Research › Browse › Judgment

Patna High Court · body

1997 DIGILAW 615 (PAT)

Bajrang Lal Agarwal v. State Of Bihar

1997-08-27

P.K.DEB

body1997
Judgment P.K.Deb, J. 1. The petitioners are the accused in Gamharia P.S. Case No. 67 of 1992 (G.R. Case No. 33 of 1992) under Sec. 7 of the Essential Commodities Act. In this writ petitions, the petitioners have prayed for grant of appropriate writ for declaration that licence is not required by an Oil Miller under the provision of the Bihar Trade Articles (Licenses Unification) Order, 1984 (hereinafter to be referred to as the Unification Order) and consequently in violation of the terms and conditions of the licence cannot attract any criminal prosecution under Sec. 7 of the Essential Commodities Act. 2. Petitioners No. 1 and 2 are the partners of M/s. Shree Gopal Gil Mills, Gamharia, and petitioners No. 3 is their Munim. Shree Gopal Oil Mills is carrying on business of milling and manufacturing of edible oils and they were selling the product to the whole-sellers through commission agent or to the bulk consumer. The Mill/factory has been granted a licence under the Indian Factories Act. It is the further case of the petitioners that on the threat of prosecution they had been pressurised to obtain a wholesale license vide License No. 60 of 1985 under the Unification order. The Respondent No. 2 (Jai Prakash Choubey), the Supply Inspector on 11.11.1992 raided the factory premises of M/s. Shree Gopal Oil Mills and in that raid, high officers were also accompanied with the informant. As per the allegations against the petitioners during the course of raid, 73 tins of mustard oil was found in the stock but the opening stock was 285 tins of mustard oil as per the register maintained by the firm and during the physical verification 212 tins were found short. On 11.11.1992, 200 tins were sold on two separate challans. From 20.10.1992 to 11.11.1992,. no sale or purchase was shown in the stock register and it could also be found on verification of challans and cash memos that some fabrications were there which inferred that the sale of 200 tins were only a fictitious one. It was also alleged that proper display was not there regarding the stock, hence it was alleged that there was violation of Clause 20 of the Unification Order and as such the prosecution was lodged for violation of Clause 20 of the Unification Order and also regarding Terms No. 7 of the Licence. It was also alleged that proper display was not there regarding the stock, hence it was alleged that there was violation of Clause 20 of the Unification Order and as such the prosecution was lodged for violation of Clause 20 of the Unification Order and also regarding Terms No. 7 of the Licence. It was also alleged regarding the contravention of Clause 3 of the Bihar Essential Articles (Display of price and Stock) Order, 1977, 73 tins of mustard oil were seized and given in Zimmanama. After investigation, the Police submitted charge-sheet under Section 7 of the Essential Commodities Act and on receipt of the charge-sheet, the Learned Special Judge, E.C. Act, by order dated 9.2.1993 took cognizance against the petitioners under Sec. 7 of the Essential Commodities Act. 3. On appearance the petitioners took bail and then also filed a petition for their discharge on the ground that no license was required for the producer/manufacturer of edible oil and as such the Oil-Miller has no obligation to take any licence under the Unification Order and hence the question of violation of the Unification order or the terms and conditions of the license do not arise and, as such, the conditions is bad, but the said discharge petition has been rejected by the learned court below vide order dated 12.8.1994 and ordered for framing of charge under Sec. 7 of the Essential Commodities Act. 4. There are two contentions in this writ petition. Mr. S.L. Agarwal, learned Counsel appearing for and on behalf of the petitioners contended that under the Unification Order, as per the definition of producer/manufacturer, there is no provision for taking of license and even if it is taken, then they were liable to take licenceunder the Unification Order but for producer or manufacturer, there is no form prescribed for taking the license and hence the whole-sale license even if taken by the petitioners No. 1 and 2 cannot be said to be a legai one and superfluous one and for its violation, no prosecution can be lodged. 5. The second contention is that as per Clause 30 of the Unification Order, M/s. Shree Gopal Oil Mills being a Mill, search and seizure can only be made by an Executive Magistrate alone and below his rank, such seizure is illegal. 6. 5. The second contention is that as per Clause 30 of the Unification Order, M/s. Shree Gopal Oil Mills being a Mill, search and seizure can only be made by an Executive Magistrate alone and below his rank, such seizure is illegal. 6. A counter-affidavit has been filed on behalf of Respondent No. 2 and it has been stated in it that the manufacturer/producer of the Edible Oil or Oil Seeds are required to take licence under the Unification Order itself. Mr. P.D. Agarwal, appearing for and on behalf of the respondents has urged by showing the definition of the Central Order and the Unification Order that the producer/manufacturer of the oil seeds are also liable to take licence. 7. On the 1st contention, Mr. S.L. Agarwal, appearing for and on behalf of the petitioner referred to the definition of dealer as per Sec. 2(e) of the Unification Order read with Sec. 2(n) wherein producer has been defined. Sec. 2(e) reads as follow: dealer, eans a person, a firm, an association of persons or a Co-operative Society other than a National and State Level Co-operative Society engaged in the business of purchase, sale or storage for sale of any trade article whether or not in conjunction with any other business and includes his representative or agent but does not include: (i) A person who holds or is in possession agriculture land under any tenure or any capacity and on which he raises or has raised crop of food grains, oil seeds or whole pulses; (ii) a manufacturer of sugar; (iii) Hawkers engaged in the purchase and sale of non-controlled cloth. Sec. 2(n) of the Unification Order reads as follow: "producer" means a person carrying on the business of milling any of the pulses or expelling or extracting or manufacturing or refining any edible oil- (i) by buring pulses or oil seeds for being processed by himself and selling the finished products to a wholesaler or through a Commission Agent or to bulk consumers directly; (ii) by doing any of the processes of milling, extracting or manufacturing or refinding on behalf of another. 