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2012 DIGILAW 509 (AP)

Karnati Nageswara Rao, Guntur District v. Dist. Collector, (Cs) Guntur

2012-06-12

V.ESWARAIAH, VILAS V.AFZULPURKAR

body2012
Judgment :- Unsuccessful writ petitioner has filed this writ appeal against the order of learned single Judge dated 24.4.2012 dismissing WP No. 23116 of 2010. The writ petition was filed questioning the orders of District Collector (CS), Guntur and Joint Collector, Guntur (respondents 1 and 2 respectively) confirming the order of 3rd respondent-Revenue Divisional Officer, Guntur by which the authorization of Fair Price Shop dealer-appellant was cancelled. The appellant was the Fair Price Shop dealer appointed in 2000 at Yarrabalem village of Mangalagiri Mandal, Guntur district. On 2.5.2003 Civil Supplies Deputy Tahsildar, Mangalagiri visited the fair price shop of appellant and verified the stocks of Food for Work Rice (FFW Rice) with reference to sales and stock registers and ground balance and found shortage of 172.05 quintals. It is stated that as per the stock register, the available stock was 247.80 quintals, but on ground it was only 15.75 quintals and thus there was a shortage of 172.50 quintals of FFW rice. When questioned about the said shortage, the appellant stated that he sold away the rice in black market due to financial crisis and for his family needs. The Civil Supplies Deputy Tahsildar conducted a panchanama, recorded statement of the appellant and seized 15.75 quintals of rice which was available and handed over the said stock to the nearby fair price shop dealer for safe custody. Basing on the said report, the fair price shop dealership of appellant was suspended by 3rd respondent by his proceedings in RC No. 1282/2003-G, dated 25.6.2003 which was served on the appellant on 2.7.2003. It appears that proceedings under Section 6-A of the Essential Commodities Act were initiated by the 2nd respondent and by his order dated 17.1.2005 he directed the Tahsildar, Mangalagiri to collect the value of Rs.2,37,773.10 of the stocks diverted under Revenue Recovery Act from the appellant and remit the same to the Civil Supplies Head of Account. It appears that the proceedings under Section 6-A of the Essential Commodities Act have become final. A show cause notice dated 21.10.2009 was issued to the appellant as to why the authorization of fair price shop dealership should not be cancelled and directed him to submit his explanation on or before 31.10.2009. The following two charges were framed against the appellant, “Charge-I:During inspection of F.P. Shop by the CSDT, Mangalagiri on 02.05.2003, it was found that the FFW rice of Qtls.172.05 Kgs. The following two charges were framed against the appellant, “Charge-I:During inspection of F.P. Shop by the CSDT, Mangalagiri on 02.05.2003, it was found that the FFW rice of Qtls.172.05 Kgs. Short as detailed here under. Commodity Date of receipt As per Stock Register As per ground balance Variation FFW Rice 25.05.2002 106.20 FFW Rice 11 -06-2007 141 -60 personal gain by violating A.P. Control Orders 1973. Charge-II: There is variation between wtock registger and ground balance as shown under Charge-I. Hence, the dealer has not maintained records properly without a notice to misuse the FFW rice. Thus the dealer violated conditions of authorization.” The appellant submitted his explanation to the show cause notice stating that the FFW rice was given to a contractor at the instance of Engineer in good faith that he will handover the coupons after completion of road works, but the contractor did not handover the coupons to him even after completion of road work. He further stated that he sustained financial loss, suffered starvation and lost the fair price shop dealership and he admitted to pay the value of stocks in instalments, provided his fair price shop is restored. The appellant has not offered to examine the contractor or the engineer or the beneficiaries/card holders who received the FFW rice in support of his explanation. As the said explanation was not convincing, the 3rd respondent held that it is established that the appellant diverted 172.05 quintals of rice pertaining to FFW programme worth Rs.2,37,773.10 and misappropriated the Government money for his personal gain and hence the dealership of the appellant was cancelled by order dated 10.12.2009 and directed the Tahsildar, Mangalagiri to collect value of the stocks as per the orders of the 2nd respondent, dated 17.1.2005 passed under Section 6-A of the Essential Commodities Act. Aggrieved by the same, the appellant filed an appeal before the 2nd respondent. During the course of appeal, a copy of statement