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1982 DIGILAW 84 (PAT)

Badal Krishna Chatterjee v. State Of Bihar

1982-07-19

SATYESHWAR ROY, SUSHIL K.JHA

body1982
Judgment Sushil Kumar Jha, J. 1. In this application under Articles 226 and 227 of the Constitution of India, the petitioner has challenged the legality and validity of the order/direction dated 5th May, 1981, issued by the Sub-division Officer, (Supply), Dhanbad, Respondent No. 2 (hereinafter to be referred to as the Licensing Authority), The copy of the impugned order/direction has been marked Annexure-1 to the writ application. By the impugned order/direction Respondent No. 2 in purported exercise of the powers conferred on him under Sec. 5 of the Bihar Coal Control Order, 1956 (hereinafter to be referred to as the Control Order) has directed all the licensees including the petitioner of the district of Dhanbad to shift their place of business namely, the coal depots mentioned in the respective licenses beyond the radius of 8 kilometers from the coal since and after such a shifting business to such a place they have been called upon to furnish the situs of their within one week to the Licensing Authority in order to enable him to suitably modify the place of business in the license in question. It has further been directed that if the place of business is not shifted beyond a radius of 8 kilometers from the coal mines it will be treated as a violation of the terms and conditions of the licenses for which the petitioner along with the other licensees of the district may incur cancellation of their licenses treating the same to be in contravention of the terms of the licenses and the dealers may further be liable for other actions under the law. The aforesaid order was received by the petitioner on 9th of May, 1961. The petitioner has challenged this order on a number of grounds. 2. Before, however, we embark upon the question of law canvassed at the Bar, it is worthwhile to set out the admitted facts as are borne out by the petitioner and the counter-affidavit filed on behalf of the respondents in this case. The facts are that the petitioner along with the other licensees in the district of Dhanbad were carrying on their retail coal business within a radius of 8 kilometers from the coal mines. The facts are that the petitioner along with the other licensees in the district of Dhanbad were carrying on their retail coal business within a radius of 8 kilometers from the coal mines. It was felt by the State Government that such a location of the coal depots where the business of the licensees was being carried on was neither commercially expedient nor suitable to the administrative exigencies. After deliberating from time to time the State Government took a decision that all such licensees be directed to shift their situs of business to a place beyond the radius of 8 kilometers from the coal mines in question. It may very well be presumed at this stage at least that the commercial expediency which the State Government thought of was to stop the clandestine delivery of coal from the coal mines leading not only to loss of public exchequer, but holding the society to reason in so far as the supply and distribution of coal for cooking purposes were concerned, to the loss of the licensees and the discomfiture of the domestic consumers of coal. The State Government having taken such a decision, the Commissioner for food, Supply and Commerce was directed to issue a circular who accordingly sent a circular to the Deputy Commissioner, Dhanbad, Ranchi Hazaribagh, Giridih and Santhal Pargana. It may not be out of place to mention here that only five districts have got coal mines beneath their surface, The circular issued by the aforesaid Deputy Commissioner, is letter No. 3688/Supply and Commerce Patna 15, dated 25th April, 1981. A copy thereof has been marked as Annexure S to the counter affidavit. It has been stated therein that the State Government having decided and having felt that the situation of coal dumps of private traders of the concerned coal mines is not desirable from the commercial and administrative point of view and having thoroughly gone into the matter the Government had decided that all the private traders must be shifted for the purpose of their coal business to a place beyond the radius of 8 kilometers from the coal mines. As a result of this circular having been issued at the instance of the State Government, a letter was addressed by the Deputy Commissioner, Dhanbad, to the Sub divisional Officer, Dhanbad, Chase, Respondent No. 2 to give effect to the decision of the State Government. As a result of this circular having been issued at the instance of the State Government, a letter was addressed by the Deputy Commissioner, Dhanbad, to the Sub divisional Officer, Dhanbad, Chase, Respondent No. 2 to give effect to the decision of the State Government. It was also directed that at least fifteen days time should be given to the licensees to shift the situs of their business to such a place which was beyond the radius of 8 kilometers from the coal mines, copy of this letter of the Deputy Commissioner dated 10th April, 1981, has been marked as Annexure A to the counter-affidavit. It was only pursuant to the aforesaid decision of the State Government and the letter issued by the Deputy Commissioner, (Annexure 8 and A respectively) that Respondent No. 2 issued order/direction as contained in the impugned annexure to all the licensees in the district of Dhanbad including the petitioner. We are, however, not concerned in this case with other licensees who have filed a separate writ application we confine ourselves only to the notice issued to the present petitioner alone, being an individual. 