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2022 DIGILAW 824 (PAT)

Ganpati Traders v. State of Bihar

2022-09-28

RAJEEV RANJAN PRASAD

body2022
RAJEEV RANJAN PRASAD, J.:–This writ application has been preferred seeking the following reliefs:— “(a) For issuance of writ in the nature of mandamus directing and commanding upon the respondent authorities to release 115 bags of wheat (67.55 quintal) that has been kept in Godown of Petitioner which has been seized by the Block Supply Officer, Rajapakar along with the Officials of Rajapakar Police Station and for which Rajapakar P.S. Case No.192/2022 dated 10.06.2022 has been registered under Section 7 of the Essential Commodities Act. (b) For issuance of writ in the nature of Mandamus directing and commanding the Respondent authorities to release 115 bagas of wheat (67.55 quintal) that had that has been kept in Godown of Petitioner which has been seized by the Block Supply Officer, Rajapakar along with the Officials of Rajapakar Police Station and for which Rajapakar P.S. Case No.192/2022 dated 10.06.2022 has been registered under Section 7 of the Essential Commodities Act. (c) For holding that the seized wheat is not government food grains and same has been purchased by the Petitioner from different farmers, Millers/traders in usual course of business for selling to outside state after payment of cost. (d) For any other writ/writs, order/orders, directions in the teeth of the facts and circumstances of this case.” Case as per FIR 2. It is stated that on the basis of the written report of the Block Supply Officer, Rajapakar (Vaishali) that in ward no.13, south Rajapakar panchayat of Rajapakar Block subsidized wheat has been stored for black-marketing, a raid was conducted in the premises of the petitioner. It is alleged that in course of said raid 115 bags of subsidized wheat has been found stored in jute bags of Bihar State Food and Civil Supplies Corporation (hereinafter referred to as ‘the Corporation’). It is further alleged that at the time of raid proprietor of the shop was present and on being enquired the proprietor disclosed that the wheat were purchased from farmers in the rural areas. He could not produce any paper in proof of the same despite waiting for about two hours. The informant claims that from these facts it appears that the wheat were the subsidized wheat of the Corporation which were stored for black-marketing purposes. The wheat were seized and the same were given on ‘Jimenama’ to the Assistant Godown Manager of Bihar State Food Corporation. The informant claims that from these facts it appears that the wheat were the subsidized wheat of the Corporation which were stored for black-marketing purposes. The wheat were seized and the same were given on ‘Jimenama’ to the Assistant Godown Manager of Bihar State Food Corporation. On the basis of the written complaint of the Block Supply Officer, Rajapakar the present case being Rajapakar P.S. Case No.192 of 2022 dated 10.06.2022 has been registered under Section 7 of the Essential Commodities Act, 1955. Case of the petitioner 3. The petitioner is a proprietorship concern involved in the business of selling and buying rice, wheat and other items. According to him, the wheat in question were purchased from three different farmers namely (i) Kundan Kumar (ii) Raju Kumar and (iii) Ajeet Kumar. Three invoices in this regard have been brought on record as Annexure-P/2 series to the writ application. The petitioner has also brought on record its GST registration certificate as Annexure-P/3 to the writ application claiming that it is registered under the Value Added Tax Act, 2005 and also with the Government of India vide GST registration. From Annexure-P/3 it appears that it has been issued on 02.11.2017 It is submitted that the allegation that the wheat were the subsidized wheat of the Corporation has no basis and the whole allegation is based on surmises and conjectures. Merely because the wheat were packed in the bags of the Corporation, it does not make that those were subsidized wheat. It is common knowledge that those bags are available in the open market and anybody can purchase it. 4. It is submitted that the rice/paddy had been removed from the ambit of Section 3 of the Essential Commodities Act, 1955 (hereinafter referred to as ‘the E.C. Act’) by the Central Government vide Removal of (Licensing Requirements, Stock Limits and Movement Restrictions) on Specified Foodstuffs Order 2002. The said order was notified vide GSR 104(E) dated 15.02.2002 and was published in the Gazette of India, Extraordinary, Part-II dated 15.02.2002, any person who is engaged in purchase, sale, supply, distribution and storage can do so freely. There is no restriction on acquiring any quantity of paddy/rice from open market. 5. Mr. Mrigank Mauli, learned senior counsel assisted by Mr. Prince Kumar Mishra, learned advocate, has placed the aforementioned case of the petitioner. There is no restriction on acquiring any quantity of paddy/rice from open market. 