A.K. Jain & Ors Vs. Union of India
& Ors  INSC 152 (25 July 1969)
25/07/1969 HEGDE, K.S.
CITATION: 1970 AIR 267 1970 SCR (1) 673 1969
SCC (2) 340
RF 1974 SC1533 (21)
Essential Commodities Act, 1955, s.
3--Sugarcane (Control) Order 1955 Rule 3(3)---Offence if purchaser does not pay
price of sugarcane purchased, within 14 days--Validity of rule--Whether s. 3 of
Act deals with food crops or only with foodstuffs---Competence of Parliament to
pass s. 3--Effect of Bihar Sugar Factories Control Act, 1947--Fundamental right
under Art. 19(1) of Constitution whether affected by impugned rule--Offence
whether cognizable within meaning of s. 4(1)(f) Code of Criminal Procedure.
The appellants were the office bearers of a
sugar concern. A complaint with the police was registered against them under
sub-rule 3 of Rule'3 of the Sugarcane (Control) Order, 1955 read with s. 7 of
the Essential Commodities Act, 1955, On the ground that they had failed to pay
to the sellers within the time prescribed the price of the sugarcane purchased
by them. Objecting to the investigation of the alleged offence the appellants
filed a writ petition under Art. 226 of the Constitution but the High Court'
refused to interfere. By special leave they came to this Court. The contentions
urged on behalf of the appellants were (i) that sub-rule 3 of rule 3 could not
have been validly issued under s. 3 of the Essential Commodities Act because
the latter section applied only to foodstuffs and not to food crops (ii) that
the regulation of the price of sugarcane being expressly dealt with by the
Bihar Sugar Factories Control Act, 1937 the same power could not by implication
be spelt out from the provisions of the Order and the Act, (iii) that
Parliament had no competence to enact any law relating to the control of
sugarcane as that subject was within the exclusive legislative jurisdiction of
the State, the same being a part of agriculture. (iv) that there was violation
of the fundamental right under Art.
19(1) of the Constitution by the impugned
order. (v) that in view of s. 11 of the Act no cognizance could have been taken
of the offence, (vi) that the complaint made before the police did not disclose
a cognizabIe offence and as such the police was not empowered to investigate
HELD: (i) In view of the scheme of ss. 2 and
3 of the Act and the judgment of this Court in Ch. Tika Ramji's case the
contention that food crops were outside the purview of s. 3 of the Act must be
rejected. [675 B--G] Ch. Tika Ramji & Ors. v. State o/U.P. & Ors.
 S.C.R. 432, applied.
(ii) The power sought to be exercised in the
present case was not implied one for sub-rule (3) of rule 3 gives a specific
mandate that unless there is an agreement in writing to the contrary between
the parties the purchaser shall pay to the seller the price of the sugarcane
purchased within 14 days. [676 G-H] 674 Even if the Bihar Sugar Factories
Control, Act, 1937 provides anything to the contrary it must be held to have
been altered by a competent authority namely Parliament, under Art, 372 of the
Constitution. [677 A-B] (iii) Parliament was competent to enact the Essential Commodities
Act and to confer power on the Government under s. 3 of the Act as Entry 33 of
List III of the Constitution empowers Parliament to legislate in respect of
production, supply and distribution of foodstuffs. [677 C-D] (iv) There was no
contravention of Art. 19(1) because no fundamental right is conferred on a
buyer not to pay the price of the goods purchased by him or to pay the same
whenever he pleases. [677 E] (v) The plea based on s. 11 of the Act was
premature because no ,court had yet taken cognizance of the case. [677 F] (vi)
The offence complained of was punishable with three years' imprisonment and
fell within the 2nd Schedule of the Code of Criminal Procedure. It was
therefore a cognizable offence as defined in s. 4(1)(f) of the Code. [677 G]
CRIMINAL APPELLATE JURISDICTION: Criminal
Appeal No. 189 of 1966.
