Pan Masala Products I.P. Ltd. & Anr Va. Union of India & Ors  Insc 420 (2 August 2004)
K.G. Balakrishnan & B.N. Srikrishna. (arising out of SLP (C) No. 24449 of 2002) With Civil Appeal No. 4677 /2004
@ SLP (C) No.23635/02, Civil Appeal No. 4676 /2004 @ SLP (C) No.24292/02, Civil
Appeal No. 4675 /2004 @ SLP (C) No. 533/03, Civil Appeal No. 4678/2004 @ SLP
(C) No. 834/03, Civil Appeal No. 4679 /2004 @ SLP (C) No. 2186/03 And Writ
Petition (C) No. 173 of 2003 SRIKRISHNA, J.
Leave granted in the special leave petitions and the writ petition is
These appeals and writ petition arise from different areas and, though
marginally differing on facts, raise substantially similar issues of law. They
can, therefore, be conveniently disposed of by a common judgment.
The common issue raised for consideration of this Court in all these cases
is the validity of notifications issued by the Food (Health) Authority under
Section 7(iv) of the Prevention of Food Adulteration Act, 1954 (hereinafter
referred to as the 'Act') by which the manufacture, sale, storage and
distribution of pan masala and gutka (pan masala containing tobacco) were
banned for different periods. We shall take the facts in the civil appeal
arising out of special leave petition No. 24449 of 2002 as typical of the
Civil Appeal arising out of SLP(C) No. 24449 of 2002 The appellants
manufacture gutka within the state of Maharashtra, which is stored in
convenient godowns and sold both within and outside the state of Maharashtra.
By a notification dated 23rd July, 2002 issued by the Commissioner, Food and
Drug Administration and Food (Health) Authority for the State of Maharashtra,
the manufacture, sale, storage and distribution of pan masala and gutka (pan
masala containing tobacco) were banned for a period of five years with effect
from 1st August, 2002. The appellants challenged the validity of this
notification by a writ petition No. 2024 of 2002 before the High Court of
Judicature at Bombay. By its judgment dated 18th /19th September, 2002, the division bench of the Bombay High Court dismissed the writ petition upholding the
validity of the notification.
Aggrieved thereby, the appellants challenge the said judgment by the present
Writ Petition No. 173 of 2003:
Petitioners Nos. 1 to 5 are associations and cooperative societies of
arecanut growers, petitioners Nos. 6 and 7 are engaged in the manufacture and
sale of pan masala and gutka in the State of Karnataka. They are aggrieved by a
notification dated 27th February, 2002, issued by the competent officer
appointed as Food (Health) Authority for the State of Andhra Pradesh under
Section 7(iv) of the Act, by which the sale of all brands of pan masala
(containing tobacco) and chewing tobacco/ zarda/ khaini under any brand name
was prohibited "in the interest of public health" in the entire state
of Andhra Pradesh with immediate effect.
The petitioners also challenge another notification dated 19th November,
2001 issued by the Director for Public Health and Preventive Medicine and State
Food (Health) Authority, Government of Tamil Nadu, under Section 7(iv) of the
Act directing that no person shall himself or by any person on his behalf,
manufacture for sale or store, sell or distribute: (i) chewing tobacco; (ii)
pan masala; (iii) gutka, containing tobacco in any form or any other
ingredients injurious to health, under whatever name or description in the
State of Tamil Nadu. This notification is purported to have been issued in the
"interest of public health", for a period of five years with effect
on and from 19th November, 2001.
The third notification which is challenged in the writ petition is the
notification dated 23rd July, 2002 issued by the Commissioner of Food and Drug
Administration and Food (Health) Authority for the State of Maharashtra. By the
said notification, issued purportedly in exercise of the powers under Section
7(iv) of the Act, "in the interest of public health", the sale of
gutka and pan masala, containing tobacco or not containing tobacco, is prohibited
for a period of five years effective from 1st August, 2002. The notification directs that "no person shall himself or any person on his behalf,
shall manufacture for sale or store, sell or distribute gutka or pan masala,
containing tobacco or not containing tobacco, by whatever name called.
