Bhatnagars and Co. Ltd. Vs. The Union of
India [1957] INSC 20 (21 February 1957)
GAJENDRAGADKAR, P.B.
DAS, SUDHI RANJAN (CJ) AIYYAR, T.L.
VENKATARAMA SINHA, BHUVNESHWAR P.
DAS, S.K.
CITATION: 1957 AIR 478 1957 SCR 701
ACT:
Import and ExPort, Control of--Soda ash, if
can be imported without licence-Issue of licence, if amounts to delegated
legislation-Trafficking in licence - Confiscation of consignments and seizure
of licence by Sea Customs Authorities - -Issue of Writs- -Policy Statement 702
by Government, if amounts to monopoly-Import and Export (Control) Act, 1947
(XVIII of 1947), s. 3(1)(a)-Constitution of India, Art. 32.
HEADNOTE:
The petitioner obtained a licence for
importing soda ash during the free licencing period in 1952. On the basis of
the licence certain consignments of soda ash were received in Bombay. 'The
Customs Authorities had reason to suspect that the petitioner was trafficking
in his licence and on investigation found that two of the consignments had
actually been imported by another party and confiscated them' The petitioner
appealed to the Central Board of Revenue and thereafter moved the Government of
India, but to no effect. The Collector of Customs ordered the goods to be
auctioned. Five petitions were filed in this court under Art. 32 of the
Constitution seeking for the issue of appropriate writs in respect of the
confiscation of the goods and seizure of the licence. It was contended on
behalf of the petitioner that the Imports and Exports (Control) Act, 1947 not
having re-enacted the provisions of r. 84(2) Of the Defence of India Rules, S.
3(1)(a) of the Act had no application to soda ash and no licence was required
to import it ; that, in the alternative, legislation authorisirig the issue of licences
amounted to delegated legislation and was, therefore, invalid. It was further
contended that the Policy Statement made by the Government in the Press Note
dated February 1955, and Public Notice dated June 30, 1956, created a monopoly
and infringed the petitioner's fundamental right to carry on his trade and
business and lastly, that the virtual invalidation of his licence having been
improperly made should be set aside and the same directed to be revalidated for
the unexpired period.
Held, that the contentions raised on behalf
of the petitioner must fail and the petitions must be dismissed.. I The
language Of S. 3(1)(a) of the Imports and Exports (Control) Act, 1947, made it
abundantly clear that it was intended to apply to the import of all goods of
specified description covered by r. 84(2) Of the Defence of India Rules
including soda ash so as to render the re-enactment of that rule wholly
unnecessary. The provision of the section must be read disjunctively and
distributively and it was wholly unreasonable to suggest that the words
'import' and 'export' could be qualified by the expressions ,carriage
coastwise' or 'shipment as ships' stores' occurring in the section.
Nor could the section be held to be ultra
vires on the ground of delegated legislation as the preamble and the relevant
sections of the Act as also those of the Defence of India Act, which it
purported to continue and to which reference would be perfectly legitimate,
show that the Legislature had clearly indicated the, policy and enunciated the
principles that were to guide those entrusted with the implementation of the
Act which had for its purpose the maintenance of supplies essential to the
community.
Harishankar Bagla v. The State of Madhya
Pradesh, (1955) I S.C.R. 380, applied.
703 Pannalal Binjraj v. The Union of India,
(1957) S.C.R. 233, referred to.
It was perfectly open to the Government of
India to change its import and export policy with a view to adjust it to the
varying needs of the country and if importers were found to resort to
malpractices leading to instability of prices, it would be its duty to
intervene and regulate distribution, if need be, with the assistance of
importer-stockists working under its general supervision and no exception could
be taken to such a policy on the ground that it created a monopoly or infringed
the fundamental right to carry on trade or business.
As, in the instant case, the goods were
lawfully confiscated by the Sea Customs Authorities as a result of an
investigation which they were competent to make, it was not open to the
petitioner under Art. 32 of the Constitution to challenge their conclusions on
the ground that they had not been properly drawn and no question, therefore, of
any revalidation of. his licence could at all arise.
ORIGINAL JURISDICTI0N: Petitions Nos. 377 of
1955 and 42, 46, 164 and 423 of 1956.
