judgement:
ition No. 84 of 1975.
Petition under article 32 of the Constitution of India.
A. k. Sell, D. N. Mukherjee, Narayan Gupta and C. section Chatterjee, for the petitioner.
Girish Chandra, for respondent No. 1.
D.P. Uniyal and O. P. Rana, for respondent nos.
The Judgment of the Court was delivered by FAZAL ALI, J.
By an order dated November 8, 1974 passed by the District Magistrate, Badaun, the petitioner was detained under section 3(1)(a)(iii) of the hereinafter referred to as 'the Act ' because the allegations made in the grounds of detention disclosed that he had committed acts prejudicial to the maintenance of supplies and services essential to the community.
The grounds of the order of detention were served on the petitioner by the District Magistrate, Badaun, on November 13, 1974.
The State Government approved the order of detention on 18 November 19, 1974 and made a report to the Government of India on November 22, 1974.
According to the respondents, the Government of U.P. had made a reference to the Advisory Board constituted under the Act on November 22, 1974 but as it had not received The representation from the petitioner, the same was forwarded later.
The representation, according to the respondents, was received on November 28, 1974 which was rejected on December 6, 1974.
The representation was sent to the Advisory Board on December 18" 1974 which gave 13 its report holding that the grounds were sufficient for detention of the petitioner and after receipt of the opinion of the Advisory Board on January 7, 1975 the order of detention was finally confirmed by the Government on January 17, 1975.
We might mention at the very outset that there was some controversy on two points before us.
In the first place the petitioner did not accept the stand of the Government that the reference to the Advisory Board was made on November 22, 1974 but relied on a counter affidavit filed by Mr. section K. D. Mathur, the then District Magistrate of Badaun, in this Court to support his plea that the reference to the Advisory Board was made on December 20, 1974 vide paragraph 2(vi) of the counter affidavit appearing at p. 118 the Paper Book.
It was therefore contended by the learned counsel for the petitioner that as the reference was made to the Advisory Board beyond the period mentioned in section 10 of the Act, there being a violation of the mandatory provision of the statute, the order of detention fell on this ground alone.
We gave an opportunity to the Government to produce before us materials to show the exact position and from the original file produced before us we find that the counter affidavit filed by Mr. section K. D. Mathur in this court to the effect that the reference was made to the Advisory Board on December 20, 1974 was factually incorrect and that the reference was really made on November 22, 1974 by the Government by virtue of letter No. 107/2/48/74.
The file also contains a letter of the Registrar dated January 7, 1975 forwarding the opinion of the Advisory Board wherein also it was mentioned that the reference was made on November 22, 1974.
In view of these cogent materials Mr. Sen learned counsel for the petitioner did not choose to press this point.
We cannot, however.
Leave this matter without expressing our strong disapprobation on the careless and irresponsible manner in which the counter affidavit has been filed by the respondents, particularly by Mr. section K. D. Mathur who happened to be the then District Magistrate, Badaun.
We hope the Government will be careful in future and see that such incorrect affidavit are not filed before this Court, which may create unnecessary confusion and controversy and make a simple issue so very much involved.
The petitioner was admittedly a partner of the firm called Bharat Oil Company which was dealing in the storage and sale of high speed diesel oil since 1965.
According to the petitioner the business was started at Badaun and Ujhani but later a branch was opened at Bareilly and the firm transferred its headquarters to Bareilly in 1971.
We are not, however, concerned with the business at 19 Bareilly in this case.
Under the , the petitioner could have carried on his business only after obtaining a licence from the prescribed authority.
The District Authorities could grant licence only to the extent of 22,000 liters but if the dealer wanted to store high diesel oil to the extent of more than 22,000 litres he had to get a licence from the Chief Controller of Explosives, Nagpur.
The petitioner 's further case is that as high speed diesel oil ran in short supply, the Indian oil Corporation and the District authorities impressed on the dealers the necessity of keeping light diesel oil which was available in sufficient quantities and was necessary for running, crushers and pumps in the rural areas.
The petitioner had undoubtedly secured a licence for storage of li ht diesel oil which was valid upto March 31, 1975 and had applied for renewal of the licence thereafter and had also complied with all the necessary formalities about no objection and the safety certificate to be given by the District Authorities.
But on the date in question the licence of the petitioner had not been renewed so far.
We might intention in this connection that the stand taken by the respondents is that although the petitioner had a licence to stole light diesel oil to the extent of 22,000 litres he did not possess any licence for storing it at Ujhani.
It appears that the godown of the petitioner was searched by the excise authorities on October 17, 1974 and November 5, 1974 and in inspection of the godown about 1.64 lakhs litres of light diesel oil was found stored it Ujhani.
The stock register was produced by the petitioner before the authorities which appeared to be in order and there is no allegation that there was any manipulation or interpolation in the stock register Thus the simple allegation against the petitioner is that he had stocked huge quantity of light diesel oil without waiting for the licence to be cleared by the Chief Controller of Explosives at Nagpur This forms the subject matter of the allegations mentioned in grounds (1)(a) & (b) of the grounds of detention served on the petitioner.
The sheet anchor of the argument of Mr. Sen learned counsel for the petitioner was that in so far as ground No (1) was concerned it was wholly irrelevant and totally unconnected with the nexus of the Act, because even if the grounds be taken at their face value they did not disrupt or disturb the essential supplies to the community.
Before dealing with this contention it may be necessary to quote in extenso the grounds mentioned in (1)(a) & (b) of the detention order: "(1) That you a partner in the firm named Bharat oil Company, Mohalla Ayodhya Nagar, Ujhani District Badaun, on Bareilly Mathura Road, authorised only to deal in High Speed Diesel and Motor Spirit were found hoarding Light Diesel oil, without having obtained a licence for the same from the Chief controller of Explosives, Nagpur as is evident from the following: (a) On 17 10 74 at about 4 P.M. the premises of your aforesaid firm was inspected by Sri section N. Pandey, District Excise officer, Badaun and it was found that in the underground tanks within the premises mentioned aforesaid 96,000 litres of Light 20 Diesel oil was stored, for which no licence could be produced on demand by the District Excise officer aforesaid and thereafter a complaint has also been lodged in the court of the Chief Judicial Magistrate, Badaun by the District Excise officer on 8 11 74 (b) On 5 11 74 the premises of your aforesaid firm Bharat oil Company, Ujhani, was again inspected at about 4.15 P.M. by Sri N. N. Verma S.D.M. Badaun accompanied by District Excise officer Badaun and Sri Fateh Singh, Dy.