8. 8. The word manufacturer has not come within the definition part of Sec. 2 of the Unification Order, but producer shall mean manufacturer also as per the definition of the producer as mentioned above in Sec. 2(n) of the Unification Order but the Central Order of 1977 in the name and style of Pulses, Edible Oils and Oil-Seeds (Storage and Control) Order, 1977, has defined dealer under Clause 2(f) and producer under Clause 2(j). 9. As per the definition under the Central Order, 1977, dealer means a person engaged in the business of purchase, sale or storage for sale of any pulses, edible oilseeds or edible oils, whether or not in conjunction with any other business and includes his representative or agent. Producer which has been defined in the Central Order, 1977, under Clause 2(j) deals in the same as that of the definition of producer in Sec. 2(n) of the Unification Order. Central Order, 1977, makes provision under Clause 3 for licensing of dealers and producers. Therein the wordings "notwithstanding anything contained in the State Order" have been included while making provision for licensing of dealers and producers. Thus, under the Central Order, 1977, producers are required to take license also, but according to Mr. S.L. Agrawal, as the producer have not been included for the purpose of licence required under the Unification Order of the State as the State Order has been promulgated in 1984 cannot go back for the Central Order, 1977, for making the producer/manufacturer liable taking licence for edible oils and pulses. 10. Mr. S.L. Agarwal in support of his contention has referred to a Single Bench judgment of this Court in Parsuram Prasad alias Parsuram Mahto V/s. State of Bihar 1996 (2) PLJR 56 , wherein it was held by the learned Single judge that Dall Mill owner being a manufacturer and the producer cannot be asked for any license under the Unification Order as the Unification Order has not included producer/manufacturer within the ambit of license and no forms are provided for that. According to Mr. According to Mr. Agrawal, even if it is taken at the garb of Clause 3 of the Central Order, 1977 that under the State Unification Order, the manufacturer and producer are also liable for licence then also when no forms had been provided under the Schedule for licence for the producer or the manufacturer, then for not taking of licence or for violation of terms of licence or for any violation of the Unification Order of the State or the Central Order, 1977, the oil-mill owners cannot be held liable. He has referred to a judgment of the learned Single judge of this Court in Raj Ausdhalaya Swaraj Puri Lane Gaya V/s. The State of Bihar and Ors. 1996 (2) PLJR 53. That was a case under the Drugs and Cosmetics Acts and the manufacturer of Drugs for distribution has been held to not liable for obtaining any licence as no form of license of the manufacturer for distribution of drugs has been provided under the Act and no conditions have been laid down, subject to which, license may be issued. The same view has been taken by the Apex Court in Dr. Aletta Grace Bell V/s. Dr. S. Tirkey -- . Hence it is the submission of the counsel for the petitioners that even if the licence is required to be taken but as no form is prescribed for the manufacturer or producer or edible oil/pulses, then there remains a vaccum and for that there cannot be any prosecution for non-taking of licence and even if the licence is taken, that was taken under the pressure of the State authorities and hence there cannot be any prosecution for violation of any condition of licence. He has further for violation of any condition of licence. He has further referred to a judgment of the Allahabad High Court in Hari Oil and General Mills and Ors. V/s. State of U.P. and Ors. 1987 EFR 211. This judgment of the Allahabad High Court was referred by the learned Single judge of this Court in Parsuram Prasad (Supra). Allahabad judgment was tested before the Supreme Court and the judgment of Allahabad High Court has been upheld. That was the case under the U.P. Essential Commodities (Display of Price and Stocks and Control of Supply and Distribution) Order 1966. Allahabad judgment was tested before the Supreme Court and the judgment of Allahabad High Court has been upheld. That was the case under the U.P. Essential Commodities (Display of Price and Stocks and Control of Supply and Distribution) Order 1966. With reference to the definition of a dealer including retail dealer, wholesale dealer and that of manufacturer or producer under the U.P. Order as mentioned above, it was held by the Allahabad High Court that the manufacturer of producer is quite distinct from the wholesale dealer and retailer and as there was no provision in the U.P. Order for taking of licence by the manufacturer or producer then there is no scope for prosecution under Sec. 7 of the E.C. Act. 11. Every producer and manufacturer is definitely a dealer either wholesale or retailer because the manufacturer or producer would definitely sell their products either on wholesale or to bulk consumer through agent or directly, so the producer or manufacturer has got dealership inherent within it. So the producer or manufacturer is definitely a dealer and he deals with the products wither as a retailer or whole-sellter. Hence the producer or the manufacturer cannot be used totally form the dealership either wholesale or retail or in other words manufacturer or producer cannot be said to be district not connected with dealership at all. This matter was considered in its proper perspective by the State Legislative while putting the definition of the dealer