Appeal by special leave from the judgment and
order dated July 4, 1966 of the Patna High Court in Criminal W.J.C. No. 11 of
B.R.L. lyengar and U.P. Singh, for the
V. A. Seyid Muhammad and S.P. Nayar, for
respondent No. 1.
The Judgment of the Court was delivered by
Hegde J. This appeal against the decision of the High Court of Patna in
Criminal W.J.C. No. 11 of 1966 was brought after obtaining special leave from
this Court. The principal question raised herein is whether the investigation
which is being carried on against the 'appellants under sub-rule (3 ) of rule 3
of Sugarcane (Control) Order, 1955 (to be hereinafter referred to as the Order)
read with s. 7 of the Essential Commodities Act, 1955 (to be hereinafter
referred to as the Act) is in accordance with law.
The appellants are office bearers of M/s.
S.K.G. Sugar, Ltd.(Lauriya). A complaint has been registered against them under
sub-rule (3) of rule 3 of the Order read with s. 7 of the Act on the ground
that they have failed to pay to the sellers the price of the sugarcane
purchased by them, within the time prescribed. The said complaint is being
investigated. The appellants are objecting to that investigation on various
grounds. They unsuccessfully sought 'the intervention of the High Court of
Patna under Art. 226 of the Constitution in Cr. W.I.C. No. 11 of 1966.
Hence this appeal.
675 Mr. B.R.L. Iyengar appearing for the
appellants challenged the validity of the investigation in question on various
grounds. We shall now proceed to deal with each one of those grounds.
The 1st contention of Mr. Iyengar was that
sub-rule (3) of rule 3 could not have been validly issued under s. 3 of the
Act. According to him the said s. 3 cannot be used for controlling the payment
of the price of food crops; it can only deal with foodstuffs; food crops are
outside its scope.
This contention has been negatived by the
High Court. We agree with the High Court that there is no merit in this
contention. Section 2(a) of the Act defines "essential commodity".
Sub-cl. (v) of that clause brings.. foodstuffs within the definition of
essential commodity. Clause (b) of s. 2 provides that food-crops include
sugarcane. The next important provisions in the Act are cls. (b) and (c) of s. 3(1).
Section 3 (1 ) provides that if the Central Government is of opinion, that it
is necessary or expedient so to do for maintaining or increasing supplies of
any essential commodity or for securing their equitable distribution and
availability at fair prices, it may, by order, provide for regulating or
prohibiting the production,. supply and distribution thereof and trade and commerce
therein. Sub-s. (2)of that section says that without prejudice to the.
generality of the _powers conferred by sub-s.
(I ) an order made. There under may provide .....
"(b) for bringing under cultivation any
waste or arable land, whether appurtenant to a building or not, for the growing
thereon of food-crops generally or of specified food- crops, and for otherwise
maintaining or increasing' the cultivation of food-crops generally, or of
specified food-crops;" Clause (c) provides for controlling the price at
which any essential commodity may be bought or sold. From the scheme of cls.
(b) and (c) of s. 2 and s. 3 of the Act, it is clear that the Parliament
intended to bring under control the cultivation and' sale of food-crops. In
view of these provisions it is idle to contend that sugarcane does not come
within the ambit of the Act. The question whether the cultivation and sale of
sugarcane can be regulated under s. 3 of the Act came up for the consideration
of this Court in Ch. Tika Ramji and Ors. etc. v. The State of U.P. and Ors.(1)
At pages 432 and 433 of the report it is observed :
"Act X of 1955 included within the
definition of essential commodity foodstuffs which we have seen above would
include sugar as well as sugarcane. This Act was enacted by Parliament in
exercise. of' the con- (1)  S.C.R. 432.
676 current legislative power under' Entry 33
of List III as amended by the. Constitution Third Amendment Act, 1954.