S.P. Badaun and it was found that 68,000) litres of Light Diesel oil had during 7th October 1974 to the time of this inspection been added to the store kept by you of the said Light Diesel oil of 96,000 litres, in three underground tanks within the premises mentioned aforesaid and no licence could be produced on demand by the S.D.M. Badaun.
For this also, a complaint has been lodged by the S.D.M. Badaun in the Court of Judicial Magistrate II Badaun on 8 11 74.
" Analysing these grounds it would appear that there is no allegation by the detaining authority that by storing the huge quantity of light diesel oil the petitioner had in any way affected the distribution or sale of that commodity, nor is there any allegation to show that the petition had refused to sell light diesel oil to any body who required it.
The High Court which was moved in the first instance for a writ of habeas corpus, appears to have drawn an inference based purely on speculation that the petitioner had transferred huge quantities of light diesel oil from his depot at Badaun to his godown at Ujhani.
There is, however, no material on the basis of which the High Court could have drawn such an inference.
There is, however, no suggestion.
far less any allegation, in these grounds that the petitioner had tried to divert his stocks of light diesel oil from Badaun to Ujhani and thereby deprived the people of Badaun of their share of the light diesel oil.
In these circumstances, therefore, we arc satisfied that there is absolutely no correlation between the act of the petitioner and the disruption of distribution of the essential supplies to the community.
The learned counsel appearing for the respondents submitted that by storing such huge quantities of light diesel oil in Ujhani the petitioner has committed a clear violation of the mandatory provisions of the and the Rules made thereunder and must be presumed to have disrupted the essential supplies because light diesel oil had been declared by the order of the Government of U.P. to be an essential commodity.
We are, however, unable to agree with this argument.
Mr. Sen appearing for the petitioner does not dispute that the light diesel oil was an essential commodity, but his argument was that he has in no way tried to disrupt the essential supplies of this commodity and he merely committed a technical offence in storing the quantities of light diesel oil in anticipation of the licence which had been cleared by the District Authorities and which awaited the 21 sanction of the Chief Controller of Explosives, Nagpur and which would have in normal routine been granted.
It is also admitted in the ground itself that a complaint had been lodged in the Court of the Chief Judicial Magistrate against the petitioner for the storage.
We have already held in several cases that the commission of an offence at a private place or a violation of a provision of law by itself does not attract the Act unless by the act committed by the petitioner the essential supplies to the community are disrupted or even flow of the life of the community is disrupted.
Reading grounds (1)(a) & (b) we are unable to hold that they are in any way germane or relevant to the disruption of maintenance of essential supplies to the community.
In Manu Bhusan Roy Prodhan vs State of West Bengal and others(1) this Court observed as follows: "This kind of a solitary assault on one individual, which may well be equated with an ordinary murder which is not an uncommon occurrence, can hardly be said to disturb public peace or place public order in jeopardy, so as to bring the case within the purview of the Act.
It can only raise a law and order problem and no more; its impact on the society as a whole cannot be considered to be so extensive, widespread and forceful as to disturb the normal life of the community thereby rudely shaking the balanced tempo of the orderly life of the general public.
This ground is, therefore, not at all relevant for sustaining the order of detention for preventing the petitioner from acting in a manner prejudicial to the maintenance of public order.
The ratio of this case fully tallies with the facts of the present case where also grounds (1) (a) & (b) taken at their face value appear to be irrelevant and do not disclose any causal connection with the disruption of the essential supplies to the community.
We now take up the other ground, namely, ground No. (2), which is as follows: "(2) That you as partner of the firm M/s Bharat oil Company located at Badaun licensed at Badaun to deal with Light Diesel oil and required by rule 9(1) of the U.P. Essential Commodities (Price Display and Control of Supply and Distribution) order, 1971.
as amended by Second Amendment dated ' June 13, 1973 framed under Rule 114(2) of the Defence of India Rules, 1971 to issue every purchaser a correct receipt showing, inter alia, the name and address of the customer were found to have sold Light Diesel Oil repeatedly without complying with the said requirement and with the object make fictitious sale of the 22 Light Diesel Oil a scheduled commodity within the meaning of the said order, as is evident from the following: (i) Cash memo No. 62 dated 8 8 74 | | (ii) Cash memo no, 63 dated 14 8 74 | | (iii)Cash memo no 134 dated 7 10 74 | Name and address | of the customer (iv) Cash memo no, 135 dated 7 10 74| not given" | (v) Cash memo No. 145 dated 7 11 74| | (vi) Cash memo No. 146 dated 7 11 74| This ground no doubt discloses a clear overt act on the part of the petitioner from which an inference can be drawn that the petitioner had made a number of fictitious sales.
The details of the cash memos by which the sales had been made have also been given but the cash memos do not disclose the names and addresses of the customers, as required by the rules.
The petitioner has himself admitted in paragraph 13 of his petition filed in this Court that there had been a violation of the U.P. Sale of Motor Spirit Taxation Act and the Rules made thereunder but he sought to explain the omission on the ground that it was due to the mistake of the Munim and the quantities alleged to have been sold were actually purchased by the petitioner himself for the use of the pumps in his own agricultural farm.
This explanation does not appear to be convincing at all.
From the file produced before us by the respondents it appears that the total amount of sale of light diesel oil under these cash memos mentioned in the ground comes to 21 ,000 litres.
We find it impossible to believe that the petitioner would consume such huge quantity of light diesel oil for his personal agricultural farms particularly when the petitioner had given no details of the number of farms and other machines for which this oil was said to be used.
In these circumstances there can be no doubt that these were fictitious sales made by the petitioner with a view to hoard light diesel oil and by his conduct the persons who were in genuine need of light diesel oil were deprived of the same.
Ground No. (2), therefore is quite specific, but the difficulty is that in view of our finding that ground No. (1) is irrelevant it is not possible to determine as to what extent the subjective satisfaction of the detaining authority was influenced or affected by Ground No. (1) which has been found by us to be extraneous and irrelevant.
It has been held by us in several cases that where out of two grounds one ground is vague or irrelevant, then the entire order of detention falls to the ground.
In this view of the matter the order of detention suffers from this serious infirmity and must be quashed.
Secondly it was argued by the learned counsel for the petitioner that on the materials produced before us the subjective satisfaction of the detaining authority has also not been established.
To begin with it is not clear at all as to who passed the order of detention and who was satisfied regarding the sufficiency of the grounds.
In the second place the grounds appear to have been served by Mr. R. C. Arora the permanent District Magistrate of Badaun who has also signed the same which shows that he was the detaining 23 authority also.
