 (i) to (iii) of the licence obtained by him, under section 3 of the M. P. Food grains Dealers Licensing Order, 1965. ( 2. ) THE facts, which are not in dispute, are briefly these: the applicant, who is the proprietor of the licensed Laxminarayan Rice mill at Lanji, has also a licence as a dealer under the M. P. Food grains dealers Licensing Order, 1965. On a surprise raid of his rice mill shop, godown and his house by the flying squad of the State Government on 23-2-1976, it was found, on physical verification of the applicant-dealers stock as per the entries in the food grains stock register, that 300 Quintal of paddy, stocked in his residential house, and 94-50 Quintals of paddy stocked in his rice mill premises, were not entered in the stock register; and as such, this stock, as found, was in excess of the stock entered in the stock register. The collector gave a show cause notice as to why this excess quantity of paddy should not be confiscated for breach of the terms of the licence. The applicant had filed his reply and was also given a hearing. After considering the evidence and all other material produced by the applicant, the Collector ordered confiscation of 394. 50 Quintals of paddy. Against this Order, appeal was preferred before the Judicial Authority, who dismissed the appeal; and maintained the Order of confiscation. Hence, now the applicants present revision. ( 3. ) THE learned counsel for the applicant-dealer has pressed before me the following points :- (1) The authorities below were wrong in disbelieving the defence stand and evidence of the applicant in the matter of purchases of 94. Hence, now the applicants present revision. ( 3. ) THE learned counsel for the applicant-dealer has pressed before me the following points :- (1) The authorities below were wrong in disbelieving the defence stand and evidence of the applicant in the matter of purchases of 94. 50 quintals of Paddy on the date of checking itself, by his authorised agent shyambihari from M/s Nandkishore and Sons; (2) Sub-clause (2) of Condition No. 3 of the Licence in Form B in the matter of licensees responsibility to "complete his accounts for each day on the date to which they relate", has not been properly interpreted by the authorities below; and as such, the applicant-dealer was entitled to complete his accounts and to make the relevant entry in the stock-register after the whole days work on 23-2-1976 in the matter of 94. 50 Quintals of paddy, purchased by his authorised agent Shyambihari from M/s Nandkishore and Sons. (3) 300 Quintals of Paddy, seized from the applicants residential premises, being the produce of the agricultural fields of his own and his joint minor sons, was not required to be shown, at all, in the dealers stock-register; and as such, was not liable for confiscation in view of the first proviso of section 6-A of the Essential Commodities Act. (4) The word "elsewhere" used in clause (3) of the condition No. 3 of the Licence in Form B, being concerned with the dealers business premises only i. e. his shop, godown, mill etc. and not with his "residential premises", the Judicial Authority and the Collector were both wrong in not correctly interpreting the word "elsewhere", in proper context; (5) Show cause notice, having contained no allegations in the matter of breach of any provisions of M. P. Rice Procurement (Levy)Order, 1970, the Collectors Order regarding confiscation is illegal as being not in conformity with the prescribed procedure under section 6-B (1)of the Essential Commodities Act. (6) Seizure of food grains viz. the paddy in question and consequently the confiscation thereof, was illegal, inasmuch as, the said food grains were not being removed, carried or disposed of, in which circumstance alone, and in none other, seizure of the stock of food grains was permissible under clause (d) of sub-section (I) of section II of the M. P. Food grains dealers Licensing Order, 1965, hereinafter referred to as the licensing order, 1965. State v. Basdeo Bawri and another, ( (1961) 1 Cr. L J 621 (Assam)) which was cited also before the authorities below is relied on, for support. ( 4. ) COMING to the point No. (I) above, it may be observed that the collector and the Judicial Authority both, are found to have disbelieved the defence stand and defence evidence of the applicant-dealer, in the matter of the circumstances regarding existence of excess quantity of 94 50 Quintals of paddy in the mill premises at the time of actual physical verification of the stock by the flying squad on the morning of 23-2-1976. The Collector, in para 14 of his Order and the appellate Court viz. the Judicial Authority, in paras 13 to 16 of its Order, have given elaborate cogent reasonings for disbelieving the defence stand and evidence, I see no reason and justification for interfering with the same in the present revision. Suffice to say that the defence story with regard to 94. 