5. Mr. Mrigank Mauli, learned senior counsel assisted by Mr. Prince Kumar Mishra, learned advocate, has placed the aforementioned case of the petitioner. It is submitted that in fact on perusal of the FIR it would appear that it does not allege violation of any order issued under the E.C. Act. It is submitted that the informant is herself not sure that the wheat were that of the Corporation. She has only drawn an inference from the fact that on query the proprietor could not make available the papers showing purchase of wheat despite waiting for about two hours. It is submitted that till date there is no prima-facie material to show that the wheat in question belongs to Corporation. The Invoices enclosed as Annexure ‘P/2’ are not disputed in the counter affidavit. 6. According to learned senior counsel the only remedy for the petitioner is to move this Court under Article 226 of the Constitution of India for a direction to the District Magistrate, Hajipur at Vaishali (respondent no.2) and the Sub-Divisional Officer, Mahnar (respondent no.3) to release wheat in favour of the petitioner on such terms and conditions as may be deemed just and proper by this Court. Reliance has been placed upon the judgement of the Hon’ble Supreme Court in the case of Sunderbhai Ambalal Desai Vs. The State of Gujarat reported in (2002) 10 SCC 283 to submit that the ratio of the said judgement would equally apply in the facts of the present case. 7. Referring to the judgement of the Hon’ble Full Bench of this Court in the case of Baleshwar Roy and Anr. Vs. The State of Bihar reported in 2018(4) PLJR 970 , learned senior counsel for the petitioner submits that in the said case the Hon’ble Full Bench has categorically held in paragraph ‘62’ that the power of this Court under Article 226 of the Constitution of India cannot be curtailed in any circumstance and no statutory bar can affect the power of the High Court, therefore in a case where gross injustice is likely to be caused to the petitioner, intervention of this Court under Article 226 of the Constitution of India would be the only way to render justice. 8. The learned senior counsel has lastly argued that in the case of M/S Anisha Traders Vs. 8. The learned senior counsel has lastly argued that in the case of M/S Anisha Traders Vs. The State of Bihar & Ors. being Cr.WJC No.697 of 2022, this Court had directed for release of the wheat, therefore a similar order may be passed in the present case. Submission of the State 9. On the other hand, Mr. Uday Pratap Singh, learned AC to SC-4 appearing for the respondent nos. 2 to 4 has opposed this application. A counter affidavit has been filed by the Block Supply Officer. It is stated in the counter affidavit that vide letter no.407 dated 20.06.2022 (Annexure-B) the Sub-Divisional Officer, Mahua communicated the Collector, Vaishali with the details of seized food grains and requested him to confiscate the same under Section 6-A of the Act of 1955. In paragraph ‘10’ of the counter affidavit it is stated that a confiscation case has already been initiated with respect to the seized subsidized wheat vide Essential Commodities Act Case No.06/2022-23 and vide order contained in memo no.481 dated 13.07.2022 a show cause notice has been issued to the petitioner. In paragraph ‘11’ of the counter affidavit, it is stated that in a similar matter, a learned coordinate Bench of this Court has in CWJC No.4479 of 2020 (Md. Jahangir Vs. The State of Bihar and others) held that in view of the ratio laid down by the Hon’ble Supreme Court in the case of Shambhu Dayal Agarwala Vs. State of West Bengal & Anr. reported in (1990) 3 SCC 549 and the judgement of the Hon’ble Full Bench in the case of Baleshwar Roy (supra) no case for issuance of mandamus for release of the wheat would be made out. Consideration 10. Having heard learned senior counsel for the petitioner and learned counsel for the State, this Court finds that the plenary power of this Court under Article 226 of the Constitution of India may be exercised to pass an appropriate order in the cases where there is a violation of principles of natural justice or in a case where gross injustice has been caused to the petitioner or is likely to be caused to the petitioner. Thus, what is to be looked into is as to whether in the facts of the present case, this Court should exercise its discretion under Article 226 of the Constitution of India to direct the respondent nos.2 and 3 to release wheat in favour of the petitioner during the pendency of the confiscation proceeding. 11. In the facts of the present case, this Court finds that a confiscation proceeding has been initiated against the wheat in question. On perusal of the records, the facts situation of the present case and the submissions made on behalf of the petitioner are found to be quite different and distinct from that of the facts of Md. Jahangir (supra). In this case the wheat in question has been seized in the godown of the petitioner alleging that because the petitioner could not produce the paper of the sale and purchase of wheat within two hours, hence it shows that the wheat is a government subsidized wheat. 