The fourth notification challenged in the writ petition is the notification
dated 24th January, 2003 issued by the Directorate of Food and Drugs
Administration and Food (Health) Authority for the State of Goa. By this
notification, purportedly issued under Section 7(iv) of the Act, the "sale
of gutka and pan masala, containing tobacco or not containing tobacco, by
whatever name called," is prohibited within the state of Goa and it is
directed that "no person shall himself or any person on his behalf, shall
manufacture for sale or store, sell or distribute gutka or pan masala,
containing tobacco or not containing tobacco, by whatever name called."
The prohibition in the notification is made effective from 26th January, 2003.
All the four notifications are under challenge.
Civil Appeals arising out of S.L.P. Nos. 23635/02, 24292/02, 533/03, 834/03
and 2186/03 The appellants are engaged, inter alia, in the manufacture and
trade of pan masala and gutka, pan masala containing tobacco and other allied
tobacco products. They sell their products all over India including State of Maharashtra.
They have a wide network of dealers through whom their products are sold to the
public at large in the state of Maharashtra. They also have operating depots in
the state of Maharashtra. The appellants challenge the notification dated 23rd July, 2002, issued by the Commissioner, Food and Drug Administration and Food
(Health) Authority for the state of Maharashtra. The High Court by its common
judgment dated 18th/19th September, 2002 negatived the challenge.
Civil Appeal arising out of SLP No. 24292 of 2002 The appellant carry on the
business of manufacture and sale of pan masala, gutka and other tobacco related
items. Aggrieved by the notification dated 19th February, 2002 issued by the
Food (Health) Authority, State of Andhra Pradesh, prohibiting the sale of pan
masala under any brand name with a emblem of gutka, containing tobacco, within
the state of Andhra Pradesh, with immediate effect, and the notification dated
27th February, 2002 issued by the same authority which prohibited the sale of
all brands of pan masala containing tobacco and chewing tobacco/zarda/khaini
under any brand name in the entire State of Andhra Pradesh, with immediate
effect, the appellant challenged the validity of both notifications before the
High Court of Andhra Pradesh. The division bench of the high court by its
judgment dated 16th August, 2002 dismissed the writ petition. Being aggrieved
thereby, the appellant is before this Court.
These appeals and the writ petition raise the common issue as to the power
of the Food (Health) Authority to issue an order of prohibition, whether
permanently or quasi-permanently, under Section 7(iv) of the Act.
The broad grounds of challenge formulated by the appellants/petitioners are
1. The Act vests the power to declare a substance as injurious to health
only with the Central Government under Section 23 of the Act and no such power
is vested with the State Government.
2. Each of the manufacturers has been issued a licence to manufacture the
banned product by the Central Government under the provisions of the Act. As
long as the conditions stipulated in the licence are fulfilled, and there is no
violation of the terms of the licence or the provisions of the concerned
statute, it is not open to the state Government, by any administrative order,
to prohibit the manufacture of the concerned product undertaken under a licence
issued by the Central Government.
3. The power of the State Government to frame rules under Section 24 of the
Act is extremely narrow and limited to the field which is not covered by
Section 23, the exclusive domain of the Central Government.
4. The Act is concerned with the prevention of adulterated articles of food
and not intended to prohibit any article used as food or otherwise.
5. The impugned notification dated 23rd July, 2002, issued by the State of
Maharashtra operates extra territorially, and, to that extent, is ultra vires
of the powers of the State.
6. By enacting the Cigarettes and Other Tobacco Products (Prohibition of
Advertisement and Regulation of Trade and Commerce, Production, Supply and
Distribution) Act, 2003, (Act 34 of 2003), Parliament has evinced its intent to
occupy the whole field with regard to prohibition of advertisement and
regulation of trade and commerce, production, supply and distribution of
tobacco products. While the central legislation prohibits the sale of tobacco
products only to persons below age of 18 years, the impugned notification
purports to impose a wholesale ban without any qualification. Thus, there is a
conflict between the powers exercisable under two central statutes dealing with
the same subject and, therefore, provisions of the Act 34 of 2003 must prevail.