Petitions under Article 32 of the
Constitution of India for the enforcement of fundamental rights' Petitioner in
person in Petitions Nos. 377 of 1955 and 164 and 423 of 1956.
H. J. Umrigar and Y. Kumar, for petitioner in
Petitions Nos. 42 and 46 of 1956.
C. K. Daphtary, Solicitor-General of India,
Porus A. Mehta and R. H. Dhebar, for respondents in Petitions Nos. 42, 46 and
423 of 1956.
C. K. Daphtary, Solicitor-General of India,
B. Sen and R. H. Dhebar, for respondents in Petitions Nos.' 377 of 1955 and 164
of 1956.
1957. February 21. The Judgment of the Court
was delivered by GAJENDRAGADKAR J.-This is a group of five petitions filed by
the petitioners Messrs Bhatnagars & Co. Private Ltd. In all these
petitions, the petitioner Shri B. S. Bhatnagar, Managing Director of the above
company, seeks to obtain appropriate writs from this Court mainly in respect of
orders which have been passed by the Sea Customs Authorities against the
petitioner. The petitioner seems to feel a grievance 704 that, in the matter of
licences which had been issued to him for importing 'soda ash, he has not
received a fair treatment from the appropriate authorities and, since the
impugned orders were passed, he has been moving the High Court of Punjab and
this Court by several petitions under the Constitution. The present petitions
show obvious traces of unskilled draftsmanship. They are extremely diffused and
in many places incoherent. Statements of fact are not logically or
chronologically made and there is complete confusion in the narration of the
story giving rise to the petitioner's claim. In several places, the petitions
refer to facts which are both irrelevant and immaterial and, often enough, the
petitioner is unable to restrain him. self from making unjustified and
irrelevant suggestions against the authorities. Even in regard to the claim
ultimately made by the petitioner, it is not easy to find what exactly the
petitioner's grievance is and what particular writ he seeks to obtain from this
Court. However, since the petitions purport to invoke the jurisdiction of this
Court substantially under Art. 32 of the Constitution, it is necessary to deal
with the relevant points in disposing of these petitions.
Three of the petitions have been argued by
Shri Bhatnagar in person. They are Petitions Nos. 423 and 164 of 1956 and No. 377
of 1955. Petitions Nos. 42 and 46 of 1956 have been argued by Shri Umrigar on
behalf of the petitioner. The material facts which it is essential to mention
are very few and they i.e within a very narrow compass. It appears that the
petitioner obtained a licence for the import of soda ash only worth about Rs.
50,00,000 during the free licensing period in 1952. In pursuance of this
licence, and relying on the same, consignments of soda ash to the extent of 100
tons, 200 tons and 20 tons respectively were received at Bombay; but meanwhile
the Customs Authorities had received information that, though the petitioner
had obtained a licence in his name for the import of soda ash for such a large
amount as Rs. 50,00,000, his capital did not exceed Rs. 15,000 and that he was
in fact trafficking in these licences. On receiving this report, investigation
was made and 705 subsequently the matter was left in charge of 'the Special
Police Establishment. During the course of this investigation, certain
documents were seized from the petitioner-company's office as well as from the
office of one Messrs N. Jivanlal & Co. at Bombay. The complaint made
against the petitioner that he was trafficking in licences was confirmed by
this investigation. It transpired that a person carrying on business in the
name of Messrs. N. Jivanlal & Co., had a free hand in dealing with the
licences of the petitioner and that the petitioner used only to receive
commission for the imports that he allowed to be made in the name of Messrs
Bhatnagars & Co., Ltd. In regard to the two consignments of 100 tons and 20
tons of soda 'ash respectively, it was found on an inspection of the documents
that the same had been imported by Messrs N. Jivanlal & Co., and since
Messrs N. Jivanlal & Co., held no licence, the consignments were seized by
the Collector of Customs. The offices of the petitioner and Messrs N. Jivanlal &
Co., were raided during the course of this investigation on November 7,1952 and
February 6, 1953, respectively. The goods arrived in Bombay in March and April
1953 and they were confiscated by the Collector of Customs in May and June
1953. Subsequently, the documents including the licences which had been seized
were returned to the petitioner. The confiscation of the goods was challenged
by the petitioner by preferring an appeal to the Central Board of Revenue.