50 Quintals of paddy is a naive and ingenious concoction of the applicant-dealer, vainly sought to be justified by procuring fictitious evidence, both oral and documentary, from certain members of the local trading community. Such misplaced sympathy and wanton support of the trading community for their brother trader, who faces stringent action by the State against his omissions and commissions, is unfortunately not an uncommon sight. ( 5. ) NOW coming to the point No. (2), (3) and (4), it is to be seen as to what compliance was required to be made by the applicant-dealer in the matter of maintenance of daily accounts and further whether the applicant had contravened the terms and conditions of para No. 3 (i) to (iii) of the licence, issued to him in Form B under the Dealers Licensing Order, 1965. The law is well settled that the licence issued in Form B is an integral essential part of the controlling and regulatory system contemplated by the Licensing order. The conditions and the terms of a Licence by process of incorporation are made integral part of the Licensing Order itself; and, therefore, the breach of the conditions of the licence obviously amounts to contravention of the Licensing Order itself (See A. Kotiratnam v. State, (A I R 1974 A P 207.) and S. Kariappa v. State, (AIR 1971 Mys. 7. ). ( 6. 7. ). ( 6. ) IT would be worthwhile to reproduce below, the terms and conditions of para 3 (i) to (iii) of the Licence in Form B, under the M. P. Food grains Dealers Licensing Order, 1965 :- "3. (i) The licensee shall, except when specially exempted by the state Government or by the licensing authority in this behalf, maintain a register of daily accounts in Form B-I for each of the food grains mentioned in Paragraph I. (ii) The licensee shall complete his accounts for each day on the day to which they relate, unless prevented by reasonable cause the burden of proving which, shall be upon him. (iii) A licensee who is a producer himself shall separately show the stocks of his own produce in the daily account, if such stocks are stored in his business premises and elsewhere " Clause (i) of para 3 above of the licence, requires the licensee (dealer) to "maintain a register of daily accounts in Form B-I, clause (ii) requires him to "complete his accounts for each day on the date to which they relate" and clause (iii) requires him to "separately show the stocks of his own produce in the daily account, if such stocks are stored in his business premises and elsewhere". ( 7. ) NOW, clause (i) does not present any difficulty and the applicants learned counsel has no dispute regarding the purported requirement of this clause. In the matter of clause (ii), it has, however, been argued that considering the words used in this clause viz. "complete his accounts for each day on the date to which they relate", the obvious intent of the State Government is that, accounts for the particular day should be completed on that day itself i. e. by the end of the closure of business on that day itself. This argument does not appear to be sound. If such an interpretation is accepted, the licensee will have unbridled freedom to enter the accounts in his register of daily accounts at any time, during the course of the day, and even after the days business; and in such a case, the inspecting authority would never be able to make physical verification of the stocks as per the entries in the register of daily accounts; and the very purpose of maintenance of register of daily accounts will be frustrated. It may be remembered that the word "accounts" appearing in clause (ii) and the words "daily account" appearing in clause (iii)are closely linked up with the words "a register of daily accounts in Form B-I" mentioned in clause (i) in para 3. It naturally, hence, follows that as per clause (ii), the "accounts" which are required to be completed, are only those accounts which are required to be maintained in the register of daily accounts in Form B-I and the "daily account", in clause (iii) wherein separate stocks of own produce are to be shown, are those accounts which are required to be maintained in the register of Form B-I. Under the terms of licence, only this register viz. the register of daily accounts in Form B-I, and no other register, is required to be maintained. Clauses (ii) and (iii) of para 3 of the licence do not actually have any ambiguity, if these clauses are read with and interpreted in the light of the prescribed entries of the register of daily accounts as per the Form B-I. The note under the Form B-I deserves pertinent attention in this regard. It is as under : - "note.- (a) Each individual transaction of purchase exceeding ten quintals should be recorded, full name of the seller and his village being given in column (3 ). For purchases made in Ganj through a broker the name of the broker only need be mentioned. (b) Total of transactions, of purchases involving ten quintals or less, may be given as one entry at the end of each day in Column (5), (6) or (7)as the case may be. (c) Total of transactions of sales involving ten quintals or less should be given as the last entry at the end of each day in column (10), (11) or (12) as the case may be. " Clause (b) of the Note, permits the licensee to record in the register of daily account "total of transactions, of purchases involving ten quintals or less, as one entry at the end of each day". Likewise, clause (c) of the Note makes similar provision with respect to "total of transactions of sales involving ten quintals or less to be recorded as the last entry at the end of each day". Likewise, clause (c) of the Note makes similar provision with respect to "total of transactions of sales involving ten quintals or less to be recorded as the last entry at the end of each day". However, such a provision, permitting the recording of the entry at the end of each day, is not there, in clause (a) of the Note, which pertains to "each individual transaction of purchase exceeding ten quintals. " Omission of the words "at the end of each day" in clause (a) of the Note, thus leads to the clear inference that only the total of transaction, of purchases and sales involving 10 quintals or less, has been permitted to be recorded at the end of each day; and for the rest of the transactions i. e. for each other transaction of purchase exceeding 10 quintals, entries are required to be made immediately at the time of the transaction. ( 8. ) IN the present case, this question does not arise at all, for the reason that the Collector and Judicial Authority, both, have held that the individual transaction of 94. 