In order to appreciate the contentions of the learned counsel, it will be
necessary to briefly notice the relevant provisions of the Act. As the preamble
of the Act indicates, "it is an Act to make provision for the prevention
of adulteration of food." Section 2(ia) defines what is 'adulterated
food'. Broadly speaking, the definition covers situations where a food article
is sub-standard, or contains injurious ingredients or has become injurious to
health by reason of packing or keeping under unsanitary conditions or having
become contaminated or is otherwise not fit for consumption. The definition
also extends to cases of articles which fall below the prescribed standards of
purity or quality. The Act also deals with misbranding of food articles, which
is not of concern to us for the present.
For the purpose of administration of the Act, any urban or rural area may be
declared by the Central Government or the State Government by a notification to
be a 'local area' for the purpose of the Act. In relation to such local area,
an officer is appointed by the Central Government or the State Government by
notification in the Official Gazette to be in-charge of the Health
administration in such area with such designation as specified therein and such
officer is defined to be a 'Local (Health) Authority' by Section 2(viiia).
Section 2(vi) defines 'Food (Health) Authority' as the Director of Medical and
Health Services or the Chief Officer in-charge of Health administration in a
State, by whatever designation he is known, and includes any officer empowered
by the Central Government or the State Government, by notification in the
Official Gazette, to exercise the powers and perform the duties of the Food
(Health) Authority under the Act with respect to such local area as may be
specified in the notification. Section 7, upon which most of the arguments
turn, needs to be noticed. Section 7 reads as under:
"7. Prohibitions of manufacture, sale, etc., of certain articles of
food. - No person shall himself or by any person on his behalf manufacture for
sale, or store, sell or distribute - (i) any adulterated food;
(ii) any misbranded food;
(iii) any article of food for the sale of which a licence is prescribed,
except in accordance with the conditions of the licence;
(iv) any article of food the sale of which is for the time being prohibited
by the Food (Health) Authority in the interest of public health;
(v) any article of food in contravention of any other provision of this Act
or of any rule made thereunder; or (vi) any adulterant.
Explanation.-For the purposes of this section, a person shall be deemed to
store any adulterated food or misbranded food or any article of food referred
to in clause (iii) or clause (iv) or clause (v) if he stores such food for the
manufacture therefrom of any article of food for sale." Section 22A
empowers the Central Government to give such directions as it may deem
necessary to a State Government regarding the implementation of the Act.
Section 23 empowers the Central Government to make rules to carry out the
provisions of the Act. In particular, and without prejudice to the generality
of the rule making power, the power of the Central Government includes the one
in clause (f). Section 24 of the Act is the section which grants rule making
power to the State Government. The State Government may, after consultation
with the Committee, and subject to the condition of previous publication,
thereunder make rules for the purpose of giving effect to the provisions of the
Act in matters not falling within the purview of section 23. Sub section (2) of
Section 24 grants power to the State Government to make rules with regard to
the powers and duties of the different authorities under the Act.
Prescription of forms of licences for the manufacture for sale, storage,
sale and distribution of articles of food, the conditions subject to which such
licences may be issued and the fees payable therefor, analysis of any article
of food or matter and provision for further delegation of power by the State
Government to the Food (Health) Authority or the subordinate authorities are
the matters covered within this delegated power.
Part IX of the Prevention of Food Adulteration Rules, 1955 (hereinafter
referred to as the 'Rules') deals with the conditions for sale and licence.
Rules 49 and 50 lay down detailed conditions applicable to different types of
licences granted for manufacturing of different products used as food articles.
In Appendix B there is prescription of definitions and standards of quality
of different food articles. Of relevance to us is paragraph A.30 which deals
with pan masala. Paragraph A.30 reads thus:
"A.30 PAN MASALA means the food generally taken as such or in
conjunction with pan, it may contain- Betelnut, lime, coconut, catechu,
saffron, cardamom, dry fruits mulathi, sabermusa, other aromatic herbs and
spices, sugar, glycerine, glucose, permitted natural colours, menthol and non-
It shall be free from added coaltar colouring matter, and any other
ingredient injurious to health.
It shall also conform to the following standards, namely:- Total ash.-Not
more than 8.0 per cent by weight (on dry basis).