On a consideration of these two points we are of the opinion that the contention of the learned counsel for the petitioner is well founded and must prevail.
Coming to the first point we find that Mr. section K. D. Mathur has clearly alleged in his counter affidavit that Mr. R. C. Arora the permanent District Magistrate of Badaun had proceeded on leave from October 21, 1974 to November 11, 1974 and during his absence the deponent section K. D. Mathur was acting as the District Magistrate of Badaun.
It is further stated in the affidavit that Mr. R. C. Arora rejoined his duty in November 12, 1974 and took charge of his office.
The order of detention, however, appears to have been passed while Mr. section K. D. Mathur was officiating as District Magistrate of Badaun and Mr. Mathur makes no secret of the fact that the order of detention was passed by him after being satisfied of the grounds of detention.
In the counter affidavit submitted by Mr. section K. D. Mathur before the High Court, which is Annexure at p. 66 of the Paper Book Mr. Mathur categorically stated that he himself had passed the detention order after recording his satisfaction.
In this connection paragraph 1 of the counter affidavit before the High Court is as follows: That the deponent was District Magistrate, Badaun on 8 11 1974, and he has passed the detention order against the petitioner after being fully satisfied that the petitioner was acting in a manner prejudicial to the maintenance of supplies and services essential to the community and as such he is well acquainted with the facts deposed to below.
" This allegation is reiterated and over emphasised in paragraph 23 of the same affidavit wherein Mr. Mathur makes a categorical averment which is as follows: ". the deponent submits that in his capacity as the District Magistrate he was fully competent to make the impugned order of detention.
The deponent further submits that on the basis of the evidence and the material placed be before him, to which he has referred above he was personally and fully satisfied as to the existence of sufficient basis to make the impugned order with a view to prevent the petitioner from indulging in activities prejudicial to the maintenance of essential services and supplies.
" In this very affidavit Mr. Mathur goes on to state that he had also farmed draft of the grounds on November 8, 1974 and that Shri R. C. Arora who took over on November 12, 1974 served these grounds on the petitioner which were drawn by the deponent Mr. section K. D. Mathur.
In this connection the averment runs as follows: "Sri R. C. Arora took over charge on November 12, 1974 and under his signature Sri Arora served these same grounds which the deponent had earlier drawn upon the petitioner.
" According to the clear and categorical averments made by Mr, section K. D. Mathur in his affidavit before the High Court the only role which was 24 assigned to Mr. R. C. Arora the permanent District Magistrate was A that he signed the grounds and served them on the detenu.
In other words, according to Mr. section K. D. Mathur, Mr. R. C. Arora was merely the serving officer and did not perform any other function in so far as the order of detention passed against the petitioner was concerned and yet this officer is imprudent enough to allege in paragraph 25 of the counter affidavit filed in this Court that the order of detention was passed not only by him but by the two detaining authorities, namely Mr. R. C. Arora and Mr. section K. D. Mathur.
In this connection Mr. Mathur averred as follows.
"That the order of detention was passed by the detaining authorities after they had fully satisfied themselves about the existence of the grounds.
" It would thus appear from this averment that the order of detention was not passed by one single person but by more than one person and taking the facts mentioned by the deponent it would appear that the order of detention appears to have been passed in two stages in he first instance by Mr. section K. D. Mathur who was full fledged District Magistrate on November 8, 1974 when the order of detention was passed, but who according to his own statement had first prepared a draft of the grounds.
The order of detention was then signed by Mr. R. C. Arora on November 13, 1974 and served on the detenu.
While Mr. section K. D. Mathur took the clearest possible stand before the High Court that he alone had made the order of detention and he alone was satisfied about the sufficiency of the grounds, but in his affidavit before this Court he seems to suggest that there were two detaining authorities both of whom were satisfied.
This shows the casual and cavalier manner in which the order of detention against the petitioner appears to have been passed in this case.
Even if the order had been made by Mr. section K. D. Mathur and signed, by him, there could have been no objection in Mr. R. C. Arora serving the grounds on the petitioner, because the law does not require that the person who actually signs the order or the grounds must also serve the same on the detenu.
But in this case it is not possible to determine as to who in fact made the order of detention.
F It is true that the Court cannot go behind the subjective satisfaction of the detaining authority, but such satisfaction does not confer a blanket power which may authorise the detaining authority to act in a ruthless or arbitrary fashion and the judicial decisions have undoubtedly carved out an area, though limited.
within which the subjective satisfaction of the detaining authority can be tested on the touchstone of objectivity.
It is obvious that the subjective satisfaction of the detaining authority is a sine qua non for the exercise of power of detention and it has got to be exercised properly and discreetly.
In Khudiram Das vs The State of West Bengal and others(1) this Court made the following observations: "The basic postulate on which the courts have proceeded is that the subjective satisfaction being a condition precedent for the exercise of the power conferred on the executive, the 25 court can always examine whether the requisite satisfaction is arrived at by the authority; if it is not, the condition precedent dent to the exercise of the power would not be fulfilled and the exercise of the power would be bad." In the instant case, in view of the contradictory stand taken by the detaining authorities, we are satisfied that the exercise of jurisdiction to detain the petitioner has not been made with due care and caution or in a proper and fair manner.
On this ground also the order of detention stands vitiated.
Section 3(1) of the Act runs.
thus: "3.
(1) The Central Government or the State Government may, (a) if satisfied with respect to any person (including a foreigner) that with a view to preventing him from acting in any manner prejudicial to (i) the defence of India, the relation of India with foreign powers, or the security of India, or (ii) the security of the State or the maintenance of public order, or (iii)the maintenance of supplies and services essential to the community, or (b) if satisfied with respect to any foreigner that with a view to regulating his continued presence in India or with a view to making arrangements for his expulsion from India; It is necessary so to do, make an order directing that such person be detained.
" This power can also be exercised by the officers mentioned in sub section
(2), and in the instant case we are concerned with the District Magistrate.
The words "make an order directing that such person be detained " clearly postulate three conditions (1) that the order must be made by the authority mentioned in section 3; (ii) the order must be duly signed by the said authority; and (iii) that only one authority and one authority alone can pass such order of detention.
The statute does not contemplate a sort of composite or a joint order passed by several authorities.
In the instant case the original order of detention passed by Mr. section K. D. Mathur bears his signature and even the grounds mentioned bear his signature.
In these circumstances we are unable to accept the affidavit of Mr. section K. D. Mathur that the grounds framed by him were merely draft grounds prepared by him which were signed by the permanent District Magistrate later.