12. The FIR of the Block Supply Officer is based on an inference drawn by her. Thereafter, within one day she wrote a letter bearing no.56 dated 11.06.2022 to the Sub-Divisional Officer, Mahua by which she informed about the seizure of the wheat in question and necessity to confiscate the same and sale in the market to save it from getting damaged. From her letter dated 11.06.2022 (Annexure-A) it nowhere appears that she had been in possession of any sort of material to prima-facie take a view that the wheat are government subsidized wheat. Before making a report suggesting confiscation she did not wait for investigation to take place. No opportunity was offered to the petitioner to produce the papers showing purchase of wheat. Immediately after receiving the letter of the Block Supply Officer, the Sub-Divisional Officer, Mahua proceeded to write a letter bearing no.407 dated 20.06.2022 to the Collector, Vaishali in which he referred the recommendation of the Block Supply Officer and forwarded the same to the Collector, Vaishali with his own recommendation to take action under Section 6-A of the Act of 1955. Again this Court finds that the Sub-Divisional Officer, Mahua has only acted as a post office. He has not discussed any material or applied his judicious mind before making recommendation to the Collector. 13. Again this Court finds that the Sub-Divisional Officer, Mahua has only acted as a post office. He has not discussed any material or applied his judicious mind before making recommendation to the Collector. 13. Thereafter, the Additional District Magistrate, Vaishali proceeded to pass order dated 13.07.2022 wherein he has reproduced the recommendations of the Block Supply Officer and the Sub-Divisional Officer. The Additional District Magistrate, Vaishali has passed order giving consent for initiation of an action under Section 6-A of the Act of 1955 and directed for issuance of show cause notice as to why an appropriate action be not taken against the petitioner for black-marketing of the government subsidized articles. By the same stroke of pen, he directed for sale of wheat and deposit of the amount in the government treasury. 14. On an analysis of the action right from the stage of letters written by the Block Supply Officer till passing of the order by the Additional District Magistrate, Vaishali it would appear that all these authorities had proceeded to assume upon themselves that these are the wheat which are government subsidized wheat. They had no patience to wait for the result of the investigation of the case lodged on 10.06.2022 even for a reasonable period during which the I.O. could have collected certain materials. The investigating agency could have in such matters after collecting evidences within a reasonable period taken a view as to whether there are sufficient materials to show that the wheat are government subsidized wheat. So far as Section 6-A of the E.C. Act is concerned, it talks of confiscation of foodgrains, edible oilseeds, edible oils, etc. The investigating agency could have in such matters after collecting evidences within a reasonable period taken a view as to whether there are sufficient materials to show that the wheat are government subsidized wheat. So far as Section 6-A of the E.C. Act is concerned, it talks of confiscation of foodgrains, edible oilseeds, edible oils, etc. Section 6-A of the Act of 1955 reads as under:— “[6A.Confiscation of foodgrains, edible oilseeds, edible oils, etc.—(1)Where any essential commodity is seized in pursuance of an order made under section 3 in relation thereto, it shall be reported without any unreasonable delay to the Collector of the district in which such essential commodity is seized and the Collector may, if he thinks it expedient so to do, inspect or cause to be inspected such essential commodity, whether or not the prosecution is instituted for the contravention of the order, may order confiscation of - (a) the essential commodity so seized; (b) any package, covering or receptacle in which such essential commodity is found; and (c) any animal, vehicle, vessel or other conveyance used in carrying such essential commodity: Provided that, without prejudice to any action which may be taken under any other provision of this Act, no foodgrains or edible oilseeds in pursuance of an order made under section 3 in relation thereto from a producer shall, if the seized foodgrains or edible oilseeds have been produced by him, be confiscated under this section: (2) Where the Collector, on receiving a report of seizure or on inspection of any essential commodity under sub-section(1), is of the opinion that the essential commodity is subject to speedy and natural decay or it is otherwise expedient in the public interest so to do, he may order the same to be sold at the controlled price, if any, fixed under any law for the time being in force; (3) In the case of foodgrains, where there is no controlled price, the Collector, if he thinks fit, may order the foodgrains seized under sub-section (1) to be sold through fair price shops at the price fixed by the Central Government or the State Government, as the case may be for the sale of such foodgrains to the public through these shops or may order such foodgrains by public auction. (4) The Collector shall whenever it is practicable so to do having regard to the nature of the essential commodity take and preserve sample of the same in the prescribed manner before its sale or distribution. (5)Where any essential commodity is sold as aforesaid, the sale proceeds thereof, after deduction of all expenses of the sale or auction, as the case may be, shall— (a) where no order of confiscation is ultimately passed