(1) THIS appeal is directed against the judgment and order dated 14/6/1982 passed by the High court of Gujarat in Special Criminal Application No. 538 of 1982. The said special criminal application was moved before the High court for quashing the order passed by the learned Sessions Judge, Junagarh in Criminal Appeal No. 26 of 1982, affirming the order of confiscation of cement stored in 42,658 bags, which were found lying in Porbandar in two different godowns since raided by the officers of the Civil Supplies Department, Gandhi Nagar on 3/2/1982. The order for confiscation of the said quantity of cement was made under Section 6-A of the Essential Commodities Act for the alleged violation of the Gujarat Essential Articles (Licensing Control and Stock Declaration) Order, 1981 hereinafter referred to as Gujarat Control Order. It may be indicated here that such order of confiscation was made by the Collector of the district after issuing a show-cause notice and giving an opportunity of showing cause. It appears the authority concerned proceeded on the footing that although the respondent was engaged in an inter-State sale and the cement manufactured in the State of Gujarat used to be taken to the State of Maharashtra for the purpose of sale in that State, the aforesaid quantity of cement had in fact been stored in contravention of Gujarat Control Order, with an intention to effect sale within the State of Gujarat. The respondent however contended inter alia that more than 14,000.00 metric tonnes of cement had in fact been purchased by the respondent and 4/5th of such quantity of cement had already been despatched to Bombay for inter-State sale. The aforesaid 42,658 bags of cement had been stored in their godowns in the State of Gujarat as such quantity of cement could not be despatched at the relevant period for want of proper transportation facility. (2) IT appears that the case of the respondent was not accepted by the confiscating authority and an order of confiscation of the said 42,658 bags of cement was passed. An appeal was preferred by the respondent before the learned Sessions Judge, Junagarh. (2) IT appears that the case of the respondent was not accepted by the confiscating authority and an order of confiscation of the said 42,658 bags of cement was passed. An appeal was preferred by the respondent before the learned Sessions Judge, Junagarh. The learned Sessions Judge, Junagarh inter alia came to the finding that although there had been a transport strike for a few days but had there been bona fide intention to despatch the said quantity of cement, the same could have been transported earlier and the explanation that for want of proper facilities of the transportation, the said quantity of cement had been stored within the State of Gujarat beyond a period of 15 days, was not convincing and acceptable. Proceeding on the footing that such quantity of cement had in fact been stored with an intention to effect sale or user within the State of Gujarat without complying the provision of the Gujarat Control Order, the order of confiscation was held justified by the learned Sessions Judge. (3) BEING aggrieved by the order passed by the appellate authority, an application under Article 227 of the Constitution of India was moved before the Gujarat High court and the impugned judgment has been passed by the Gujarat High court allowing the said application and setting aside the order of confiscation. (4) THE Gujarat High court has indicated that the agent of the respondent had affirmed an affidavit staling inter alia that the said amount of cement was not intended to be sold within the State of Gujarat but kept for despatching to Bombay. There was no material to indicate that there was really any intention to effect sale of the said cement within the State of Gujarat. The High court has held that as the quantity of cement was substantial, the authorities concerned appeared to have proceeded on surmise and conjecture that the said quantity of cement was in fact intended to be sold in Gujarat and with such intention stored in the godowns within the State. The High court has indicated that the learned Sessions Judge, Junagarh had not come to a finding that the affidavit affirmed by the agent of the respondent was unreliable and liable to be rejected for any valid reason. The High court has indicated that the learned Sessions Judge, Junagarh had not come to a finding that the affidavit affirmed by the agent of the respondent was unreliable and liable to be rejected for any valid reason. The finding that the said amount of cement stored in the godown was intended to be sold or used within the State of Gujarat, without obtaining a valid licence under the Gujarat Control Order was made in the absence of sufficient materials warranting such finding on an objective basis. The finding lay in the realm of surmise and conjecture and therefore unjustified. It appears that a contention was also raised before the High court that under clause 18(5 of the Gujarat Control Order any person who was not a licensed dealer under the Gujarat Control Order was also required to make a declaration of the stock under the Gujarat Control Order if such person had stored the aforesaid quantity