It is obvious that unless the order made and the grounds prepared are signed by the authority concerned, the order is not made as contemplated by section 3 of the Act.
Further more, since the order is based on grounds to be served on the detenu, the order of detention could be passed only if the grounds are in existence and are prepared contemporaneously, otherwise the order 26 of detention becomes purely illusory.
In view, however, of the contradictory affidavits given by Mr. section K. D. Mathur, it is difficult to determine whether Mr. section K. D. Mathur or Mr. R. C. Arora passed the order of detention and as to who among them was satisfied regarding the grounds of detention.
This is also a very serious infirmity from which the order of detention suffers and as a result of which the order has to be set aside.
There appears to us to be a clear violation of the provisions of section 3 of the Act in this case.
Lastly we may mention that although the petitioner has pleaded he question of mala fides in the instant case, it is not necessary for us to decide the same in the view we take in this case, and that is why it was not seriously pressed by Mr. Asoke Sen ill the course of his arguments before us.
For the reasons given above, we allow the petition and quash the order of detention passed against the petitioner on November 8, 1974 and direct the petitioner to be released forthwith.
V.P.S. Petition allowed.

summary:
The petitioner was carrying on business in diesel oil, an essential commodity, in two places.
He was detained under section 3(1)(a)(iii) of the , on the basis of allegations in two grounds that as had committed sets prejudicial to the maintenance of supplies and services essential to the community.
The allegation in the first ground was that he had stocked a large quantity of light diesel oil in one of the places without waiting for the licence to be cleared by the Chief Controller of Explosives in violation of the provisions of the Petroleum Act.
It was also stated in the ground that a complaint had been lodged in the Magistrate 's court for the offence.
The allegation in the second ground was that the petitioner violated the U.P. Sale of Motor Taxation Act and the rules made thereunder, in that the names and addresses of customers who had purchased light diesel from tho petitioner, had not been given in the cash memos.
Allowing The petition, ^ HELD: (1)(a) There is no allegation by the detaining authority in the first ground that by storing the huge quantity of light diesel oil the petitioner had in any way affected the distribution or sale of that commodity; nor is there any allegation to show that the petitioner had refused to sell the oil to anybody who required it.
Also there is no suggestion, far less any allegation, that the petitioner had tried to divert his ' stocks from one place to the other and thereby deprived the people of one place of their share of the oil.
Therefore, there is absolutely no correlation between the act of the petitioner and the disruption of distribution of essential supplies to the community.
[20D E, F G] (b) From the violation of the mandatory provisions of the Petroleum Act and the Rules made thereunder, no presumption can be drawn that there was disruption of supply of the essential commodity.
[20G H] (c) The commission of an offence at a private place or a violation of a provision or a law by itself does not attract the unless, by the Act committed, the supply or an essential commodity to the community is disrupted or the even flow of the life of the community is disrupted.
[21B] Manu Bhushan Roy Prodhan vs State of Bengal and others, A. I. R. , referred to.
(2) The second Ground does disclose a clear overt act from which an inference can be drawn that the petitioner had made a number of fictitious sales.
But, in view of the finding that the first ground is irrelevant it is not possible to determine to what extent the subjective satisfaction of the detaining authority was influenced or affected by the first ground.
When out of 2 grounds one is ague or irrelevant, then the entire order of detention falls to the ground.
[22C, F G] (3) The Court cannot go behind the subjective satisfaction the detaining authority but such satisfaction does not confer a blanket power which may authorise the detaining authority to act in a ruthless or arbitrary fashion.
Judicial decisions have carved out an area though limited, within which, the subjective satisfaction of the detaining authority, which is a sine qua non for the exercise of the power, can be tested on the touchstone of objectivity.
[24F G] 17 (a) The words "make an order directing that such person be detained" in Section 3 (1) of the Act postulates three conditions: (i) that the order must be made by the authority in the section; (ii) The order must be duly signed by the said authority; and (iii) that only one authority and one authority alone can pass the order of detention.
Therefore, unless the order made and the grounds prepared are signed by the authority concerned, the order is not made as contemplated by the section.
[25F G] (b) Further, since the order is based on grounds to be served on the detenu, he order of detention could be passed only if the grounds are in existence and are prepared contemporaneously, otherwise the order of detention becomes illusory.
[25H 26A] In the present case, the District Magistrate who filed the counter affidavit was acting in place of the permanent District Magistrate.
In the High (court which was moved in the first instance for a writ of habeas corpus, the District Magistrate stated that the order of detention was passed by him after being satisfied of the grounds of detention, that he also framed the draft of the grounds and that the permanent District Magistrate, who took over from him merely signed and served those grounds on the detenu.
But, in this Court he stated that the order of detention was passed by the two detaining authorities, namely, both the District Magistrates, after they had fully satisfied themselves about the existence of the grounds.
It is, therefore.
not possible to determine as to who in fact made the order of detention.
and in view of the contradictory stand taken in the counter affidavits filed by the detaining authorities, the exercise of the jurisdiction to detain the petitioner has not been made with due care and caution or in a proper and fair manner.
[23B 24F] Khudiram Das vs The state of West Bengal and Other, A. 1.
R. 1975 section C. 550, referred to.
The Court also expressed strong disapproval of the careless and irresponsible manner in which the counter affidavit had been filed by the District Magistrate because the date on which reference was made to the advisory Board was in correctly stated in the counter affidavit which created unnecessary confusion and controversy over a simple issue] [18F G]


judgement:
Civil Appeal No. 1142 of 1969.
Appeal by special leave from the award dated the 8th November 1968 of the Labour Court, Poona in Reference (IDA) No. 9 of 1967.
B. Pai, O. C. Mathur, D. C. Shroff and O. N. Mishra, for the appellant.
section C. Manchanda and A. G. Ratnaparkhi, for the respondents.
The Judgment of the Court was delivered by ALAGIRISWAMI, J.
This is an appeal by special leave against the award of the Labour Court, Poona directing the reinstatement of the respondent in the service of the appellant company.
The respondent was a watchman in the factory of the appellant at Chinchwad, Poona.
A domestic enquiry was held against him in respect of an incident on the night of 15 16 December 1963 and following the enquiry he was dismissed from service on the 7th January 1964.
His appeal was dismissed after a personal hearing by the appellate authority.
Section 2A of the came into force on 1st December 1965 and on 23rd June 1967 a reference was made by the Government of Maharashtra regarding the dismissal of the respondent to the Labour Court, Poona and the Labour Court held that the domestic enquiry held against the respondent was defective, that the charges against the respondent had not been made out and directed him to be reinstated.