by the Collector; or (b) where an order passed on appeal under sub-clause (1) of Section 6-C so requires; or (c) in the case of prosecution being instituted for the contravention of the order in respect of which an order of confiscation has been made under this section and where the person concerned is acquitted to paid to the owner thereof or the person from whom it is seized: Provided that in the case of foodgrains sold through fair price shops in accordance with sub-sections (2) and (3) the owner shall be paid for the foodgrains so sold, the price fixed by the State Government, for retail sale of such foodgrains through such shops less all expenses of sale or auction under sub-sections (2) and (3). (6) Notwithstanding anything to the contrary contained in the Code of Criminal Procedure, 1973 (2 of 1974), when Collector or the appellate authority is seized with the matter under this section no court shall entertain any application in respect of essential commodities, any package covering, receptacle, any animal, vehicle or other conveyance used in carrying such commodities as far as its release, distribution etc. is concerned and the jurisdiction of Collector or the appellate authority with regard to the disposal of the same shall be exclusive. (7) The State Government may by notification in the Official Gazette, authorise any officer not below the rank of Sub-Divisional Magistrate, to discharge all or any of the functions of a Collector under this section. (8) The Collector shall for the purposes of this Act have the same powers as are vested in a Court under the Code of Civil Procedure, 1908 when making enquiries under this section in respect of following matters, namely:— (a) receiving evidence on affidavits; (b) summoning and enforcing the attendance of any person and examining him on oath; and (c) compelling the production of documents. (9) All enquiries and proceedings under this section before the Collector and the appellate authority shall be deemed to be judicial proceeding and while discharging functions under this section the Collector and the appellate authority shall be deemed to be a Court.” (underline is mine) 15. In the present case, it is the submission of learned senior counsel for the petitioner that wheat has been removed from the ambit of Section 3 of the E.C. Act by the Central Government vide Removal of (Licensing Requirements, Stock Limits and Movement Restrictions) on Specified Foodstuffs Order 2002. The police case has been registered under Section 7 of the E.C. Act. It will, thus be a question to be considered by the authority passing an order under Section 6-A of the E.C. Act as to whether the present case would be covered under Section 6-A and it has been seized pursuant to an order made under Section 3 of the E.C. Act. Section 6-A talks of an inspection of such essential commodity where he thinks it expedient so to do. 16. To this Court, therefore it appears that at the stage of initiation of a confiscation proceeding the Collector must satisfy himself with prima-facie materials as to whether the seizure is of an essential commodity and it is in accordance with law. Nothing of that sort appears from the order passed by the Additional District Magistrate, Vaishali. 17. To this Court, thus, it appears that it is one of those cases in which a mere allegation in the FIR is being made basis for initiation of a confiscation proceeding. No doubt confiscation proceeding is in the nature of a civil proceeding but it has got a civil consequence, hence principles of fair play in action embodied under the principles of natural justice would be attracted. Even otherwise any action of a pubic authority must satisfy the twin principles of our Constitution i.e. reasons and relevance. The fair play in action is fundamental to any action of a public authority/statutory authority. 18. Similarly, before passing an ex-parte order for sale of the seized articles under Section 6-A(2) the Collector is required to take a view that the commodity is subject to speedy and natural decay or it is expedient in public interest to do so. In this case the wheat are packed in jute bags and are kept in the godown of the petitioner. In this case the wheat are packed in jute bags and are kept in the godown of the petitioner. No reason has been provided in the order as to why immediate sale of the wheat is necessary. Why it cannot wait for a reasonable period for the report of the investigating agency. This Court further finds that no order under sub-section (4) of Section 6-A of the E.C. Act has been passed to take and preserve sample of the wheat in the prescribed manner before it’s sale. Thus, the order for sale seems to have been passed in complete haste giving complete go-bye to the provision of sub-section (4) of Section 6-A of the E.C. Act. 19. In the case of Baleshwar Roy (supra), the Hon’ble Full Bench has held in paragraph ‘62’ that the powers of the High Court under Article 226 and 227 of the Constitution of India cannot be curtailed under any circumstance, as the power flows from the Constitution itself and no statutory bar can affect this power. Therefore, an order of release may be passed under Article 226 of the Constitution, even pending confiscation proceedings, but only when it is established before the Court that the procedures prescribed and the law in that regard has been completely flouted and that there is complete violation of the procedure prescribed for confiscation. 