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2003 DIGILAW 269 (AP)

Iskala Venkata Naraslmham v. Commissioner of Civil Supplies (Appeals), Hyderabad

2003-02-19

V.V.S.RAO

body2003
V. V. S. RAO, J. ( 1 ) THE petitioner is a retailer carrying on the business in pulses with a valid licence under the A. P. Scheduled Commodities Dealers (Licensing and Distribution) Order, 1982 (hereafter called the Control Order ). On 14-8-1999, the Inspector of Police (Vigilance cell), Civil Supplies Department, the third respondent herein, intercepted a bullock cart carrying seven bags of Black Gram Dal which was being carried by one Peruri brahmaiah. Raising suspicion about the purchase as per the bill, the third respondent surprised the shop of the petitioner on the same day and found that account books were not maintained properly upto date. He seized 27. 90 qtls. of Black Gram Dal and 112 qtls. of Black Gram and submitted a report to the second respondent. After issuing a show-cause notice dated 20-3-1990, the second respondent passed an order on 29-1-1992 ordering confiscation of 50% of the seized stock and imposed a fine of Rs. 500. 00 on the owner of the bullock cart. The petitioner s appeal before the first respondent under Section 6-C of the essential Commodities Act, 1955 ( the Act ) was also dismissed vide order in G. O. Ms. No. 514, Food, Civil Supplies and Consumer affairs (CS. IV) Department, dated 6-9-1996. Assailing the order of the first respondent, the writ petition is filed. ( 2 ) LEARNED counsel for the petitioner submits that in view of the mitigating circumstances namely that there is no price control or movement control on Black Gram or Black Gram Dal and that there is no allegation or proof of the petitioner involving in clandestine business, the first respondent, for alleged contravention, which is trivial and technical nature could not have passed an order confiscating 50% of the seized stock. These contentions are refuted by the learned Govt. Pleader for civil Supplies. ( 3 ) THE submission that whenever there is no price control or movement control on essential commodities and whenever there are no allegations of clandestine business, action under Section 6-A of the Act cannot be taken, is misconceived. Under Sec. 6-A of the Act, where any essential commodity is seized pursuant to an order under Clause 3 of the Control Order, the District Collector may direct the essential commodity seized be confiscated to the Government. Under Sec. 6-A of the Act, where any essential commodity is seized pursuant to an order under Clause 3 of the Control Order, the District Collector may direct the essential commodity seized be confiscated to the Government. Section 6-A is attracted to every case where a Control Order made by the State government under Section 3 of the Act is violated. The order of confiscation is without prejudice to prosecution instituted for contravention of such order. The power of the Collector under Section 6-A does not, in any manner, get diluted as and when essential commodity seized is such where there is no price control or movement control. The same is the case where the allegations are not with reference to clandestine business. ( 4 ) IT must, however, be held that when the contraventions or violations of the control Order or conditions of licence are of trivial and technical nature, the authorities cannot pass an order without due application of mind. That there is no allegation of clandestine business and that there is no price control and movement control on the essential commodity seized are two important mitigating circumstances which would certainly tilt the balance in favour of the licensee under the Control order. In such an event, the law expects the collector, under Section 6-A, as well as the appellate authority under Section 6-C of the act, to exercise sound discretion, for an order of confiscation has serious consequences both on the licensee and in some circumstances on the public at large. A reference may be made to the decisions of this Court in P. Purushotham v. State of A. P. 1 and N. Panduranga Rao v. State of A. P. 2 wherein this Court considered this aspect of the matter and laid down that for violations or contraventions of technical and trivial nature, an order of confiscation of the entire stock or an order of confiscation of substantial stock would not be justified. ( 5 ) THERE are many Control Orders which require the licensee to display stock board and price board on day-to-day basis. There ate also Control Orders which require all the licensees to maintain account books and stock registers reflecting the true state of affairs. ( 5 ) THERE are many Control Orders which require the licensee to display stock board and price board on day-to-day basis. There ate also Control Orders which require all the licensees to maintain account books and stock registers reflecting the true state of affairs. No doubt, the law requires strict compliance with all the requirements, but the same, however, does not mean that if substantially the conditions of the licence or the provisions of the Control Order are complied with, an order of confiscation should be passed for violation, especially when there is no allegation of clandestine business. ( 6 ) THE Control Order requires every person carrying on the business as a dealer in essential commodities to maintain accounts and display the quantities and prices of scheduled commodities available with him as mentioned in Schedule I. The licence is issued subject to conditions mentioned therein. Condition No. 3 requires every licensee to maintain a register of daily accounts of each commodity showing correctly the opening stock on the beginning of the day, quantities received during the day, quantities delivered during the day and the closing stock. The licensee is also required to complete his accounts for each day on the day to which they relate. The control Order nowhere relaxes the conditions in relation to the licensees of scheduled commodities which are not subjected to movement control or price control. Therefore, the submission of the learned counsel for the petitioner cannot be accepted. However, as noticed, there are strong mitigating circumstances while exercising discretion under Section 6-A of the Act. ( 7 ) AFTER receiving report from the inspector of Vigilance, show-cause notice was issued to the petitioner on 20-3-1990. In the show-cause notice it was alleged that the petitioner was doing clandestine business by issuing false bills with the help of his staff and that he was not maintaining proper stocks and sale account books and thereby contravened Condition No. 3 (l) (v) of the conditions of licence read with Sections 7 and 8 of the Act. After considering the explanation, an order of confiscation dated 29-1-1992 was passed. But there is no finding that the petitioner resorted to clandestine business except saying that the bill seized from Peruri Brahmaiah on 14-8-1999 did not indicate the particulars of purchase and licence number. After considering the explanation, an order of confiscation dated 29-1-1992 was passed. But there is no finding that the petitioner resorted to clandestine business except saying that the bill seized from Peruri Brahmaiah on 14-8-1999 did not indicate the particulars of purchase and licence number. It is not the case of the department that seven bags of Black Gram dal were not accounted for. The allegation was that records were not maintained up to date. Be it noted that the third respondent probably might have visited the shop of the petitioner between 10. 00 and 11. 00 a. m. and, therefore, in the beginning of the day, it would not have been possible for him to update his accounts. The contravention alleged is trivial and that it is not of technical nature. Therefore, confiscation of the stock which comes to about Rs. 60,000. 00 is too harsh and confiscation of 25% of the stock seized is justified in the facts and circumstances of the case. ( 8 ) IN the result, while upholding the order passed by the appellate authority, the order of confiscation is modified to the effect that there shall be confiscation of 25% of the seized stock. The writ petition is accordingly disposed of. There shall be no order as to costs.