Ash insoluble in dilute hydrochloric acid.-Not more than 0.5 per cent by
weight (on dry basis)." Significantly, in this specification of standard
the prescription is that the article is "free from added coaltar colouring
matter, and any other ingredient injurious to health". It is also required
to conform to the prescribed standard with regard to total ash.
As far as the rules made by the State Government are concerned, the
Maharashtra Prevention of Food Adulteration Rules, 1962 and the Goa, Daman and
Diu Prevention of Food Adulteration Rules, 1982 may be noticed. The relevant
Goa rules are as under:
"3. Powers and duties of Food (Health) Authority:
(1) The Director of Health Services for the Union Territory of Goa, Daman
and Diu being the Chief Officer in charge of the Health Administration in the
Union Territory shall be the Food (Health) Authority.
(2) The Food (Health) Authority shall be responsible for the general
superintendence of the administration and enforcement of the Act.
(3) The Food (Health) Authority shall, for the purpose of giving effect to
the provisions of the Act, have control over the Public Health Laboratories
maintained by the Government and Local Authorities and Local (Health)
Authorities, Licensing Authorities, the Public Analyst and Food Inspectors
appointed under the Act.
(4) The Food (Health) Authority may give to a Local (Health) Authority such
directions as he may consider necessary in regard to any matter connected with
the enforcement of the Act and the Rules made thereunder and the Local (Health)
Authority shall comply with such directions.
(5) The Food (Health) Authority whenever called upon to do so shall advise
the Government in matters relating to the administration and enforcement of the
(6)(a) If the Union Territory or any part thereof is visited by, or
threatened with any outbreak of any infectious diseases, the Food (Health)
Authority shall ascertain the cause of such outbreak of the infectious disease.
(b) If in the opinion of the Food (Health) Authority the outbreak of any
infectious disease is due to any article of food, the Food (Health) Authority
shall take such measures as it shall deem necessary to prevent the outbreak of
such disease or the spread thereof.
(7) The Food (Health) Authority may issue from time to time guidelines for
the efficient working of the Act.
(8) The Food (Health) Authority may from time to time issue guidelines to
the Public Analyst for efficient working of the Act.
(9) The Food (Health) Authority may also have powers to inspect, control and
superintend the operation of other functionaries working under the Act viz.
Licensing Authority, Local Authority etc. etc.
4. Powers and duties of Local (Health)Authority:
(1) Subject to the provisions of sub-rule (3), the Local (Health) Authority
shall be responsible for the proper day to day administration and enforcement
of the Act and the Rules within its jurisdiction.
(2) The Local (Health) Authority or Health Officer/Medical Officer
authorised by it shall be the Licensing Authority for local area concerned.
(3) The Local (Health) Authority or Health Officer/Medical Officer/Food
Inspector authorised by it shall have powers to inspect all the establishments
engaged in the manufacture, for sale or for distribution of articles of food in
respect of which a licence is required under the Act and the Rules.
5. Licences :
(1) Any person desiring for the manufacture for sale, for the storage, for
the sale or for the distribution of articles of food in respect of which a
licence is required under Rule 48A and Rule 50 of the Central Rules, shall
apply for a licence in Form A to the Licensing Authority concerned.
(2) Any person desiring for the manufacture for sale, for the storage, for
the sale or for the distribution of articles of food in a mobile van shall
apply in Form B to the Licensing Authority and if such mobile van is to move in
any one or more than one local area to the Local (Health) Authority, District
(3) The applicant shall furnish in the application in Form A detailed
information regarding location of the business premises which are intended for
the manufacture for sale, for the storage, for the sale or for the distribution
of any article of food and in Form B the details about the locality in which,
the mobile van is intended to be moved and its registration number issued by
the Road Transport Authority.
(4) On receipt of such application, the Licensing Authority shall, if on
inspecting the said premises is satisfied that the premises are free from
sanitary defects and are in proper hygienic conditions and the applicant
complies with other conditions for holding licence, grant the applicant a
licence in Form as specified below on payment of fees laid down in the Schedule
appended to the rules.
(i) Form 'C' in respect of any premises.