121 There were four charges framed against the respondent in the domes tic enquiry.
They were: (1) Suspected dishonesty in connection with the company 's property.
(2) Gross negligence in performance of his duties.
(3) Disobedience of instructions given by the superiors.
(4) Commission of an act subversive of discipline.
For the purposes of this appeal it is not necessary to consider other charges than charge No. 1.
The chargesheet is rather a bit confused but the statement of facts regarding charge No. 1 is clear and there cannot be any doubt or confusion about it.
The facts stated in the k chargesheet are as follows: "It is reported that while you were on duty in the and shift on Sunday the 15th December, 1963 at about 10.30 P.M. you left the guard room and went into the factory.
While returning from the factory you are reported to have brought out with you a new Fluroscent Tube and to have kept it in the guard room.
Immediately after this you are also reported to have directed one of the two watchmen on duty at that time to take a round with the tel a tel clock.
It is further reported that at about 11.20 P.M. you removed the Fluroscent Tube from the guard room and were carrying it away out of the factory.
At this stage you were challenged by the watchman, Shri M. B. Shinde and consequently you brought back the tube and left it in the guard room.
The Company had, however, not received any report in the matter from you.
You were, therefore, called up when you reported for duty on 16th afternoon and were questioned in the matter.
When you were asked to submit your written report about the incident and about your failure to report immediately to your superiors you stated that you will submit your report after consulting your pleader.
The above mentioned facts and particularly your unwillingness to submit written report when called upon to do so give rise to doubts about your integrity and faithfulness both in regard to the security and property belonging to the Company for which you are responsible while on duty as a person in charge of the security of the Company.
" The Labour Court took the view that the charge of suspected dishonesty in connection with the company 's property did not constitute any misconduct either under Standing order 24 or otherwise and there fore no action could be taken against the respondent on the basis of that charge, and also that the chargesheet was vague.
We can see no vagueness in the chargesheet and on the basis of the facts set out above there could be no doubt that the charge is one of an attempt to steal the 122 company 's property.
The respondent being a watchman the charge is a serious one and if it was held proved he deserves nothing short of dismissal.
The Labour Court was concerned only with the question whether the domestic enquiry held against the respondent was a proper enquiry.
It held that the enquiry was not a proper one on the ground that the respondent had produced a police constable as his witness at the time of enquiry and this witness expressed his inability to give evidence with out the permission of his superiors, that it was clearly the duty of the Inquiry officer to obtain the necessary permission and to help the respondent in the matter of his defence, that the reluctance on the part of the Inquiry officer to pursue the matter further is indicative of the fact that he was not inclined to afford proper opportunity to the respondent to defend himself, that there was no necessity for the respondent to apply again to the Inquiry officer for obtaining the necessary permission, that the passive approach adopted by the Inquiry officer in the matter had undoubtedly resulted in an opportunity to defend himself being denied and the inquiry will therefore be defective in this respect.
It summoned and examined the police constable and taking his evidence also into account held as follows .
"Then there is evidence on the record of the inquiry to show that the relations of the second party with the Security Jamadar Shri David were strained.
As a matter of fact the evidence shows that the reports from the watchmen started coming in at his instance.
The proceedings against the second party started on the report of Shri David.
The said report and the reports made by the other watchman and the second party are not forthcoming though referred to in the record of the inquiry.
Then there is the glaring fact that very ambiguous allegations and charges which do not even constitute any misconduct are made against the second party and in spite of the fact that the evidence in the inquiry is too conflicting and vague the concerned authorities have without affording proper opportunity to defend found the second party guilty of the charges levelled against him.
On a careful reading of the findings of the Inquiry officer, the Works Manager and the Appellate Authority in the light of the recitals in the charge sheet it becomes absolutely clear that they have found him guilty without applying their mind to the facts and circumstances of the case.
All these factors raise a strong presumption that the removal of the second party was predetermined by the first party and that his dismissal is by way of victimization.
For all the aforesaid reasons therefore the dismissal of the second party must be held to be illegal and improper There is nothing adverse the past against him and he is therefore entitled to the relief of reinstatement with back wages.
" The first argument on behalf of the appellant is that the incident took place in December 1963 and the order of dismissal was made on the 7th of January 1964 and as section 2A of the Industrial Disputes 123 Act came into force on 1 12 1965 the reference of this dispute under section 10 of the read with section 2A is bad It is argued that this will amount to giving retrospective effect to the provisions of section 2A.
We are not able to accept this contention Section 2A is in effect a definition section.
It provides in effect that what would not be an industrial dispute as defined in section 2(k) as interpreted by this Court would be deemed to be an industrial dispute in certain circumstances.
As was pointed out by this Court in Chemicals & Fibres of India Ltd vs D. G. Bhoir & Ors.(1) the definition could as well have been made part of clause (k) of section 2 instead of being put in as a separate section.
There is therefore no question of giving retrospective effect to that section in making the reference which resulted in the award under consideration.
When the section uses the words "where any employer discharges, dismisses, retrenches or otherwise terminates the services of an individual workman" it does not deal with the question as to when that was done.
It refers to a situation or a state of affairs.
In other words where there is a discharge, dismissal, retrenchment or termination of service otherwise the dispute relating to such discharge, dismissal, retrenchment or termination becomes an industrial dispute.
It is no objection to this to say that this interpretation would lead to a situation where the disputes would be reopened after the lapse of many years and referred for adjudication under section 10.
The question of creation of new rights by section 2A is also not very relevant.
Even before the introduction of section 2A a dispute relating to an individual workman could become an industrial dispute by its being sponsored by a labour union or a group of workmen.
Any reference under section 10 would be made only sometime after the dispute itself has arisen.
The only relevant factor for consideration in making a reference under section 10 is whether an industrial dispute exists or is apprehended.
There cannot be any doubt that on the day the reference was made in the present case an industrial dispute as defined under section 2A did exist.
Normally the dispute regarding an individual workman is not an industrial dispute unless it is sponsored by the union to which he belongs or a group of workmen.
The change made by section 2A is that in certain cases such a dispute need not be so sponsored and it will still be deemed an industrial dispute.
Supposing in this very case a labour union or a group of workmen had sponsored the case of the respondent before the reference was made, such a reference would have been valid.
All that section 2A has done is that by legislative action such a dispute is deemed to be an industrial dispute even where it is not sponsored by a labour union or a group of workmen.
What a labour union or a group of workmen can do the law is competent to do.