The said appeal was, however, dismissed. The
petitioner then moved the Central Government against this, order but on
September 22, 1955, the Central Government refused to interfere. It appears
that on March 31, 1956, the Collector of Customs ordered that the goods should
be auctioned. When this order was passed, the petitioner filed one of the
petitions before us. - He obtained an interim order of stay but the said order
was ultimately vacated. Broadly stated, these are the facts which give rise to
the present petitions.
Though five petitions have been presented by
the petitioner, his grievance substantially is against the confiscation of the
consignments of soda ash and 706 against the seizure of his licences by the
investigating authorities: Each petition seeks to put the grievance of the
petitioner in a different form and, though the prayers ultimately made are also
not of the same pattern, in the main, the petitioner wants this Court to give
him relief against what he regards as illegal seizure of the goods and against
the virtual invalidation of his licences for import.
The period during which the licences granted
to him could have been operated upon has expired and the petitioner, in one of
his petitions, seeks an order from this Court direct- ing the Government to
revalidate the licences so as to allow the petitioner to import the article in
question during the unexpired period of his licences.
Though it would have been possible to deal
with these petitions collectively by delivering a, common judgment, we would
prefer to deal with the matter separately and consider the points raised in
each petition by itself.
Petition No. 423 of 1956 in a sense stands
apart from the other petitions in the present group. The facts which we have
already mentioned are enumerated by the petitioner even in this petition but the
,substantial relief which he seeks to claim and which the petitioner pressed
before us in his argument is in respect of his allegation that the -Union of
India and other respondents to the petition have acted in contempt of this
Court and appropriate action should, therefore, be taken by us against the said
respondents.
This contention arises in this way. The
petitioner had made a similar petition to this Court, No. 571 of 1954, in
respect of one of the three consignments, in question. This petition had come
before this Court for hearing on March 24, 1955. Shri K. R. Chaudhury appeared
for the petitioner before this Court. The order passed by this Court would show
that the learned Solicitor-General of India made a statement to the Court
indicating that the goods which had been confiscated by the Customs Authorities
would not be, sold or otherwise dealt with for a month from the date of the
communication to the petitioner of the final order that the Central Government
may pass in the revisional petition 707 preferred by him before them. Acting on
this under. taking, this Court allowed the petitioner a period of one month
from the date of the communication to him of the final order which the Central
Government might pass on his revisional petition to enable him to file a
petition for Special Leave to appeal if he was so advised. Then the order
recorded the undertaking given by the Solicitor-General. Subject to this order
the petition was dismissed. However, no order was passed as to costs. It is
common ground that for several months thereafter the revisional petition
preferred by the petitioner to the Central Government was not disposed of.
Ultimately it was dismissed. The petitioner
seems to be under the impression that the Solicitor-General, on behalf of the
Central Government, had given an undertaking that the petitioner's revisional
petition would be disposed of within a certain specified time. Indeed the
petition seeks to suggest that the undertaking was that the revisional petition
would be dispose immediately in a day or two, and, since the revisional
petition was not disposed of within the time mentioned by the
Solicitor-General, the petitioner says that all the respondents are guilty of
contempt. It is clear that the petitioners grievance and the prayer for a -writ
are entirely misconceived. The petitioner is entirely in error in assuming
that, on behalf of the Union of India, any undertaking was given that his
revisional petition would be disposed of within a day or two. Indeed, the
Solicitor- General fairly told us that, at the time when the petitioner's
earlier application was disposed of, he had expressed the hope that the
petitioner's revisional petition would be dealt with by the Central Government
at an early date; but the expression of this hope had nothing to do with the
undertaking which the Solicitor-General gave and which was included in the
Court's order. The petitioner presumably thinks that the Court's order required
that his revisional petition should be disposed of by the Central Government
within a month. This assumption is entirely unwarranted. The period of one
month which is mentioned in the order was the period granted to the petitioner
to move 91 708 this Court for Special Leave after the decision of his
revisional petition by the Central Government was communicated to him. In other
words, if the decision of the Central Government had gone against the
petitioner, the petitioner was given one month's period within which to move
this Court for Special Leave and the Union of India agreed not to deal with the
property of the petitioner or dispose of it during that period. In our opinion,
the order is plain and unambiguous and there is no scope for any mis-
understanding whatever. If no undertaking was given as assumed by the
petitioner, it is impossible to understand how any contempt can arise on the
ground that the undertaking had not been complied with. Besides, the petitioner
has not stopped to consider which person the Union of India represents as
Respondent No. 1 in his petition. He has also not paused to consider how the
other respondents could be guilty of contempt. We have no hesitation in holding
that the prayer for a writ in respect of the alleged contempt made by the
petitioner in this petition is thoroughly unjustified and, we regret to add,
wholly irresponsible. This was the only point, which the petitioner urged
before us in this petition. The result is the petition fails and it must be
dismissed with costs.
