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2001 DIGILAW 561 (KAR)

H. S. Manjunath v. State of Karnataka

2001-07-19

R.GURURAJAN

body2001
ORDER R. Gururajan, J.—The Petitioner is having a license in terms of the Essential Commodities licensing order of 1986. On 10.1.1995, the Deputy Director of Food and Civil Supplies visited the Petitioner's rice mill and noticed some deficiencies regarding stock and maintenance of books of accounts. A showcause notice came to be issued to the Petitioner with regard to confiscation in the matter. The Petitioner submitted his reply to the Respondents. Thereafter the 2nd Respondent passed an order at Annexure-'A'. Aggrieved by the order at Annexure-'A', the Petitioner filed an appeal to the 1st Respondent. The 1st Respondent, being satisfied with the case put forth by the Petitioner, set aside the order but ordered forfeiture of 10% of the total value by way of penalty to the extent of Rs. 1,35,170/-. This order is questioned before me. 2. Pursuant to my notice, the Respondents have entered appearance. 3. The matter is heard for final disposal with the consent of the parties. 4. The Counsel for the Petitioner essentially contends that the 1st Respondent cannot order recovery of a sum of Rs. 1,35,170/- by way of forfeiture or penalty in terms of Section 6(C) of the Essential Commodities Act, 1955. He says that there is want of jurisdiction in terms of Section 6(C). He relies on two Judgments of this Court reported in ILR 1975 Kar 2032 (Deputy Commissioner, Chitradurga and Anr. v. Gangaiah and Ors.) and order dated 28.6.1999 in Writ Petition No. 9882 of 1996. 5. Per contra, Smt. Shobha Patil contends that Section 6(C) provides for passing any order as it may think fit. She further elaborates that in terms of Section 6(C) any order including ordering forfeiture of a sum of Rs. 1,35,170/- can be made on the facts of this case. 6. After hearing the Counsel, let me see as to whether Section 6(C) provides for any such power. Section 6(C) reads as under: Appeal.-(1) Any person aggrieved by an order of confiscation under Section 6-A may, within one month from the date of the communication to him of such order, appeal to (the State Government concerned and the State Government) shall, after giving an opportunity to the appellant to be heard, pass such order as it may think fit, confirming, modifying or annulling the order appealed against. (2) Where an order under Section 6-A is modified or annulled by (the State Government) or where in a prosecution instituted for the contravention of the order in respect of which an order of confiscation has been made under Section 6-A, the person concerned is acquitted, and in either case it is not possible for any reason to (return the essential commodity seized) (such person shall, except as provided by Sub-section (3) of Section 6-A, be paid) the price therefore (as if the essential commodity) had been sold to the Government with reasonable interest calculated from the day of the seizure of (the essential commodity); and such price shall be determined- (i) in the case of foodgrains, edible oilseeds or edible oils, in accordance with the provisions of Sub-section (3-B) of Section 3; (ii) in the case of sugar, in accordance with the provisions of Sub-section (3-C) of Section 3; and (iii) in the case of any other essential commodity, in accordance with the provisions of Sub-section (3) of Section 3). A careful reading of the said provision would show that the appellate authority can pass such order as it may think fit confirming, modifying or annulling the order appealed against. In the case on hand, the appellate authority has set aside the order dated 13.4.2000. Having set aside, it is not open to him to levy 10% on the value of the rice and claim a sum of Rs. 1,35,170/- by way of either penalty or forfeiture in terms of Section 6(C). In some what identical circumstances, this Court, in the case of Deputy Commissioner Vs. Gangaiah and Ors. in ILR 1975 Kar 2032 in para 3 has ruled as under: Under Section 6-C of the Act an appeal is provided against such order of confiscation. The ambit of the power which a Sessions Judge can exercise while dealing with such an appeal is well defined by the words of that very Section; it provides that the judicial authority (Sessions Judge) can pass such order as it may think fit, confirming, modifying or annulling the order appealed against. It is therefore clear from the language of Section 6-C of the Act that no power to impose fine is conferred on the Sessions Judge as is done in the present case. It is therefore clear from the language of Section 6-C of the Act that no power to impose fine is conferred on the Sessions Judge as is done in the present case. The words such order as it may think fit occurring in Section 6C(1) of the Act, in my opinion, cannot be read or understood as giving a discretion to deal with and dispose of such appeals in one of the ways namely, confirming, modifying or annulling the order appealed against, and of course the discretion to be exercised should be judicial. To hold otherwise is to read into that section what is not warranted by its language. 7. In the subsequent Judgment in the case of B.M. Kadekoppa Vs. State of Karnataka in Writ Petition No. 9882 of 1996, dated 28.6.1999 this Court again ruled that the imposition of penalty in my opinion is wholly contrary to the provisions of Section 6-C of the Act. The provision makes it clear that the appellate authority, while disposing of the appeal, may either confirm, modify or annualise. Apart from this, the modifications did not authorise the appellate authority to either penalty or fine while allowing the appeal. In the light of these two Judgments, I am clear in my mind that the imposition of a fine/penalty by way of Rs. 1,35,170/- is beyond the powers conferred on the appellate authority in terms of Section 6-C. 8. The argument of the learned Government Pleader that the words 'as it may think fit' would include a levy of fine or penalty is an argument require to be rejected. The words 'as it may think fit' has to be understood in the context of the order either by way of confirmation, modification or annulling of the order. In fact, the very same contention was noticed in ILR 1975 Kar 2032 in para 4, in which this Court, after noticing these very words ruled that the words 'as it may think fit' occurring in Section 6-C appears to have been used only in that context i.e., after confirmation, modification or annulling the order and the law does not contemplate such imposition or fine. In the light of the clear language and in the light of the order of this Court, the contention of the Government has to be rejected. 9. In the result, this petition is allowed. In the light of the clear language and in the light of the order of this Court, the contention of the Government has to be rejected. 9. In the result, this petition is allowed. The impugned order in so far as it relates to imposition of forfeiture or fine of a sum of Rs. 1,35,170/- is set aside. Parties are to bear their respective costs.