The only question for consideration in considering the validity of a reference is whether there was or apprehended an industrial dispute when the reference was made.
If there was an industrial dispute or an industrial dispute was apprehend.
even though the facts giving rise to that dispute might have arisen before the reference was made the reference would still be valid.
It is to be borne in mind that every reference would be made only some 124 time after the dispute has arisen.
In Birla Brothers Ltd. vs Modak(1) it was pointed out that though the came into force in 1947, reference of an industrial dispute based on the facts which arose before that Act came into force is a valid reference.
The same reasoning would apply to a reference of a dispute falling under section 2A even though the facts giving rise to that dispute arose before that section came into force.
The decision in Birla Brothers case (supra) was approved by this Court in its decision in Jahiruddin vs Model Mills 13 Nagpur(2).
These two decisions clearly establish that the test for the validity of a reference under section 10 is whether there was in existence a dispute on the day the reference was made and there was no question of giving retrospective effect to the Act.
We find that is the view taken by the Delhi High Court in National Productivity Council vs section N. Kaul(3) by the Punjab & Haryana High Court in Shree Gopal Mills Ltd. vs The State of Haryana(4).
The view of the High Court of Mysore in P. Janardhana Shetty vs Union of India(5) to the contrary is not correct Coming now to the other points in the case: the decisions of this Court establish clearly that when a workman is dismissed as a result of a domestic enquiry the only power which the Labour Court has is to consider whether the enquiry was proper and if it was so no further question arises.
If the enquiry was not proper the employer and the employee had to be given an opportunity to examine their witnesses.
It is not the duty of the Enquiry officer in this case to seek permission of the police constable 's superiors.
It was the respondent 's duty to have him properly summoned.
He did not even apply to the Enquiry officer requesting him to seek the permission of the police constable 's superiors.
It is therefore wrong on the part of the Labour Court to have held that the enquiry against the respondent was not a proper enquiry.
Once this conclusion is reached there was no room for the summoning and examination of the police constable by the Labour Court.
The question regarding the jurisdiction exercised by an Industrial Tribunal in respect of a domestic enquiry held by the management against a worker has been elaborately considered by this Court in its decision in D.C.M. vs Ludh Budh Singh(6) and the principles that emerge out of the earlier decisions of this Court have been set out in that decision.
The decision of this Court in Workmen vs Firestone Tyre & Rubber Co.(7) also sets out the principles that emerge from the earlier decisions.
In Tata Oil Mills Co. Ltd. vs Its Workmen(8) it was argued that where the employee is unable to lead his evidence before the domestic Tribunal for no fault of his own, an opportunity should be given to him to Prove his case in proceedings before the Industrial Tribunal.
This Court held that this contention was not well founded.
It was pointed out that the Enquiry officer gave the employee ample opportunity to lead his evidence and the enquiry had been fair.
It was also pointed out that merely because the witnesses did not appear 125 to give evidence in support of the employee 's case it could not be held that he should be allowed to lead such evidence before the Industrial Tribunal and if such a plea was to be upheld no domestic enquiry would be effective and in every case the matter would have to be tried afresh by the Industrial Tribunal.
It was pointed out that findings properly recorded at the enquiries fairly conducted were binding on the parties, unless it was shown that the said findings were perverse, or were not based on any evidence.
We are not able to agree with the Labour Court in this case that the findings of the domestic enquiry arc either perverse or not based on any evidence.
We therefore come to the conclusion that there was no failure on the part of the Enquiry officer to give a reasonable opportunity to the respondent workman, that the enquiry was fair and the Labour Court had, therefore, no right to examine the witness on behalf of the workman and based on that evidence to upset the finding arrived at the domestic enquiry.
We also hold that the punishment imposed in the circumstances is one in which the Labour Court cannot interfere.
The result is that the appeal will have to be allowed and the award of the Labour Court set aside.
It, however, appears that the respondent had attained the age of 60 on 11 6 73 and even if he had been in service he would have re tired on that date.
Under an interim order made by this Court on 29 4 1969 the respondent has been paid Rs. 200/ per month as part of the remuneration payable to him till the hearing and final disposal of the appeal and such payment has been made upto date.
Even if the respondent had succeeded in this appeal he would not have been entitled to any payment after 11 6 73.
In view of this appeal being allowed and the award of the Labour Court being set aside the respondent will have to repay the money he had received in, pursuance of the order of this Court.
The appellant has agreed that it would not take any steps to recover from the respondent the payments already made to him.
There will be no order as to costs.
V.P.S. Appeal allowed.

dataset_name: IN-Abs

summary:
Section 2A of he , provides that where any employer discharges, dismisses, retrenches or otherwise terminates the service of an individual workman, any dispute or difference between that workman and his employer connected with or arising out of such discharges etc., shall be deemed to be an industrial dispute notwithstanding that no other workman nor union is a party to the dispute.
The respondent was a watchman in the factory of the appellant.
He was dismissed from service on Jan. 7, 1964, after holding a domestic enquiry with respect to an incident on the night of December 15, 1963.
In June 1967 the dispute regarding the dismissal of the respondent was referred to the Labour Court.
Directing him to be reinstated, the Labour Court, held that: (1) The charge against the respondent was vague; (2) The suspected dishonesty of the respondent in connection with the appellant 's property did not constitute any misconduct either under Standing orders of the Company or otherwise; and (3) The domestic enquiry held was defective because, the respondent produced a police constable as his witness at the time of the enquiry who expressed his inability to give evidence without the permission of his superiors and the Enquiry officer took no steps for obtaining the necessary permission.
The Labour court summoned and examined the police constable and took his evidence into account.
In appeal to this Court, it was contended: (1) That section 2A came into force only on December 1, 1965 and as the dismissal took place before that date the reference of the dispute was bad; and (2) That the finding of the Enquiry officer was based upon a fair enquiry and the Labour Court should not have interfered with the finding.
Allowing the appeal to this Court on the second contention, ^ HELD: (1) The est for the validity of a reference under section 10 is whether there was in existence a dispute on the day the reference was made.
[124B C] Juhiruddin vs Model Mills, Nagpur , applied.
National Productivity Council vs section N. Kaul [1969] II L.L.J 186 and Shree Gopal Paper Mills Ltd. vs State of Haryana, , approved.
P. Janardhana Shetty vs Union of India [1970] II L.L.J. 738, over ruled.
(a) Section 2A provides in effect that what would not be an industrial dispute as defined in section 2 (k), as interpreted by this Court, would b deemed to be an industrial dispute in certain circumstances.