In Petition No. 164 of 1956, so far as we
were able to gather, the petitioner's grievance is in respect of a policy
statement made by the Government in the Press Note dated February 3, 1955 and
Public Notice No. 25-ITC (PN)/ 56 dated June 30, 1956. The petitioner's
contention appears to be that the policy enunciated in these two documents
amounts to a monopoly and he wants this Court to issue appropriate writs
terminating this monopoly and to ensure to the petitioner his fundamental right
of carrying on his trade and business. In our opinion, this petition is also
entirely misconceived and there is no substance in the contention raised by the
petitioner. It is hardly necessary to emphasize that, in modern times, the
export and import policy of any democratic State is bound to be flexible. The
needs of the country, the position of foreign exchange, the need to protect
national industries 709 and all other relevant considerations have to be
examined by the Central Government from time to time and rules in regard to
export and import suitably adjusted. It would, therefore, be idle to suggest
that there should be unfettered and unrestricted freedom of export and import
or that the policy of the Government in regard to export and import should be
fixed and not changed according to the requirements of the country. It is in
the light of this position that the policy statement in the Press Note has to
be considered. The Press Note covers several commodities, but, since we are
concerned with Light soda ash in the present case, it would be relevant to
refer briefly to the - contents of the Press Note in regard to Light soda ash.
In regard to this commodity, Government have decided, says the Press Note, that
the import should be canalised through importer-stockiats who would be required
to keep buffer stocks and effect sale in a manner so as to eliminate
fluctuations in prices and supplies experienced by consumers in the recent
past. The Government realized that, without canalisation of distribution of
this commodity, consumers were always at the mercy of the importers and even
distribution of the commodity to all parts of the country where it was needed
was also difficult to obtain. That is why the Government decided to canalise
the distribution of this. commodity with the assistance of two selling
organisations of Messrs. Tata Oil Mills Co. Ltd., and Messrs. I.C.I. (India)
Ltd. These two concerns had agreed to procure soda ash from suppliers selected
on the basis of offers which were being invited by means of public notice which
was issued on the same day as the Press Note. Then the Press Note concludes
that soda ash so imported would be stocked at convenient centres and sold in
accordance with the general directions that may be issued by the Government
from time to time. The sale price would be fixed by the Government on fo.r.
Port basis and the importer-stockists would be paid remuneration for their
services at the rate of 12 1/2% of the landed cost, additional profit, if any,
on the transaction being made over to Government. The Public Notice 710 which
was issued about the same time gives the relevant particulars in regard to the
import of soda ash and other commodities. Tenders were invited and cl. 4 of the
Public Notice shows that the offerer whose offer was accepted by the Chief
Controller of Imports would be required to enter into 'a contract of sale
within ten days of the acceptance of the offer with the importer-distributor
selected by the Government in that behalf, No doubt discretion was left to the
Chief Controller of Imports to reject any offer without assigning any reason.
Subject to the terms and conditions set out in the Notice, if a contract was
concluded, an import licence for the quantity contracted to be purchased would
be issued in favour of the buyer subject to such conditions as might be imposed
by the Government of India in that behalf.