Foodcrops were there defined as including
crops of sugarcane and section 3 (1 ) gave the Central Government powers to
control the production, supply and distribution of essential commodities and
trade and commerce therein for maintaining or increasing the supplies thereof
or for securing their equitable distribution and availability at fair prices.
Section 3(2)(b) empowered the Central
Government to provide inter alia for bringing under cultivation any waste or
arable land whether appurtenant to a building or not for growing thereon of food
crops generally or specified food crops and section 3(2)(c) gave the Central
Government power for controlling the price at which any essential commodity may
be bought or sold. These provisions would certainly bring within the scope of
Central legislation the regulation of the production of sugarcane as also the
controlling of the price at which sugarcane may be bought or sold, and in
addition to the Sugar Control Order, 1955 which was issued by the Central
Government on 27th August, 1955, it also issued the Sugarcane Control Order,
1955, on the same date investing it with the power to fix the price of
sugarcane and direct payment thereof as also the power to regulate the movement
Parliament was well within its powers in
legislating in regard to sugarcane and the Central Government was also well
within its powers in issuing the Sugarcane Control Order, 1955 in the manner it
did because all this was in exercise of the concurrent power of legislation
under Entry 33 of List III." It is needless to say anything more on this
It was next contended by Mr. Iyengar that the
regulation of the price of sugarcane is expressly dealt with by the Bihar Sugar
Factories Control Act, 1937 and therefore we should not impliedly spell out the
same power from the provisions of the Order and the Act. Mr. Iyengar is not
right in contending that the power that is sought to be exercised in the
instant case is an implied one. Sub-rule (3) of rule 3 specifically provides
that unless there is an agreement in writing to the contrary between the parties
the purchaser shall pay to the seller the price of the sugarcane purchased
within 14 days from the date of the delivery of the sugarcane. This is a
.specific mandate. If the Bihar Act provides anything to the contrary the same
must be held to have been 677 altered in view of Art. 372 of the Constitution
which provides that all laws in force in the territory of India immediately
before the commencement of this Constitution shall continue in force therein
until altered or repealed or amended by a competent legislature or other
competent authority. Quite clearly the Bihar Act is a pre- Constitution Act and
it could have continued to be in force only till it was altered, repealed or
amended by a competent legislature or other competent authority. We shall presently
see that the authority that altered or amended that law is a competent one.
The next contention of the learned Counsel
for the appellants was that the Parliament had no competence to enact any law
relating to the control of sugarcane as that subject is within the exclusive
legislative jurisdiction of the State, the same being a part of agriculture.
This contention is again unsustainable in view of Entry 33 of List III of the
Constitution which empowers the Parliament to legislate in respect of production,
supply and distribution of foodstuffs. It is not disputed that the Parliament
had declared-by law that it is expedient in public interest that it should
exercise control over foodstuffs. That being so it was well within the
competence of Parliament to enact the Act and hence the power conferred on the
Government ,under s. 3 of the Act cannot be challenged as invalid.
There is no substance in the contention that
the impugned order contravenes the fundamental right guaranteed to the citizens
under Art. 19 (1 ). No fundamental fight is conferred on a buyer not to pay the
price of the goods purchased by him or to pay the same whenever he pleases.
The contention that in view of s. 11 of the
Act, no cognizance could have been taken of the offence alleged is premature.
This question does not arise in this ease. No court has yet taken cognizance of
the case. That stage has Still to come.
There is no substance in the contention that
the complaint made before the police does not disclose a Cognizable offence and
as such the police could not have taken up the investigation of that complaint.
The offence complained of is punishable with three years' imprisonment and as
such it falls within the 2nd Sch. of the Cr. P.C. and consequently the same is
a cognizable offence as defined in s. 4(1)(f) of the Cr. P.C. Hence it was open
to the police to investigate the same.
For the reasons mentioned above we are unable
to accept any of the contention advanced on behalf of the appellants.
In the result this appeal fails and the same
G.C. Appeal dismissed.