3. Learned Counsel for the petitioner challenged the legality of the aforesaid order/direction on the following ground. To use the language of Mr. S.B. Sinha, learned Counsel for the petitioner, himself, learned Counsel submitted that the impugned order was issued in the purported exercise of the powers under Clause 5 of the Control Order as already noticed above and the impugned direction/order is illegal because the condition precedent to the exercise of the power under Clause 5 of the Control Order being the need of the people of the locality having been absent in Annexure 1, Licensing Authority has no jurisdiction to issue such a direction/order in view of the fact that the power to choose a policy for a particular place expressly conferred upon the Licensing Authority, such power could not be exercised by the State Government. It was contended in this regard that although the State Government was higher authority but could not impose its own policy decision upon the Licensing Authority. The State Government could not itself exercise the power under condition 8 of the License in form A of the Control Order by way of policy decision, as condition 8 of form A of the Control Order confers no such general blanket power of the State Government. The State Government could not itself exercise the power under condition 8 of the License in form A of the Control Order by way of policy decision, as condition 8 of form A of the Control Order confers no such general blanket power of the State Government. In any view of the matter it was contended that since condition 8 of the license speak of sale, storage or accounting, these terms could not include the place or sites of business because of its being expressly the subject matter of the aforementioned Clause 5 of the Control Order itself. As such, it was submitted that the impugned order/direction was ultra vires Clause 5 of the Control Order and in event condition 8 of the License in form A having conferred on such blanket power on the State Government, condition 8 itself was ultra vires Clause 5 of the Control Order. Lastly it was submitted that such a policy decision which has already been mentioned above and the order/direction issued under the provisions of law which have given an arbitrary and unbridled power to the State Government to issue such order/direction, as has been issued from time to time have all violated the provisions of Article 14 of the Constitution of India. It was further submitted in this connection that it is well settled that a public body incorporated under the statutory power must take care not be exceed or abuse its power. It must be kept within the limits of the authority opted to it. It must act in good faith and it must act reasonably. In this case it has been strenuously contended that neither the State Government kept itself within the limits committed to it nor acted in good faith and reasonably. In support of this contention learned Counsel placed a number of decisions which are "Tahwr Hussain V/s. District Board, Muzzaffarnagar"A.I.R. 1954 S.C. 633 Messers Dwarka Prasad Laxtmi Narain V/s. State of Uttar Pradesh and Ors." -- Seshadri V/s. District Magistrate, Tanjore and Anr. -- Bharat Coking Coal Ltd. V/s. The Rancegunge Coal Association -- Commissioner of Police Bombay V/s. Gordhandas Bhanji -- Hukum Chand Sham Lal V/s. Union of India and Ors. -- Narendra Kumar Bose and Anr. V/s. District Magistrate and Ors. A.I.R. 1976 Pat. 241 Hamdard Dawkhanav. -- Bharat Coking Coal Ltd. V/s. The Rancegunge Coal Association -- Commissioner of Police Bombay V/s. Gordhandas Bhanji -- Hukum Chand Sham Lal V/s. Union of India and Ors. -- Narendra Kumar Bose and Anr. V/s. District Magistrate and Ors. A.I.R. 1976 Pat. 241 Hamdard Dawkhanav. Union of India -- Nageshwer Prasad Singh V/s. Rai Bahadur Kashinath Singh 1958 B.L.J.R. 820, None can take exception to this well established principle of law. As a matter of fact the decisions are legion on this point. But to our mind, none of these principles is attracted to the facts of the present case nor any of these decisions is relevant to the point in issue. 