given by the appellant before the inspecting officer at the time of inspection i.e., on 2.5.2003 was produced which discloses that the appellant himself admitted before the inspecting officer that he sold away 172.05 quintals of FFW rice in open market due to certain family problems. The appellant never disputed the statement he had given before the inspecting officer on 2.5.2003. The appellant never disputed the statement he had given before the inspecting officer on 2.5.2003. The 2nd respondent by his order dated 3.3.2010 dismissed the appeal The appellant then filed a revision before the 1st respondent, who, by his order dated 23.8.2010 dismissed the revision in view of the fact that the appellant himself has admitted about the diversion of 172.05 quintals of food for work rice in a statement before the inspecting authority which was not disputed. Questioning the said orders, the appellant has filed a writ petition contending that the 3rd respondent did not conduct any enquiry and no card holder was examined to show that the appellant has diverted the stocks and that no opportunity of producing contractor/engineer and personal hearing was given to the appellant and that the basic document for cancellation of the fair price dealership of appellant is the report of 4th respondent which was not furnished to him. The learned single Judge dismissed the writ petition rejecting all the contentions and distinguished the various judgments cited by the appellant. With regard to the contention of the appellant that no opportunity was given to him to examine the contractor/engineer, the learned single Judge held that when once the appellant has asserted that he has supplied the rice to the contractor/engineer, it is for him to establish the said fact by either producing an appropriate receipt in acknowledgement thereof or by examining the contractor/engineer or the coolies who have received the food grains. Failure to establish his defence makes his position vulnerable and it amounts to failure of the dealer to account for the received quantities. Therefore, the explanation offered by the appellant was not found sustainable and held that the charges were proved. We have heard learned counsel for the appellant at length, learned Government Pleader for Civil Supplies appearing for respondents 1 to 4 and learned counsel appearing for respondent No.5. Learned counsel for appellant submits that under clause 5 (5) of the A.P. State Public Distribution System (Control) Order, 2008 the appointing authority has to make an enquiry and for reasons to be recorded in writing, suspend or cancel the authorisation issued to the fair price dealer. He submits that but in the instant case, no enquiry was conducted and no reasons were recorded and no opportunity of producing evidence or personal hearing was given to the appellant. He submits that but in the instant case, no enquiry was conducted and no reasons were recorded and no opportunity of producing evidence or personal hearing was given to the appellant. The appellant never disputed the inspection of his fair price shop by the Civil Supplies Deputy Tahasildar on 2.5.2003 and he never disputed the statement he had given to the inspecting officer in the presence of mediators. In the said statement he stated that he sold away 172.05 quintals of FFW rice stocks in open market due to certain family problems. However, in the explanation given to the show cause notice he maintained that he had handed over the stocks to a contractor at the instance of engineer, but the contractor failed to give him the coupons. But the appellant has failed to substantiate his defence by producing oral or documentary evidence. Therefore, in view of the admission of the appellant as to the diversion and undisputed facts, the 3rd respondent has cancelled the authorization holding the charges proved which was rightly confirmed by the respondents 1 and 2 as well as by the learned single Judge. Coming to the various judgments of this Court relied upon by the learned counsel for the appellant, in Ambati Srinivasulu Vs. District Collector, Nellore and others ( 2006 (1) ALT 273 (DB) it was a case where the charge on which the order of cancellation was passed was not indicated in the show cause notice and the cancellation was made on the charges other than mentioned in the show cause notice and therefore it was interfered with by this Court. In M. Kalyani Vs. District Collector, Prakasam District, Ongole and others (2006 (5) ALD 796 (DB) it was a case where a show cause notice was issued to the dealer and order of cancellation was passed on the basis of a report which was not supplied to the dealer. It is noted that the