It appears that, prior to 1953, import
licences were freely granted. In 1953, licences began to be granted to
established importers subject to certain conditions. It also appears that
Government decided from time to time the total quantity of the specified
commodity which should be imported. Then the extent of the business of the
applicant for licences during the prescribed period was taken into account and
the total amount of import was then distributed pro rata amongst the several
applicants. When it was found that even this method did not work
satisfactorily, the Government decided to canalise distribution but while
canalisation was introduced in this manner, tenders were invited for import
licences and they were considered on merits and licences granted to several
claimants. It may be that, if the I.C.I. and the Tata Oil Mills Co. Ltd., were
amongst the applicants for licences, their competitors in the line may have
found it difficult to fight with these two powerful rivals but that is very
different from saying that, by the method of canalisation, the Government had
introduced a monopoly in the import of the commodity in question. It is also
important to emphasize that the petitioner is not even an established importer.
He was granted a licence during the free period, and so it is difficult to
understand his grievance that a monopoly had been 711 created and that -he was
thereby deprived of his fundamental right to carry on his trade.. Government
found that the importers of soda ash resorted to malpractices leading to
speculation, and violent fluctuations, in prices of the commodity. It was open
to the Government, and indeed national interests made it their duty, to
intervene and regulate the distribution of the commodity in a suitable manner.
That is all that Government purported to do by the policy statement to which
objection has been taken by the petitioner. Besides, it is difficult to
entertain the argument from the present petitioner that the alleged monopoly
has affected his right to carry on trade. In substance no monopoly has been
created and the petitioner's application is entirely misconceived. The result
is the petition fails and must be dismissed with costs.
Petition No. 377 of 1955 is directed broadly
against orders of confiscation and sale passed by the relevant authorities and
the petitioner claims that an appropriate writ should be issued by this Court
calling upon the said authorities to forbear from giving effect to the said
orders. We have already mentioned the material facts in regard to the
confiscation of the consignments of soda ash of 100 tons and 20 tons
respectively which has given rise to all these proceedings. Now, the order
dated May 3, 1954, has been passed by the Controller of Imports and Exports for
Chief Controller of Imports and Exports and it communicates to the petitioner
the decision of the Chief Controller that no licence or customs clearance
permit would be granted to him against his application for and upto the
licensing period July 1953. The petitioner was, however, told that his
applications for January-June 1954 licensing period would be dealt with in the
normal course according to the policy contained in the Red Book. Then the order
adds that it had been decided that re-validation of the licences mentioned in
Annexure 'A' to the petitioner's advocate's letter on April 20, 1954, could not
be allowed. That is why the said licences were returned to the petitioner. It
is this latter part of the order by which the petitioner feels aggrieved and
against which the petitioner seeks remedy by the 7l2 present petition. The
petitioner's case is that, since he was granted licences which were to be alive
for one' year from February 13, 1952, the illegal seizure of the licence and
the unauthorised confiscation of the consignments in question caused
considerable. prejudice to him. The return of the licences is poor consolation
to the petitioner.
because the period during which the licences
were to operate had already expired. He, therefore, claims that the licences
should be revalidated in the sense that the period during which he can operate
upon those licences should be suitably extended. It is true that if the
relevant authorities were inclined to revalidate the licences in that sense, it
would have been open to them to do so. But it is difficult to understand now
the petitioner can invoke the jurisdiction of this Court under Art. 32 of the
Constitution for obtaining this relief. We do not propose to discuss this
matter elaborately because, in our opinion, the position in law is abundantly
clear. The authorities have found that, though the licences were obtained by
the petitioner in his name, he has been,trafficking in these licences, that
the, consignments had been ordered by another individual Messrs. N. Jivanlal &
Co., that the said individual holds no licence for import of soda ash and as
such the consignments received by the said individual are liable to be
confiscated. If the petitioner's grievance is that the view taken by the
appropriate authorities in this matter is erroneous, that is not a matter which
can be legitimately agitated before us in ,a petitition under Art.
32. It may perhaps be, as the learned
Solicitor-General suggested, that the petitioner may have a remedy by suit for
damages but that is a matter with which we are not concerned. If the goods have
been seized in accordance with law and they have been seized as a result of the
findings recorded by the relevant authorities competent to hold enquiry under
the Sea Customs Act, it is not open to the petitioner to contend that we should
ask the authorities to exercise discretion in favour of the petitioner and
allow his licences a further lease of life. Essentially the petitioner's
grievance is against the conclusions of fact reached by the relevant authorities.