50 Quintals of paddy was of the date 22-6-1977, and as such, the entry regarding the same ought to have been there in the register of the daily accounts, at the particular time when, on the next day, inspection of the register and verification of the stock was done by the flying squad of the state Department. However, presuming for the sake of argument that this transaction was of the date 23-2-1976, then also, the entry regarding the same should have been immediately recorded in the register of daily accounts after the whole stock of paddy under the transaction in question had been received and stocked in the mill premises. Obviously, hence there was a contravention of Clause (ii) of para 3 of the terms and conditions of the licence. ( 9. ) FURTHERMORE, there was also the contravention of Clause (iii) of para 3 of the terms and conditions of the licence, inasmuch as, 300 Quintals of paddy, found kept in the residential house, were not shown in the register of daily accounts of food grains. Before taking up the. ( 9. ) FURTHERMORE, there was also the contravention of Clause (iii) of para 3 of the terms and conditions of the licence, inasmuch as, 300 Quintals of paddy, found kept in the residential house, were not shown in the register of daily accounts of food grains. Before taking up the. question whether this stock of 300 Quintals of paddy, at all, required to be shown or not, in the register of daily accounts, it may be stated that the applicant-dealer has alleged these 300 Quintals of paddy to be his own produce from the agricultural lands belonging to his own self and to his minor sons. No doubt, the collector and the Judicial Authority have not given any clear finding as to whether or not it was the dealers own produce, but on the strength of evidence and material on record, I am clearly of the opinion that 300 Quintals of paddy kept in the applicant-dealers residential premises, was not his own produce, inasmuch as, there is no cogent and solid proof in this regard. There is only the bald statement of the applicant himself in this regard and there is no documentary evidence to show that the applicant really owns 40 or 50 acres of agricultural land in his name and those of his sons and that 300 Quintals of paddy was actually the produce of these lands. This fact could well be proved from the revenue records viz. jamabandis and khasras, but none of these documents have been produced and the bald statement of the applicant himself, in the absence of any cogent corroboration, does not deserve any reliance. Hence, 1 hold that 300 Quintals of paddy which was kept in applicants residential premises was not his own produce, but was part of his stock, as a dealer and licensee of food grains, which required to be recorded in the register of daily account in the same manner as other transactions of purchase and sales,required to be entered therein. ( 10. ) EVEN presuming for the sake of argument that this stock of 300 Quintals of paddy was the applicants own produce from cultivation of his own agricultural lands, even then also, such stock-required to be shown separately in the register of daily accounts as enjoined by Clause (iii) of para 3 of the terms and conditions. ( 10. ) EVEN presuming for the sake of argument that this stock of 300 Quintals of paddy was the applicants own produce from cultivation of his own agricultural lands, even then also, such stock-required to be shown separately in the register of daily accounts as enjoined by Clause (iii) of para 3 of the terms and conditions. The contention of the applicants learned counsel that the term "elsewhere" used in Clause (iii) of para 3 of the terms and conditions of the Licence, is con not active of godowns or any such premises connected with the licensees business, is obviously without any merit There is a separate provision regarding storing of food grains in the "godowns" and this provision is Clause (ii) of para 2 of the terms and conditions of the licence. In this clause also, the words "at any place" have been used. If the drafting intent were to equate the term "elsewhere" in Clause (iii) of para 3 with the word "godown", then, obviously, the word "godown" alone would have been used in Clause (iii) and not the word "elsewhere". It is, hence, obvious that the word "elsewhere" in Clause (iii) of para 3 of the terms and conditions of the Licence, has a much wider connotation than the one, as tried to be suggested; and as such, the word "elsewhere" used in clause (iii) of para 3 is intended to cover and include any place whatsoever,-be it a godown or a residential premise or any other premises, of whatever nature they