There is no question of giving retrospective effect to that section in making the reference.
When the section uses the words "discharges dismisses, retrenches etc.
" it does not deal with the question as to when that was done but merely refers to a situation or state of affairs.
[123B D] 120 (b) It is no objection to this to say that.
such an interpretation would lead to an old dispute being reopened after the lapse of many years, Every reference would be made only sometime after the dispute has arisen.
Even in this case, if a labour union or a group of workmen had sponsored the case of the respondent, such a reference after lapse of some time would have been valid.
All that section 2A has done is that by legislative action such a dispute is deemed to be an industrial dispute even where it is not sponsored by a labour union or a group of workmen.
The only consideration in such matters is whether there was or apprehended an industrial dispute when the reference was made.
[123D 124B] (2) The charge is not vague.
[121H] (3) The facts set out show that the charge is one of an attempt to steal the appellant 's property and if proved, the respondent, being a watchman, deserves dismissal.
[121H 122A] (4) When a workman is dismissed as a result of a domestic enquiry the only power which the Labour Court has is to consider whether the enquiry was proper and if it was so, no further question arises.
Findings properly recorded at an enquiry fairly conducted are binding on parties unless is shown that such findings were perverse.
It was not the duty of the Enquiry officer to seek permission of the constable 's superiors and it was the respondent 's duty to have his witnesses properly summoned.
The enquiry was fair and the Labour Court had no right to examine the witness on behalf of the workman and based on that evidence to upset the finding arrived at the domestic enquiry.
[124D 15C] D.C.M. vs Ludh Budh Singh ; Workmen vs Firestone Tyre & Rubber Co. ; and Tata Oil Co. Ltd. vs Its Workmen ; , referred to.


judgement:
Civil Appeals Nos. 299 and 120 to 124 of 1972.
From the Judgment and order dated the 25th March, 1970 of the Punjab & Haryana High Court in Civil Writ No. 325 of 1968, L.P.A. No. 177 of 1969, Civil Writ No. 1534, 1545, 1829 and 2201 of 1969 respectively.
G. L. Sanjay, section K. Mehta, R. L. Batta and M. Qumaruddin, for the appellants (in Civil Appeal No. 299/72).
2 V. C. Mahajan, section section Khanduja and R. L. Bata, for the appellants (In C.As.
120 124/72) D. Mukherjee, Hardev Singh, R. section Sodhi and G. C. Garg, for the respondents.
(In C.A. No. 299/72).
The Judgement of the Court was delivered by GOSWAMI, J.
In these appeals by certificate of the High Court of Punjab and Haryana validity of action taken by the Market Committee, Patiala, under the provisions of the Punjab Agricultural Produce Markets Act, 1961, is under challenge.
The appellants are shop keepers of Gur Mandi, Patiala, and are licensees under section 10 of the Punjab Agricultural Produce Markets Act, 1961 (briefly the Act) and are also pucca arhtiyas.
It is not in dispute that they sell gur and shakkar within the market area notified under the Act.
It is also admitted that they have licences under section 10 of the Act in Form 'B ' as kacha arhtiyas or commission agents.
Since they were found to be selling gur and shakkar in their own shops within the notified market area without submitting accounts and without payment of fees they were asked to show cause by the Market Committee why legal action should not be taken against them for violation of rules 29(3) and 31(1) of the Punjab Agricultural Produce Markets (General) Rules, 1962 (briefly the Rules) and for violation of condition No. 1 of the licence which is to the effect that the licensee shall comply with the provisions of the Act, Rules and Bye laws framed thereunder and instructions issued from time to time.
The appellants disclaimed liability to pay fee under the Act on various grounds.
The Administrator of the Market Committee after some correspondence levied on one of the appellants, M/s Prem Chand Ram Lal, appellants in Civil Appeal No. 120 of 1972, Rs. 5014/ as market fee on the basis of best judgment assessment and imposed equal amount of penalty and a demand notice was issued for payment.
M/s Prem Chand Ram Lal filed a writ application before the High Court for quashing the demand notice.
The High Court allowed the petition quashing the order of assessment as arbitrary and violative of the principles of natural justice.
The High Court, however rejected the other contentions of the said petitioner questioning the validity of the fee levied.
M/s Prem Chand Ram Lal filed a Letters Patent Appeal against the judgment of the learned single Judge rejecting their other substantial points.
The appellants in civil Appeal No. 299 of 1972 had also filed a writ application under articles 226 and 227 of the Constitution in the High Court questions the action taken against them as well as the levy under the Act.
By a common judgement of March 25, 1970 the Division Bench of the High Court dismissed the Letters Patent Appeal of M/s Prem Chand Ram Lal as also the writ application of the appellants and granted certificates to appeal to this Court.
The question is whether the appellants are liable to payment of fee under the Act.
3 Action in this case was taken for violation of rules 29(3) and 31(1) of the Rules.
We will read these rules : R.29(1). 'Under section 23 a Committee shall levy fees on the agricultural produce bought or sold by licensees in the notified market area at the rates fixed by the Board from time to time`. " (3) "The fees shall be paid to the Committee or a paid officer duly authorised to receive such payment on the day of the transaction or on the following day".
R.31(1).
"Every licensed dealer and every dealer exempted under rule 18 from obtaining a licence shall submit to the Committee a return in Form M showing his purchases and sale of each transaction of agricultural produce on each day, on the day on which the transaction takes place or on the following day . . " The fault of the appellants lies in that they have neither paid fees under rule 29(3) nor have they submitted returns in Form 'M '.
A perusal of the above two rules would show that the Committee is authorised to levy fees on agricultural produce brought or sold only by a licensee in the notified market area.
Similarly under rule 31 (1) only a licensed dealer is required to submit a return.
We have now to take note of the scheme disclosed in a few other relevant provisions which are material for our purpose.
Under section 10 of the Act "any person may apply to the authority specified in section 9 for a licence which may be granted for such period, in such form, on such conditions and on payment of such fees not exceeding one hundred rupees as may be prescribed".
There is a proviso to this sub section whereby "if any personal carrying on any business of the nature specified in sub section (3) of section 6 in a notified market area on the date of issue of notification under sub section (1) of that section fails to apply for licence on or before the date specified therein t`or obtaining licence, the prescribed authority may, before a licence is issued, impose on him such penalty not exceeding one hundred rupees as may be prescribed".
By section 5 of the Act the State Government by notification declares its intention of exercising control over the purchase, sale, storage and processing of specified agricultural produce in a specified area.