If the said 713 conclusions cannot be challenged before us in the present writ
petition, the petitioner would obviously not be entitled to any relief of the
kind claimed by him. In the result, the petition fails and must be dismissed
with costs.
That leaves two more petitions filed by the
petitioner, Petitions Nos. 42 of 1956 and 46 of 1956. These petitions have been
argued before us by Shri Umrigar and, on behalf of the petitioner, Shri Umrigar
has raised three points before us. He contends that the Import-Export, Act does
not apply to soda ash and that it is every citizen's right to import and export
this commodity without a licence. If that be the true position, confiscation of
the two consignments would be illegal, and so, he wants an appropriate writ
from this Court against the Central Government. In the alternative, he argues
that the legislation which authorises the issue of licences amounts to a
delegated legislation and -as such' is invalid. Again, if legislation is
invalid on the ground' alleged, confiscation of the two consignments would be
invalid and the petitioner would be entitled to a writ.
Failing these two contentions, Shri Umrigar
argues that the conclusion of the relevant authorities that his client was
trafficking in licences is based on 'no legal evidence and must, therefore, be
reversed by this Court and appropriate relief given to him on the basis that
the petitioner had obtained licences bona fide for his own personal use and the
contrary view taken by the relevant authorities and the subsequent confiscation
of the consignments were illegal and ultra vires. We would now briefly deal
with these three points in the order in which they were urged before us by Shri
Umrigar.
The first argument is based upon the fact
that, while enacting The Imports and Exports (Control) Act, 1947, Act No. XVIII
of 1947, the provisions contained in r. 84 (2) of the Defence of India Rules
have not been included in the Act and the contention, which at best may be
characterised as ingenious, is that the object of omitting the said provisions
while enacting the subsequent Act of 1947 was to release, from the operation of
the Import Act, articles which would have fallen 714 under the said omitted
provisions. R. 84 of the Defence of India Rules by sub-r. (1) defines export
and import. ' Import " means bringing into British India by sea, land or
air. " Export " -means taking out of British India by sea, land or
air. Then sub-s. (2) provides:
" The Central Government may by a
notified order prohibit or restrict the import or export of all goods or goods
of any specified description, from or to any specified person or class of
persons Sub-r. (3) then provides:
" The Central Government may by notified
order make provision for prohibiting, restricting or otherwise controlling, in
all cases or in specified classes of cases, and subject to such exceptions, if
any, as may be made by or under the order,- (i) the import, export, carriage
coastwise or shipment as ships' stores of all goods or goods of any specified description;
(ii)the shipment of fresh water on seagoing
vessels ;
(iii)the bringing into any port or place in
British India of goods of any specified description intended to be taken out of
British India without being removed from the ship or conveyance in which they
are being carried." Shri Umrigar contends that the import 'of soda ash
could have been legitimately regulated under the provisions of r. 84, sub-r.
(2) but since this sub-rule has not been enacted under Act XVIII of 1947, all
regulations made by the Central Government and terms and conditions laid down
in regard to the granting of licences are ultra vires of the Act. Act XVIII of
1947 gives substantially the same meaning to the words " export " and
" import "' and the operative portion of the Act is contained in s. 3
which is the same as r. 84, sub-r. (3), of the Defence of India Rules. In order
to make his argument plausible, Shri Umrigar seeks to put a very narrow,
artificial and unreasonable restriction upon s. 3, sub-s. (1) (a) of Act XVIII of
1947. Before dealing with this argument, however, it would be convenient to set
out the said section as under:
715 " 3. Powers to prohibit or restrict
imports and exports :
(1)The Central Government may, by order
published in the official Gazette, make provision for prohibiting.
restricting or otherwise controlling, in all
cases or in specified classes of cases, and subject to such exceptions, if any,
as may be made by or under the order,- (a)the import, export, carriage
coastwise or shipment as ships' stores of goods of any specified description ;
(b)the bringing into any port or place in
India of goods of any specified description intended to be taken out of India
without being removed from the ship or conveyance in which they are being
carried.