be. Therefore, the applicant-licensee, having not shown separately 300 Quintals of paddy,-even if it be his own produce,-in the register of daily accounts to be maintained in Form B-I, has contravened Clause (iii) of para 3 of the terms and conditions of the Licence. ( 11. ) THE point No. (5) pressed before me, is obviously misplaced and misconceived. Show cause notice (at page 37 of the Collectors record)related only to the breach of Clauses (ii) and (iii) of para 3 of the terms and conditions of the Licence. This notice was not for breach of any provisions of the M. P. Rice Procurement (Levy) Order, 1970. Collectors Order of confiscation also does not rest on the premise of this breach viz. Rice Procurement (Levy) Order, 1970. This notice was not for breach of any provisions of the M. P. Rice Procurement (Levy) Order, 1970. Collectors Order of confiscation also does not rest on the premise of this breach viz. Rice Procurement (Levy) Order, 1970. There is only a passing reference of this Rice procurement (Levy) Order in the Collectors Order; and such a reference in the Collectors Order is of no effect and value, since, it has not been made the basis for confiscation of the stock of paddy in question. 11. Now coming to the last point viz. point No. (6), it is vehemently argued by the applicants learned counsel that the authority in question had no powers under the Licensing Order, 1965 to seize the stock of paddy and to finally confiscate it, inasmuch as, Clause (d) of sub-section (I) of section 11 of the M. P. Food grains Dealers Licensing Order, 1965, authorised seizure, only of such stock of food grains which may be removed or moved by some mode of conveyance and for such interpretation of Clause (d), reliance is placed on (Assam High Court), The State v. Basdeo Bawri and another which ruling has already been discussed and differentiated by the Judicial Authority and so also the Collector, in their respective orders. Applicants learned counsels argument in this regard is obviously misplaced and misconceived. The background of the case, referred to in the ruling cited above, was that the licensee in that case was alleged to have sold sugar in black-market which had been carried and removed from the stock, but the licensing authority had not seized that particular stock which had been sold away in black-market but had actually seized the other stock which was lying in the licensees godown. It was in this context that the Assam High Court had held that the stock lying in the godown which was seized, was not the offending commodity"; and as such, it could not be seized; and the sugar which had been sold in the black-market with relation to which, only the offence pertained, was the only offending commodity. It was in this context that the Assam High Court had held that the stock lying in the godown which was seized, was not the offending commodity"; and as such, it could not be seized; and the sugar which had been sold in the black-market with relation to which, only the offence pertained, was the only offending commodity. In this ruling, it has been clearly observed that the offence committed was with reference to the sugar which had been carried and removed from the stock and could not possibly have any reference to the sugar in stock against which no allegations were made of any illicit dealing and which, as such, could not be seized under Rule 9 (d) of the assam Sugar Dealers Licensing Order, 1959, whose provisions are similar to clause (d) of sub-section (I) of section II of the M. P. Food grains Dealers licensing Order, 1965. This ruling, therefore by no stretch of imagination, can be made applicable to the instant case, inasmuch as, the stock of paddy seized was actually the offending commodity due to the contravention of the terms and conditions of the licence in the matter of non-maintenance of proper accounts. ( 12. ) THERE is actually no ambiguity, necessitating interpretation of clause (d) of section 11 (1) of the Licensing Order, 1965. The plain reading of the same makes the intent very clear. Sections 11 (1) (d) of the Licensing order, reads as under:- "11. Power of Entry, Search, Seizure, etc.-The licensing authority or any other officer authorised by the State government in this behalf, may with such assistance, if any, as he thinks fit:-x x x x x (d) search, seize and remove stocks of food grains and the animals, vehicles vessels or other conveyances used in earring the said food-grains in contravention of the provisions of this Order, or of the conditions of the licence issued thereunder and thereafter take or authorise the taking of all measures necessary for securing the production of stocks of food grains and the animals, vehicles, vessels or other conveyances so seized in a Court and for their safe custody pending such production. " If the above Section 11 (1) (d) is read and appreciated in the light of the foregoing provisions of the Licensing Order, more particularly, Sections 2 and 3 thereof, it would be clear that this M. P. Food grains Dealers Licensing order, 1965, principally relates to storage, purchase and sale of the food-grains by the dealer. This Licensing Order apparently is not designed for restriction of movement of food grains. Had this been the case, it is normally expected that the Order in question would not have been termed as "food grains Dealers Licensing Order", but would have been