4. It has not been contended that the Control Order is ultra vires the Essential Commodities Act, 1955 (hereinafter to be referred to as the Act). The submission which has been the sheet anchor of the petitioners counsel is that the order/direction impugned is ultra vires Clause 5 of the Control Order and is not covered by Condition B of the license in Form A. We are, therefore, called upon to decide the limited question. The Control Order has been issued in purported exercise of the power conferred by Sec. 5 of the Act (X of 1955), read with Serial No. 1 of the Schedule appended to notification of Government of India, the Ministry of Production, No. S.R.G. 1299 dated the 10th June, 1956, and S.R.G. 2423, dated the 27th October, 1956, and in suppression of the Order of the Government of Bihar published with the Supply and Commerce Department Notification No. 23597-P, dated the 9th October, 1947, by the Governor of Bihar. Some of the clauses of the Control Order need be taken note of here. Clause 3 of the Control Order prohibits dealing in coal except under license. Clause 4 deals with the application for grant of license and stipulates that every application for the grant of license under this Order shall be made in Form B to the Licensing Authority and shall be accompanied by a treasury chalan showing that a fee of thirty rupees has been deposited in a Government treasury to the credit of the State Government. Thereafter comes the crucial Clause 5 which speaks of the grant of license which needs to be reproduced here and which runs thus: On receipt of an application under Clause 4, the Licensing Authority shall, if he is satisfied that the application is in order, the applicant is of sound financial capacity, enjoys good reputation and that there is a need for a dealer at the place or places where the dealer intends to carry on business as such, grant the applicant a license in Form A, The license shall specify the place or places at which the licensee may carry on the business in coal, and shall be subject to such conditions or exceptions as the Licensing Authority may from time to time, specify. The other sub-clauses of Clause 5 are not relevant for the present purpose. The only relevant clause that needs to be reproduced, for that shall have an important bearing on Condition 8 in Form A, is Clause 8 of the Control Order and which runs thus: Restriction against storage; No person other than a dealer shall keep or store in any premises occupied by him or permit any other person to keep or store in any such premises a quantity of coal exceeding ten mounds in standard weight, unless he has obtained a written permit from the licensing authority of the area in which the coal is kept or stored authorising him to do so and every such permit shall specify the quantity of coal permitted to be so kept or so stored. 5. From the aforesaid provisions it shall be seen that an application in Form B it is to be made to the Licensing Authority for the grant of the license and having regard to it the Licensing Authority may grant a license under Clause 5 in Form A to the intending license mentioning, of course, the place where the business is to be carried on. Condition 8 of the license granted in Form A reads as follows: The licensee shall comply with any direction that may, from time to time, be given by the State Government or by the Licensing Authority about the sale, storage, or accounting of coal. Admittedly the license has been granted to the licensee in Form A under the provisions of Clause 5 of the Control Order. Admittedly the license has been granted to the licensee in Form A under the provisions of Clause 5 of the Control Order. Undisputedly, therefore, Condition 8 in Form A of the license in a part of the license granted under the provision of Clause 5. It shall be seen from the expression mentioned in Condition 8 in Form A of the license that the license must comply with any direction that may, from time to time, be given by the State Government or by the Licensing Authority about the sale, storage or accounting of coal. Much was harped upon the points that the terms "sale, storage or accounting of coal" could not include the situs of business. It was contended that all the three items namely, sale, storage or accounting of coal" are related to the mode of either sale, storage or accounting or sale and storage with regard to any particular amount of coal. This argument has to be noted merely for the purpose of being rejected. As has already been noted above, Clause 8 of the Control Order itself, while speaking of restriction against storage, speaks of the premises occupied by the business man. Manifestly, therefore, sale or storage as well as the accounting shall have surely connection with the situs of business where the coal is to be sold, stored or accounted for. There is thus no merit in this submission. The contention is that under Clause 5 of the Control Order the place where the business was to be carried on by the licensee was to be fixed by the Licensing Authority only having regard, inter alia to the needs of the people in general or the residents of a place in particular. The State Government could not override its decision by any order/direction under condition 8 of the license. This submission is one of desperation, for the simple reason that Clause 5 itself speaks of the license in Form A being granted and, as has already been noted above Condition 8 of the license in Form A is an inseparable parts of Clause 5 of the Control Order. Now the only remaining question is as to whether the order/direction issued by the State Government with regard to the fixation of the vane or situs of the business of the licensee is based upon unreasonable consideration and is arbitrary. Now