(2) All goods to which any order under
sub-section (1) applies shall be deemed to be goods of which the import or
export has been prohibited or restricted under section 19 of the Sea Customs
Act, 1878 (VIII of 1878), and all the provisions of that Act shall have effect
accordingly, except that section 183 thereof shall have effect as if for the
word "shall" therein the word "may" were substituted.
(3) Notwithstanding anything contained in the
aforesaid Act, the Central Government may, by order, published in the official
Gazette, prohibit, restrict or impose conditions on the clearance, whether for
home consumption or for shipment abroad, of any goods or class of goods
imported into India." Shri Umrigar contends that s. 3 (1) (a) cannot apply
to the import of soda ash, because, according to him, it is only goods of a
specified description which are imported or exported, carried coastwise or
shipped as ships' stores that fall within the mischief of the said provision.
In other words, he reads the expression " carriage coastwise " and
",shipment as ships' stores " as constituting adjectival clauses
governing the words "import" and "export". In our opinion,
such a construetion is wholly unreasonable. We have no doubt that this provision
has to be read disjunctively and distributively, and so read, the import.
of goods of any specified descrip- 92 716
tion would attract the application of the said provision.
If we bear in mind the definition of the
words "import" and " export ", it would be obvious that
articles that are carried coastwise would never fall within the cate. gory of
either import or export. The assumption that the Legislature, wanted to release
all kinds of goods from the application of s. 3 (1) (a) is, in our opinion, so
completely inconsistent with, the plain and natural meaning of the material
clause that we have no hesitation in rejecting Shri Umrigar's argument. If the
words used in the clause are given their natural meaning, it is clear that the
Legislature must have felt, in enacting this Act, that it was unnecessary to
continue by reenactment the provisions of r. 84(2) in the present Act. What was
specifically provided in the said rule is in effect included in s. 3 (1) (a).
We must, therefore, hold that the argument that no licence was required for the
import of soda ash and so all the orders passed by the appropriate authorities
in regard to the confiscation of the consignments are invalid must fail.
The next argument is that the material
provision is ultra vires as it amounts to delegated legislation. The challenge
to the validity of legislative enactments on the ground of delegated
legislation often enough -presents problems which are not easy of solution. The
recent history of judicial decisions, however, shows that, though there is
considerable divergence of opinion in the approach to the question of dealing
with such a challenge, some principles may be said to be fairly well settled.
There is no doubt that legislation which is conditional, properly so-called,
must be distinguished from legislation which is delegated. Shri Umrigar
concedes that where the Legislature provides and lays down principles
underlying the provisions of a parti- cular statute and also affords guidance
for the implementation or enforcement of the said principles, it is open to the
Legislature to leave the actual implementation or enforcement to its chosen
delegate. The time when the provision should be implemented, the period during
which it should be implemented or the place where it should be applied can,
according to 717 him, in appropriate oases be validly left by the Legislature
to its delegate. He, however, contends that, in the impugned Act, the
Legislature does not lay down principle and gives no guidance to the delegate
while leaving the implementation of the statutory provisions to him and
consequently the validity of the legislative enactment suffers from a serious
infirmity on the ground that the Legislature has surrendered its legislative
power in favour of its delegate. In dealing with this narrow ground of challenge,
it would be necessary to consider the preamble and the material provisions of
the Act to find out whether questions of policy have been clearly decided by
the Legislature -and whether guidance has been given to the delegate in the
matter of implementing the provisions of the statute. Unfortunately for Shri
Umrigar his challenge to the validity of the impugned section under the Imports
and Exports Act is completely covered by the decision of this Court in
Harishankar Bagla v. The State of Madhya Pradesh(1). In this case, so. -3 and 4
of the Essential Supplies (Temporary Powers) Act, 1946, were attacked as ultra
vires on the ground of delegated legislation. This challenge was repelled. In
repelling the argument of delegated legislation, Mahajan Chief Justice who
delivered the judgment of the Court conceded that " the Legislature must
declare the policy of the law and the legal principles which are to control any
given cases and must provide a standard to guide the officials or the body in
power to execute the law". "The essential legislative function
", the judgment proceeds to add, " consists in the determination or
choice of the legislative policy and of formally enacting that policy into a
binding rule of conduct ". Then the learned Chief Justice referred to the
fact that the Legislature has laid down such a principle and that principle is
the maintenance or increase in supply of essential commodities and of securing
equitable distribution and availability at fair prices. It was held that the
principle was clear and it offered sufficient guidance to the Central
Government in exercising its powers under s. 3. In other words, in considering
the question as to (1) [1955] 1 S.C.R. 380.