termed as "food grains Restriction of Movement Order" or with such some terms, suggesting that the Order was designed for restriction of movement of food-grains. The fundamental principle of interpretation of statutes is that all the provisions must be harmoniously construed so as to achieve the object for which the law or statute is enacted. It is also a fundamental canon of interpretation that the intent of the Legislature should be gathered from the words used; and that if the words used, have not acquired technical meaning, they should be deemed to have been used in their ordinary, natural and grammatical meaning (See Jugalkishore v. Raw Cotton Company Ltd. , (AIR 1955 S C 376.) ). It is a very useful rule in the interpretation of a statute to adhere to the ordinary meaning to the words used and to the grammatical construction unless that is at variance with the intention of the Legislature to be collected from the statute itself, or leads to any manifest absurdity or repugnance, in which case, the language may be varied or modified so as to avoid such inconvenience, but no further. Becke v. Smith, ( (1936) 150 E R 724. ). Normally, the strict grammatical interpretation is often the safest guide for the construction of a statute, unless, the literal construction thereby defeats the very intent, object and policy of the statute sirajul Haq Khan v. Sunni Central Board. , (AIR 1959 S C 198.), Commissioner of Income-tax v. Teja Sing. , (AIR 1959 S C 352.) and The Regional Provident Fund Commissioner, Bombay v. Oudh sugar Mills, Ltd. , (AIR 1952 S C 1536) ( 13. , (AIR 1959 S C 198.), Commissioner of Income-tax v. Teja Sing. , (AIR 1959 S C 352.) and The Regional Provident Fund Commissioner, Bombay v. Oudh sugar Mills, Ltd. , (AIR 1952 S C 1536) ( 13. ) NOW, the plain reading and the simple grammatical construction of clause (d) of Section 11 (1) of the M. P. Food grains Dealers Licensing Order, 1965 clearly shows without any ambiguity that the Licensing authority or the officer authorised by the State Government in this behalf had the power to search, to seize and to remove, not only the "stock of food grains", but also "the animals, vehicles vessels, or other conveyances used ,in carrying the said food grains". The only condition for exercising the power of search, seizure and removal of these food grains and so also the animals, vehicles etc. was, that in the matter of items to be seized, there should either be contravention of the provisions of the Licensing Order or contravention of the conditions of the Licence, issued. These transitive verbs viz. search, seize and remove, qualify the nouns "food grains" and "animals, vehicles, vessels and other conveyances used in carrying the said food grains". These "food grains" and so also the transporting media i. e. animals, vehicles, vessels etc. are used as objects of the particular verbs "search, seize and remove". It Would, therefore follow that Clause (d) ibid is not solely intended for "search, seizure and removal" of such food grains which may be in the process of transport and removal. The intent of clause (d) ibid would, further, be clear if it is tried to be appreciated with the definition of "dealer" given in Section 2 in the Licensing Order, and the purpose of the issue of Licence as indicated in section 3 thereof. Intent would be further clear if one cares to equally scrutinize sub-section (2) (j) of Section 3 of the Essential Commodities Act, 1955, making like-references for entry and search. Grammatical construction of clause (d) of Section 11 (1) of the Licensing Order would be explicit to give even a lay-man if for convenience sake the said Clause is split and broken up in appropriate parts as under: - "11. Grammatical construction of clause (d) of Section 11 (1) of the Licensing Order would be explicit to give even a lay-man if for convenience sake the said Clause is split and broken up in appropriate parts as under: - "11. Power of Entry, Search, Seizure, etc.- (1) The licensing authority or any other officer authorised by the state Government in this behalf, may with such assistance, if any, as he thinks fit:-x x x x x (d) search, seize and remove :- (i) stocks of food grains; and (ii) the animals, vehicles, vessels or other conveyances used in carrying the said food grains; in contravention : (a) of the provisions of this order; or (b) of the conditions of the licence issued thereunder; and thereafter take or authorise the taking of all measures necessary for securing the production of stocks of food grains and the animals, vehicles, vessels or other conveyances so seized in a Court and for their safe custody pending such production. " ( 14. ) FROM the above, it is clear that in the instant case, the stocks of paddy which were seized in the mill premises and also from the residential premises, were actually the offending materials, in the matter of which, there was contravention of the conditions of the Licence; and as such, the authority in question was fully competent to seize the same. The Order of confiscation, therefore, is found to be fully justified without any illegality or irregularity and without any miscarriage of justice. No interference is called for, in the revision. ( 15. ) REVISION, hence, is dismissed; and the Order of confiscation, as passed by the Collector and affirmed by the judicial Authority is maintained in to to. Revision dismissed.