charges leveled in that case related to not distributing essential commodities properly and not obtaining D.Ds. within the time for selling commodities. In the present case, however the inspection report merely recorded shortage of stock as per stock register which the petitioner has accepted and as such even if the report of the Civil Supplies Deputy Tahasildar was not supplied, it will not cause any prejudice to the appellant. In M. Sadasiva Sekhar Vs. within the time for selling commodities. In the present case, however the inspection report merely recorded shortage of stock as per stock register which the petitioner has accepted and as such even if the report of the Civil Supplies Deputy Tahasildar was not supplied, it will not cause any prejudice to the appellant. In M. Sadasiva Sekhar Vs. District Collector, Kurnool and others ( 2003 (3) ALT 68 ) a show case notice issued to the dealer did not give the details of card holders who received less quantities of essential commodities. In that context, this Court had observed that opportunity of personal hearing was necessary. Such a situation is not attracted in the present case. In Katamreddi Vasundhara Vs. Joint Collector, Ananthapur and others ( 2008 (4) ALT 475 ) though five charges were framed against the dealer, the order of cancellation merely recorded that the charges framed against the dealer are serious in nature and it was not just and proper to allow the dealer to run the fair price shop. In that context, it was held that the order of cancellation was bereft of reasons and was interfered with. Lastly, in K. Bharath Vs. Collector (Civil Supplies), Chittoor and others ( 2011 (1) ALT 655 ) the authorization was cancelled on the ground that the dealer was not a permanent dealer and was only a temporary dealer and restoration of fair price shop dealership to a temporary dealer was not proper. It was held that the cancellation was required to be made for violation of control orders and therefore, the cancellation was set aside on the ground that it was made without giving any findings on the charges. In the instant case, the fair price shop dealership was suspended on 25.6.2003 and proceedings under Section 6-A of the Essential Commodities Act were conducted and the Joint Collector passed an order dated 17.1.2005 under Section 6-A of the Essential Commodities Act directing the Tahsildar, Mangalagiri to collect the value of the stocks diverted, which order has become final. After cancellation of the authorization, in fact the fair price shop dealership was notified and respondent No.5 was appointed as permanent dealer vide proceedings dated 9.9.2010 which was not challenged by the appellant. It is evident from the facts of this case that there is an allegation of shortage of stocks against the dealer. After cancellation of the authorization, in fact the fair price shop dealership was notified and respondent No.5 was appointed as permanent dealer vide proceedings dated 9.9.2010 which was not challenged by the appellant. It is evident from the facts of this case that there is an allegation of shortage of stocks against the dealer. When such an allegation is made, the dealer has to either produce evidence of supply of essential commodities in accordance with control orders or otherwise explain as to why such a shortage occurred in stocks. In the present case, though initially the appellant admitted to have sold the stocks in black market on account of financial constraints as per the statement given by him at the time of inspection, but later gave a different explanation to the show cause notice and resiled from that statement and stated that he has supplied rice to the contractor on the instructions of engineer, but failed to produce any coupons. Thus the claim of the appellant that he has supplied rice to the contractor on the instructions of engineer was a matter entirely for him to establish, but he has failed to prove the same by producing any oral or documentary evidence. As is held in the decisions cited above, the burden of proof is not static and when the shortage of stocks is noticed, the burden shifts to the dealer to establish how the said shortage occurred under the control orders. In the absence of discharge of the said burden, all the authorities below were justified in reaching to a conclusion that the appellant was liable for the charges framed against him, as such the order of cancellation is sustainable. We, therefore, see no reason to interfere with the orders of the authorities below as well as that of the learned single Judge. The writ appeal is accordingly dismissed along with miscellaneous petitions, if any. However, no order as to costs.