(ii) Form 'D' in respect of any mobile van.
(iii) Form 'E' in respect of any temporary stall.
(5) If the information furnished in the application appears to be incorrect
or incomplete or if the prescribed fee has not been paid, the Licensing
Authority shall make such enquiry as he considers necessary and after giving
the applicant an opportunity of proving the correctness and completeness of the
information so furnished, may if he is satisfied that the applicant is eligible
for the licence applied for grant or renew the licence.
(6) If the articles of food are manufactured, stored or exhibited for sale
at different premises situated in more than one local area, separate
applications shall be made and a separate licence shall be issued in respect of
such premises not falling within the same local area.
Provided that the itinerant vendors who have no specified place of business,
shall be licensed to conduct business in a particular area within the
jurisdiction of the Licensing Authority.
(7) The licensee shall abide by the provisions of the Act and the Rules made
thereunder and the conditions of licence granted to him.
6. Fees for grant and renewal of licences:
The fees to be paid for the grant or renewal of licence shall be as
specified in the Scheduled appended to the Rules.
7. Validity of licence:
A licence granted under these rules shall be valid for the period beginning
on the date of its issue and ending on 31st day of March, next following.
8. Renewal of licences :
A licence granted under the rules may be renewed by the Licensing authority
on an application made in that behalf, thirty days before the day on which such
licence is due to expire and on payment of fees specified in the Schedule.
Provided that, if the application for renewal is made after the expiry of
the licence but not later than one month from the date of such expiry, the
licence may be renewed only on payment of a fee equal to one and half times of
the fee payable for the renewal of the licence.
9. Conditions for grant or renewal of licences :
The Licensing Authority shall not grant or renew the licence until such
officer as may be specified by him by general or special order has inspected
the place in respect of which the licence for grant or renewal is applied for
and has recommended the grant or renewal of the licence. The Licensing
Authority shall however use his own judgment in granting/renewal of
licences." Rule 13 deals with the circumstances under which the Licensing
Authority may by order in writing refuse to grant or renew a licence. Rule 14
prescribes the procedure for cancellation or suspension of the validity of a
licence. Rule 15 gives a right to appeal to any person aggrieved by an order of
the Licensing Authority passed under rule 13 or rule 14.
The relevant rules of the Maharashtra Prevention of Food Adulteration Rules,
1962 are as under:
"3. Food (Health) Authority and its powers and duties - (1) The
Director of Public Health for the State of Maharashtra being the Chief
Officer-in-charge of the Health Administration in the State of Maharashtra
shall be the Food (Health) Authority (hereinafter referred to as the
(2) The authority shall be responsible for the general superintendence of
the administration and enforcement of the Act.
(6)(a) If the State or any part thereof is visited by, or threatened with an
outbreak of any infectious disease, the authority shall ascertain the cause of
such outbreak of the infectious disease.
(b) If in the opinion of the authority the outbreak of any infectious
disease is due to any article of food, the authority shall take such measures
as it shall deem necessary to prevent the outbreak of such disease or the
spread thereof." Rule 5 deals with licences and the manner of suspension
or cancellation of licences.
Ex visceribus actus:
The first contention urged on behalf of the appellants is that Section 7 of
the Act is not declaratory of the power of any authority, but merely of the
consequences of certain acts. The section prohibits the manufacture for sale,
store or distribution of (i) any adulterated food; (ii) any misbranded food;
(iii) any article of food for the sale of which a licence is prescribed, except
in accordance with the conditions of the licence; (iv) any article of food the
sale of which is for the time being prohibited by the Food (Health) Authority
in the interest of public health; (v) any article of food in contravention of
any other provision of this Act or of any rule made thereunder; or (vi) any
adulterant. Although, Section 2(vi) defines as to who is a Food (Health)
Authority, there is no corresponding provision in the Act which delineates the
powers of the Food (Health) Authority. On the other hand, Section 24(2) of the
Act empowers the State Government to "define the powers and duties of the
Food (Health) Authority, local authority and Local (Health) Authority under
this Act". The source of the powers of the Food (Health) Authority is to
be found only under the rules, if any, made under Section 24(2) of the Act,
subject to the restriction that it can be made only "for the purpose of
giving effect to the provisions of this Act in matters not falling within the
purview of Section 23".