of cement in the State of Gujarat. Since, the respondent had in fact stored cement beyond permissible limit the respondent was under an obligation to make a declaration and the respondent not having furnished such declaration must be held to have contravened the provisions of Gujarat Control Order thereby becoming liable for confiscation of the said cement under the Essential Commodities Act read with Gujarat Control Order. Such contention has not been accepted by the High court by indicating that clause 18(5, if read in the proper context, cannot be made applicable for storage of cement for inter-State sale because the Gujarat Control Order having been passed under the delegated authority of the central government, under the Essential Commodities Act must be confined for sale and user of the essential commodity within the State of Gujarat and it cannot affect inter-State sale. In that view of the matter, the High court quashed the order of confiscation by setting aside the judgment of the learned Sessions Judge. (5) THE learned counsel for the appellant has contended that the State government under the Gujarat Control Order may not be competent to restrict and control inter-State sale and such attempt has also not been made under the Gujarat Control Order. But the State government is certainly within its right to regulate the sale user and storage of essential commodities within the State under such delegated legislation. But the State government is certainly within its right to regulate the sale user and storage of essential commodities within the State under such delegated legislation. It was within the competence of the State government to ask for compliance of clause 18(5 even for the purpose of storing of cement beyond certain limit within the State although ultimately the stored cement might have been intended to be sold outside the State. (6) WE are, however, unable to accept the said contention of the learned counsel tor the appellant. The opening words of clause 18 of the Gujarat Control Order clearly indicate that licence-holder under the Gujarat Control Order shall apart from any such conditions that may be imposed by the licensing authority, is required to observe other conditions as referred to in various sub-clauses under clause 18. One of such conditions is contained in sub-clause (5 of clause 18. Such opening words in clause 18 make it clear that conditions contained in various sub-clauses of clause 18 are applicable to licence-holders under the Gujarat Control Order. (7) IT appears to us that the control and regulation of essential commodities under the Gujarat Control Order are applicable in connection with the user and sale of such essential commodities within the State of Gujarat and storage of such commodities must be linked with the sale and user within the State and not in connection with inter-State sale. It also appears to us that High court is justified in holding that in the instant case the authority concerned and the learned Sessions Judge erroneously proceeded on the footing that the cement in question was stored at the relevant period not for the purpose of inter-State sale but for user within the State without complying the provisions of the Gujarat Control Order. Such finding was made not on consideration of relevant materials objectively but by basing the finding on surmise and conjecture and failing to appreciate that the respondent had been dealing with cement for sale in the State of Maharashtra and as a matter of fact more than 4/5th of the quantity procured by the respondent had been despatched to Bombay. A reasonable inference may be drawn from facts proved established or admitted. But such inference of fact must have an objective nexus to the fact proved, admitted or otherwise established and inference cannot be drawn on surmise and conjecture. A reasonable inference may be drawn from facts proved established or admitted. But such inference of fact must have an objective nexus to the fact proved, admitted or otherwise established and inference cannot be drawn on surmise and conjecture. It appears to us that in the instant case the cement in question remained stored in the godowns in the State of Gujarat and had not been transported to Bombay. Even if it is assumed that there was no valid justification for the delay in transportation of the cement in question, such delay by itself in the absence of other relevant materials cannot lead to an inference of storing for the purpose of user within the State. We, therefore, find no reason to interfere with the impugned order passed by the High court. The appeal therefore fails and is dismissed. (8) IT appears that during the pendency of this appeal, interim directions were made by this court on 4/11/1982 and on 12/12/1983 for disposal of the said quantity of cement on certain terms and conditions. In view of the dismissal of the appeal the appellant is directed to comply with the directions contained in the said orders within a period of 4 weeks from today. Liberty is given to the parties to apply for further directions if necessary. (9) LET Special Leave Petition (Cri) No. 2508 of 1985 be listed next week after showing the name of the learned counsel for the petitioner.