the only remaining question is as to whether the order/direction issued by the State Government with regard to the fixation of the vane or situs of the business of the licensee is based upon unreasonable consideration and is arbitrary. It is needless to say that such a policy decision in the interest of commercial expediency or administrative exigencies is not meant only for particular needs but for all the licensees in the areas concerned keeping in view the needs of all the people in the area in general. This cannot be said to be either arbitrary or unreasonable. It may be worthwhile to mention here as to what is meant by reasonable exercise of the discretion "it is true", said Lord Greene M.K. In Associated Provincial Picture Houses Ltd. V/s. Wednesbury Corporation (1948) 1 Kings Beach 223 at 229, the discretion must be exercised reasonably. Now what does that mean? Lawyers familiar with the phraseology commonly used in relation to exercise of statutory discretions often use the word "unreasonable" in a rather comprehensive sense. It has frequently been used and is frequently used as a general description of the things that must not be done. For instance a person entrusted with a discretion must, so took speak, direct himself properly in law. He must call his own attention to the matters which he is bound to consider. He must exclude from his consideration matters which are irrelevant to what he has to consider. If he does not obey those rules he may truly be said and often is said to be acting "unreasonably". But a decision can be called unreasonable only if it is proved to be unreasonable in the sense that the Court considers it to be a decision that no reasonable body could have done so. It is not what the Court considers unreasonable, a different thing altogether." In the instant case, can it be said that the State Government has not called its own attention to the matters which it is bound to consider? Can it be said that it has excluded the matter which are relevant and to which it has to consider? The answer obviously is in the negative, because the matters which have weighed with the State Government have clearly been given out in Annexure 8 of the counter-affidavit namely commercial expediency and administrative exigencies. Can it be said that it has excluded the matter which are relevant and to which it has to consider? The answer obviously is in the negative, because the matters which have weighed with the State Government have clearly been given out in Annexure 8 of the counter-affidavit namely commercial expediency and administrative exigencies. Nothing has been shown to us as to how the exercise of such a power in pursuance of a public policy amounts to illegal exercise of discretion or smacks of any indiscretion. 6 Although it may not be very necessary to refer to the two Bench decisions of this Court in this connection to which of course. Mr. Sinha was air enough to invite our attention we may as well add a few words about those decisions. Those two Division Bench decisions of this Court are in the cases of R. K. Coal Depot Parkombea V/s. Sub-Divisional Officer, Giridih C.W.J.C. No. 259 of 1980(R) and Ramchandra Rajbanshi V/s. Sub-Divisional Officer Giridih C.W.J.C. No. 960 of 1980(R). Both the cases were decided on 19th of July 1980. In both these decisions the order of cancellation of the license of the respective licensees was quashed on the ground that no area of limit of the radius within which the licensee can carry on its business has been indicated. But it was added by the learned Judges that if the State Government or Licensing Authority had fixed the situs of business being beyond a particular radius, that could have been very justified in law which have been conceded at the Bar in those cases. In C.W.J.C. No. 259 of 1988(R) aforementioned, judicial notice was also taken of the clandestine activities of the licenses participating in illegal pilferage and trade in coal. Mr. Sinha rightly argued that this observation could at best be treated as merely omits dicta. We are of the same view as has been held in the aforesaid decisions and respectfully agree with the observations made therein. 7. It was ultimately contended that since the place of business was present in the license in Form A, the licensee could not move to any other place of business because that would cause him a loss in transaction. This argument is again of no avail. 7. It was ultimately contended that since the place of business was present in the license in Form A, the licensee could not move to any other place of business because that would cause him a loss in transaction. This argument is again of no avail. In the order/direction it has been specifically stated, as has already been noted above, that after the petitioner moves its place of business to a venue beyond 8 Kilometers of the mines in question it may intimate such place of business and the license would be granted accordingly. There is thus no merit in this submission also. 8. No other point was advanced before us in this application. We accordingly find no merit in this application and it is dismissed accordingly. In the circumstances of this case there will be no order as to costs.