Learned counsel for the appellants contend that in view of the nature of the
limitations placed on the State Government's power under Section 24(1), a reading
of Sections 23 and 24 would lead to the irresistible conclusion that the powers
exercisable by the State Government under Section 24 can only be in the field
not occupied by Section 23. As we have already noticed, Section 23(1A)(f)
empowers the Central Government to prescribe rules for prohibiting the sale or
defining the conditions of sale of any substance which may be "injurious
to health" when used as food or restricting in any manner its use as an
ingredient in the manufacture of any article of food or regulating by the issue
of licences the manufacture for sale of any article of food. Learned counsel,
therefore, contend that the power of the Food (Health) Authority has to be
necessarily found under the rules made by the State Government and subject to
the limitation that they cannot operate in the field covered by Section 23.
Since Section 23(1A)(f) empowers the Central Government to make rules for
prohibition of any substance which may be injurious to health, it is contended
that the state Food (Health) Authority is denuded of such power.
There appears to be merit in the contentions of the appellants. Rule 3 of
the Maharashtra Prevention of Food Adulteration Rules, 1962 and the
corresponding rule in the Goa, Daman & Diu Prevention of Food Adulteration
Rules, 1982 suggest that the power given to the Food (Health) Authority is only
a pro tem power to deal with an emergent situation, such as outbreak of any
infectious disease, which may be due to any article of food. In such a
contingency, the Food (Health) Authority is empowered to take all such action
as it deemed necessary to ascertain the cause of such infectious disease and to
prevent the outbreak of such disease or the spread thereof. Certainly, such
power would include the power to ban "for the time being" the sale of
such injurious articles of food. Hence, correspondingly Section 7(iv) of the
Act provides that no person shall manufacture for sale, or store, sell or
distribute "any article of food the sale of which is for the time being
prohibited by the Food (Health) Authority in the interest of public
health." In other words, when a contingency envisaged by Rule 3, or one
similar thereto, arises and it becomes necessary for the Food (Health)
Authority to take immediate steps, the Food (Health) Authority is empowered to
prohibit "for the time being" the concerned injurious article and to
take any appropriate step "in the interest of public health".
On the collocation of the statutory provisions, we are unable to accept the
contention of the learned counsel for the States that clause (f) of Section 7
of the Act is an independent source of power. This conclusion of ours is also
supported by the legislative history. Prior to the amendment by Act 49 of 1964,
with effect from 1.3.1965, clause (iv) of Section 7 read as under:
"Any article of food the sale of which is for the time being prohibited
by the Food (Health) Authority with a view to preventing the outbreak or spread
of infectious diseases." Learned counsel for the State Governments contend
that as a result of the amendment and the substitution of the words "in
the interest of public health" for the words "with a view to
preventing the outbreak or spread of infectious diseases", the legislature
has expanded the power of Food (Health) Authority so that it can act to
prohibit the sale of any article, the only limitation being that the power
exercised is "in the interest of public health". It is not possible
for us to accept this submission. It is, undoubtedly, true that the intention of
Parliament in bringing forth the amendment to clause (iv) of Section 7 was to
expand the area of operation of the said clause. As originally intended, it was
to operate only in the event of a contingency aimed at preventing the outbreak
or spread of infectious diseases. This certainly was restricted. There could be
several situations in which there may not be any apprehension of outbreak or
spread of infectious diseases and yet it may become necessary for the Food
(Health) Authority to act by taking appropriate steps to control a situation
which has arisen. It is with this view that the prohibition in clause (iv) of
Section 7 of the Act was expanded to apply to such contingencies also.
It is unfortunate that, despite the amendment made in clause (iv) of Section
7 of the Act, (by Act 49 of 1964) the rules have not been correspondingly
updated. Going strictly by the state rules, which actually determine the extent
of the power of the Food (Health) Authority, it appears to us that the
arguments of the State Governments that this amendment was intended to give a
carte blanche to the Food (Health) Authority cannot be accepted. On the
contrary, the construction canvassed by the appellants appears to be more
reasonable. We are inclined to the view that the power of the state authority,
which is discernible under Section 24(2)(a) read with the state rules, operates
only for a temporary period during which an emergent situation exists which
needs to be controlled. It is not possible to accept the State Governments'
contention that clause (iv) of Section 7 of the Act is an independent provision
which clothes the Food (Health) Authority with the power to issue an order of
ban for a long period.