20. In the facts of the present case, this Court finds that the confiscation proceeding has been initiated in haste and without there being any prima-facie materials available before the confiscating authority to pass an order under Section 6-A of the E.C. Act. Same is the position with regard to order for sale. 21. At the time of hearing of this case, learned counsel for the State was not even in a position to inform as to whether the investigating agency had collected any material to suggest prima-facie that the seized wheat are the government subsidized wheat. 22. Same is the position with regard to order for sale. 21. At the time of hearing of this case, learned counsel for the State was not even in a position to inform as to whether the investigating agency had collected any material to suggest prima-facie that the seized wheat are the government subsidized wheat. 22. Situated thus, Court is of the considered opinion that the Block Supply Officer may have the powers to conduct raid on getting information as to black-marketing of the essential commodities, he/she may go on conducting the raids and lodge FIR but at the same time in the nature of the allegations in the present case before recommending for confiscation of the foodgrains he/she must have certain positive materials in hand collected in course of investigation to take a view that those are the government subsidized wheat which are liable to be confiscated. He/she is the allegationist in the FIR and has to testify in course of trial, his/her allegations in the FIR alone cannot form basis for initiation of a confiscation proceeding. The authority passing the order under Section 6-A of the E.C. Act is required to satisfy itself with the prima-facie materials before passing an order initiating action under the said provision otherwise it may cause gross injustice to a person like the present petitioner in this case. 23. In the case of Md. Jahangir (supra) the learned Coordinate Bench refused to exercise it’s discretion in the given facts of the said case. The relevant part of the order is being reproduced hereunder:— “In the instant case, the petitioner has failed to demonstrate that the procedure prescribed in law has been flouted in the search and seizure of the wheat bags or that no notice was issued to him in the confiscation proceeding or that any substantial injustice has been caused to him or that any exceptional case is made out for the release of wheat bags during pendency of the confiscation proceeding.” 24. Apparently, the facts of the present case are quite different and distinct. 25. Further, this Court would take note of the stand of the State in a similar matter of M/S Anisha Traders disposed of by this Court on 07.07.2022. Apparently, the facts of the present case are quite different and distinct. 25. Further, this Court would take note of the stand of the State in a similar matter of M/S Anisha Traders disposed of by this Court on 07.07.2022. In the said case the learned Standing Counsel (AC to SC-4) representing the State took a stand that since the petitioner is ready to provide adequate security/surety and to abide by reasonable terms and conditions, he would not object if this Court directs the District Magistrate, Vaishali to release the foodgrains subject to providing adequate security/surety. In all fairness, the case of the petitioner is required to be considered maintaining uniformity in justice. 26. In result, this writ application is allowed. 27. The respondent nos.2 and 3 are directed to release the foodgrains in favour of the petitioner subject to the conditions that the petitioner shall make available adequate and sufficient security/surety (not in cash or bank guarantee), subject to the satisfaction of the District Magistrate, Vaishali to the extent of the value of the foodgrains which may be assessed within one week from today. The petitioner shall further furnish an undertaking to abide by any other reasonable condition(s) which may be imposed for purpose of future proceedings. 28. The petitioner shall undertake that if the foodgrains are released in his favour, in course of trial or confiscation proceeding as the case may be he shall not raise any question with respect to the seizure of the foodgrains and no identification issue shall be raised in course of the proceeding/trial. Further the photographs of the jute bags containing the rice which may be exhibited in course of trial and the samples of the seized foodgrains if obtained in accordance with law by the authority concerned shall not be questioned by the petitioner and he will not claim any benefit only because this Court has ordered for release of the foodgrains in his favour. 29. It will be open for the Block Supply Officer, the Sub-Divisional Officer and the District Magistrate concerned to take a fresh view of the matter based on the materials which may have been collected in course of investigation and pass a fresh order, if so advised, under Section 6-A of the E.C. Act after affording adequate opportunity of hearing to the petitioner. 30. This writ application stands disposed of accordingly.