under the Unification Order as per Clause 2(e). In the definition quoted above, only the manufacturer or Sugar has been excluded from the definition of dealer which directly infers that the manufacturer/producer of other essential commodities are within the purview of the definition of dealer as per Sec. 2(e). Only because separate definition has been given about the producer or manufacturer, it does not mean that they are to be debarred as dealer. It has already been stated that every manufacturer or producer is definitely a dealer. The definition of dealer as per U.P. Order as referred to in the judgment of Parsuram Prasad (Supra) is different from that of the Unification Order of Bihar, Here the definition of dealer includes the manufactures also except that of Sugar alone. It has already been stated that every manufacturer or producer is definitely a dealer. The definition of dealer as per U.P. Order as referred to in the judgment of Parsuram Prasad (Supra) is different from that of the Unification Order of Bihar, Here the definition of dealer includes the manufactures also except that of Sugar alone. If the definition of dealer in the Unification Order is read conjunctively with Clause 3 of the Central Order, 1977, regarding edible oil, it is clear that producer/manufacturer is also required to take a licence but whether their license would be of whole-seller or retailer would depend upon the style of business of individual producer/manufacturer. The State Order must be read harmoniously with the Central Order and if there is any gap or vacuum in the State Order, then Central Order must come into play in the field and the wordings "Notwithstanding...." etc. in the Central Order under Clause 3 eloquently speaks of the same. 12. In the present case, it has been stated categorically by the petitioners in paragraph 7 of the writ petition that Shree Gopal Oil Mills sells finished products through agent on wholesale or to bulk consumer, thus they come within the definition of whole-sale dealer as defined under the Unification Order itself and for that purpose, the petitioners had taken licence for the wholesale dealer and not for retail dealer. The question of separate form for producer/manufacturer of edible oils/pulses is not required as the manufacturer and producer under this particular food grain is included within the definition of dealership and under that concept, for the style of business, wholesale dealers license was rightly taken by the petitioner. When the petitioner is a licensee under the Unification Order, then any violation of the terms of license or clauses of the Unification Order would definitely attract the penal provision under the E.C. Act. Now coming to the decision of this Court as quoted above regarding Dal Mill Owner, I am quite aware that as per judicial discipline and decorum, I am bound by that decision. But it appears that the disputed points have not been placed in their proper perspective before the learned Single Judge. Now coming to the decision of this Court as quoted above regarding Dal Mill Owner, I am quite aware that as per judicial discipline and decorum, I am bound by that decision. But it appears that the disputed points have not been placed in their proper perspective before the learned Single Judge. Distinction of the definition of dealer in the Bihar Unification Order and that of the U.P. Order had either lost sight of or not canvassed while arguing in that case and hence the judgment was based on Allahabad judgment which was confirmed by the Apex Court and as such the decision of the Hon ble Single Judge is premium. 13. I have come to the conclusion as discussed above that definition of dealer under the Unification Order includes manufacturer/producer of edible oils/oilseeds also and, as such as a dealer, the petitioner oil mill has rightly taken a licence as required also under the Central Order as harmonious construction of both the Orders. Thus none of the judgments as referred to above are. applicable in the present case. The petitioners mill being wholesale dealer is liable to take licence and when license has already been taken, violation of terms and conditions of license and the clauses of the Unification Order renders the petitioners liable for prosecution. Thus I find that the submissions and contentions made on the first ground challenging the prosecution of the petitioners have got no force. The Supreme Court judgment as quoted above related to Drugs and Cosmetics Act. A Drug producer was manufacturing drug for the purpose of distribution and it was held that distribution of manufacturer for sale or distribution is one composite activity but here when the definition of dealer under the Unification Order has included the manufacturer of edible oil also, the manufacturer would become a dealer. No separate form is required for the purpose of manufacturer/producer and as such no vacuum is there. 14. No separate form is required for the purpose of manufacturer/producer and as such no vacuum is there. 14. On the second point, by referring to Clause 30 of the Unification Order, it has been submitted that for Oil Mills, power of entries, search and seizure have been given to an officer not below the rank of the Executive Magistrate but here it is stated that the Supply Officer has made search and seizure but in paragraph 9 of the writ petition, it has been specifically stated that in course of raid other high officers had also accompanied the informant. Amongst those high officers, the Executive Magistrate may also be included and the same has not been clarified either in the writ petition or at the time of argument by the learned Counsel for the petitioners. In that view of the matter, it cannot be said that the seizure is illegal. Moreover, it has been held in a recent judgment of the Apex Court wherein illegality in the seizure may not make the prosecution bad for the purpose of quashing at the initial stage. In that view of the matter, the prosecution against the petitioners on this point cannot be said to be bad or an abuse of the process of the court. 15. In the result, this writ petition has got no force and hence the same is dismissed.