By section 6(1) the Government by notification notifies a market area for the purpose of the Act.
Section 6(3) may be quoted: 6(3). "After the date of issue of such notification or from such later date as may be specified therein, no person, unless exempted by rules made under this Act, shall, either for him I self or on behalf of another person, or of the State Government within the notified market area set up, establish or continue or allow to be continued any place for the purchase, sale, storage and processing of the agricultural produce except 4 under a licence granted in accordance with the provisions of the Act.
the rules and by laws made thereunder and the conditions specified in the licence. ." As we read the above sub section it is clear that no person shall, unless exempted by rules, inter alia, purchase, sell, store or process the specified agricultural produce except under a licence.
It is not the case of the appellants that they belong to the exempted class.
Rule 17(1) provides that "a person desirous of obtaining a licence under section 10 of the Act shall apply in Form A (to be submitted in duplicate) to the Chairman of the Board through the Committee of the area in which he wishes to carry on his business and shall also deposit with the committee the requisite licence fee".
Sub rule (3) provides that if any person on the specified date fails to apply for a licence, he is liable to penalty in accordance with a certain scale.
Under sub rule (7) "the Chairman may grant a licence to the applicant in Form B.
The licence shall be subject to the conditions mentioned therein".
When we look to Form 'A ' which is the form for application for a licence under section 10 we find that against entry 8, the applicant has to give the "particulars of the business for which the licence is required" under four heads: (1) Kacha Arhtiya (2) Commission Agent (3) Storage (4) Processing Similarly in Form 'B ' which is the form of the licence under section 10, against entry 5, the same particulars of the business as against entry in Form 'A ' appear.
As a matter of fact one of the licences of the appellants was shown to us and it was in accordance with Form 'B '.
It is, therefore, clear that no licence has been issued to the appellants for doing business of buying and selling agricultural produce.
It is the case of the appellants that they make direct purchases and this fact is not controverted.
Although, there are, the appellants are licensees as required for some of the businesses mentioned in Form 'B ', they have no licence for carrying on business of purchase and sale of agricultural produce within the notified market area.
Now under section 23 "a Committee may, subject to such rules as may be made by the State Government in this behalf, levy on ad valorem basis fees on the agricultural produce brought or sold by licensees in the notified market area at a rate not exceeding rupee one fifty paise for every one hundred rupees, provided. . " Section 43 provides for rule making power.
Rule 24 is referable to section 43(2)(v), but we are not concerned with this rule in this case.
Rule 29 provides that under section 23 a Committee shall levy fees on the agricultural produce bought or sold by licensees in the notified market area at the rates fixed by the Board from time to time.
Reading section 23 and rule 29 together it is not possible to escape from the conclusion that the Act 5 authorises levy of fee on agricultural produce bought or sold by licensees only.
The appellants have licence only in respect of the business of kacha arhtiya and commission agent.
While we express no opinion on the point whether the absence of reference to buying and selling of agricultural produce in Form 'A ' and Form 'B ' disables the Committee to issue licences for that purpose, we are of opinion that the present appeals can be disposed of all the sole ground that the appellants have not as a matter of fact been issued such licences and no fees can, therefore, be levied on them in respect of purchases and sales of agricultural produce by them.
The appellants are, therefore, not liable to payment of fee under the Act as demanded.
The appellants also contend that since gur and shakkar are manufactured products they cannot come under the definition of agricultural produce with the meaning of section 2(a) of the Act.
Section 2(a) defines agricultural produce to mean "all produce whether processed or not, of agriculture, horticulture, animal husbandry or forest as specified in the Schedule to this Act" which mentions 85 items of commodities.
These are statutorily agricultural produce under section 2(a).
It is not possible to entertain the argument that the Court will undertake a judicial scrutiny of these items in order to come to a conclusion whether these are agricultural produce or not.
In view of the definition in section 2(a) such an enquiry is out of place.
In this context we may note that under section 38 the State Government may be notification add to the schedule any other item of agricultural produce or amend or omit any such specified item It is because of this power to add to the schedule items of agricultural produce that the first part of the definition under section 2(a) gives guidance as to what agricultural produce means.
The submissions are.
therefore.
devoid of substance.
In the result the appeals are allowed.
The appellants are not liable for payment of fee with regard to their sales in the notified market area other than in the capacity as kacha arhtiyas or commission agents.
In the circumstances of the case there will be no order as to costs.
P.H.P. Appeals allowed.

summary:
The appellants sell Gur and Shakkar within the market area notified under Punjab Agricultural Produce Markets Act, 1961.
The appellants have obtained licences under Section 10 of the Act in Form as Commission Agents.
Since the appellants were selling Gur and Shakkar in their own shops within the notified market area without submitting accounts and without Payment of fees they were asked to show cause by the Market Committee why legal action should not be taken against them for violation of rules 29(3) and 31(1) of the Punjab Agricultural Produce markets (General) Rules, 1962.
The appellants dismissed their liability to pay the fees under the Act.
The Administrator of Market Community levied fees on the appellants on the basis of best judgment assessment and also imposed penalty.
The High Court allowed the Writ Petitions filed by the appellants and quashed the order of assessment as arbitrary and violative of the principles of natural justice.
The High Court, however, rejected the contention of the appellants questioning the validity of the fees levied.
Under section 10 of the Act any person may apply for a licence which may be granted on such conditions as may be prescribed.
Under section 6(3) after tho issue of a notification under section 6(1) no person can purchase or sell any Agricultural produce except under a licence granted in accordance with the pro visions of the Act.
Section 23 authorizes the Committee to levy fees on the agricultural produce bought or sold by the licensees in the notified market area.
Rule 29 provides that the Committee shall levy fees on the agricultural produce bought or sold by licensees in the notified market area.
Rule 17(1) provides that a per son desirous of obtaining a licence under section 10 of the Act shall apply in form A.
The licence granted to the appellant is in accordance with form B. No licence has been issued to the appellants for doing the business of busing and selling agricultural produce.
Therefore, although the appellants are licensees as required for some of the businesses mentioned in Form B. they have no licence for carrying out business of purchase and sale of agricultural produce within the notified Market Area.
Reading section 23 and rule 29 it is clear that the Act authorises levy of fee on the agricultural produce bought or sold by licensees only.
Allowing the appeal, ^ HELD : The appellants have not as a matter of fact been issued licences as contemplated by section 23 and rule 29, and no fees can, therefore, be levied on them in respect of purchase and sale of agricultural Produce by them.
The appellants are, therefore, not liable to payment of fee under the Act as demanded.
[15B C]