718 whether guidance was afforded to the
delegate in bring. ing into operation the material provisions of the Act by
laying down principles in that behalf, the Court considered the statement of
the principles contained in the preamble to the Act as well as in the material
provisions of s. 3 itself.
This decision shows that if we can find a
reasonably clear statement of policy underlying the provisions of the Act
either in the provisions of the Act or in the preamble, then any part of the
Act cannot be attacked on the ground of delegated legislation by suggesting
that Questions of policy have been left to the delegate. Turning to the
impugned sections of the present Act, it is necessary to remember that the
present Act purports to continue for a limited period powers to prohibit or
control imports and exports which had already been enacted by the Defence of
India Act and the Rules framed there under. In other words, this Act does not
purport to enact the material provisions for the first time but it purports to
continue the previously existing provisions in that behalf and so it would be
legitimate to consider the preamble of the predecessor Act and relevant
provisions in it to find out whether the Legislature has laid down clearly the
policy underlying that Act and has enunciated principles for the guidance of
those to whom authority to implement the Act has been delegated.
The preamble to the present Act says that it
was expedient to continue for a limited period powers to prohibit, restrict or
otherwise control imports and exports. The preamble to the Defence of India Act
refers to the emergency which had arisen when the Act was passed and refer;,
inter alia, to the necessity to take special measures to ensure the public
safety and public interest. Section 2 of the said Act further provides that the
Central Government thought that it was essential to secure public safety and
maintenance of public order and, what is more relevant and material, the
maintenance of supplies and services essential to the life of the community.
Thus it is clear that the broad and main principle underlying the present Act,
like its predecessor, was to maintain supplies essential to the life of the
community. Thus, if the preamble 719 and the relevant section of the earlier
Act are read in the light of the preamble of the present Act, it would be difficult
to distinguish this Act from the Essential Supplies Act with which this Court
was concerned in Harishankar Bagla's case Incidentally, we may also observe
that in Pannalal Binjraj v. The Union of India (2), where the vires of. a. 5
(7-A) of the Income. Tax Act were put in issue before this Court, the challenge
was repelled and, during the-course of the judgment delivered on December 21,
1956, the previous history of the earlier Income-Tax Acts was taken into
account to decide what policy could be said to underlie the provisions of the
impugned section.
The last argument of Shri Umrigar is patently
untenable. No doubt Shri Umrigar began this argument by contending that the
finding made against the petitioner that he was trafficking in his licences and
that the consignments in question did not really belong to him was based on no
evidence but ultimately he could not help conceding the fact that there were
certain circumstances on which the appropriate authorities relied against the
petitioner. The contention that a finding made by a competent authority is
based on no legal evidence is easy to make but very difficult to establish.
Such a contention can succeed only when it is shown that there is really no
legal evidence in support of the view taken by the appropriate authorities.
In the present case, it is impossible to
accede to the assumption that there is no legal evidence against the
petitioner. His poor financial resources, his conduct at all material times
when consignments were ordered, the suspicions attaching to the very existence
of the firm Messrs. N. Jivanlal & Co. in Bombay and the prominent part
played by this firm at all stages of the transaction in regard to the
consignments as well as the reckless allegations which were made by the petitioner
before the authorities which were found to be untrue by the appropriate
authorities, cannot be summarily dismissed as being irrelevant or as not
constituting legal evidence. At the highest it may be said that there (1)
[1955] 1 S.C.R. 380.
(2) [1957] S.C.R. 233.
720 are some circumstances on which Shri
Umrigar wants to rely in favour of the bonafides of his client whereas there
is. a large number of circumstances against him. If all the appropriate
authorities, on considering these circumstances, concurrently found against the
petitioner, that obviously is not a matter which can be legitimately agitated
in the present petition. That is why we do not propose to deal with this aspect
of the matter any further. In the result, both Petitions Nos. 42 of 1956 and 46
of 1956 fail and must be dismissed with costs.
Petitions dismissed.
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