Mr. Lalit, learned counsel for the state of Maharashtra, took us through the
affidavit filed by the state Government and the voluminous data presented
therein by the state to indicate that gutka and pan masala are addictive and,
in the long run, deleterious to human health. He also referred to certain
scientific reports on the subject by the National Toxicology Centre, an
International Agency for Research on Cancer, part of the World Health
Organisation, and so on. In our view, it is not necessary to make any
pronouncement thereupon. Even if we accept that the scientific data supports
the view that chewing of pan masala with or without tobacco is injurious to
health, the question which remains to be answered is whether the Food (Health)
Authority in the state has the power of prohibiting the manufacture for sale,
or storage, sale or distribution of any article assuming it to be injurious to
health. A contrast of the powers of the Central Government with those of the
state Government, with particular reference to the power of the Central
Government to make rules to prohibit the manufacture, sale and distribution of
such articles which are injurious to health when used as food, enumerated in
clause (f) of sub- section(1A) of Section 23 of the Act, leads us to believe
that, even assuming that gutka and tobacco products are injurious to health, the
power of their prohibition is only vested with the Central Government and not
with the state Food (Health) Authorities. The State (Food) Health authorities
have only a limited power of issuing an order of prohibition for a short term
while they investigate local problems and take appropriate measures to control
the situation. Beyond that, the state authorities have no power as urged by the
learned counsel for the state Governments and as accepted in the impugned
judgment of the Bombay High Court.
It is an accepted canon of Construction of Statutes that a statute must be
read as a whole and one provision of the Act should be construed with reference
to other provisions of the same act so as to make a consistent, harmonious
enactment of the whole statute. The court must ascertain the intention of the
legislature by directing its attention not merely to the clauses to be
construed, but to the scheme of the entire statute. The attempt must be to
eliminate conflict and to harmonise the different parts of the statute for it
cannot be assumed that Parliament had given by one hand what it took away by
the other. [See in this connection Commissioner of Income Tax v. Hindustan Bulk
Carriers and C.I.T. Central, Calcutta v. National Taj Traders .] This Court in
O.P. Singla and Anr. v. Union of India and Ors. (vide para 17), said:
"However, it is well recognised that, when a rule or a section is a part
of an integral scheme, it should not be considered or construed in isolation.
One must have regard to the scheme of the fasciculus of the relevant rules or
sections in order to determine the true meaning of any one or more of them. An
isolated consideration of a provision leads to the risk of some other inter-
related provision becoming otiose or devoid of meaning." Against the
background of these principles, it is not possible to agree with the view taken
by the High Court that Section 7(iv) of the Act is an independent source of
power of such amplitude as held. In our view, the power of the state under
Section 7(iv) of the Act is statutory; absolute to the extent provided therein,
and limited to the extent indicated by Section 23(1A) of the Act.
Learned counsel for the appellants urged that the expression "for the
time being" used in clause (iv) of Section 7 of the Act is significant and
indicates the transient nature of the power that is conferred on the Food
(Health) Authority under the rules to ban or otherwise take any other
appropriate action in relation to an article of food even if it be "in the
interest of public health". This too lends support to their contention.
Learned counsel for the state of Maharashtra and the learned Advocate
General for the state of Goa relied on the judgments of this Court in Pukhraj
Jain v. Padma Kashyap and Anr. and Jivendra Nath Kaul v. Collector/District
Magistrate and Anr. to contend that the expression "for the time
being" would suggest the time period for which the order is in force and
not necessarily the transient nature of the order. Even if this be correct, the
fact still remains that the state authority has no power to make an order of
prohibition, either of a permanent nature or enduring for such a long time as
to be deemed to be permanent.
The appellants point out that, despite the amendment having been made in the
year 1964, even the state of Maharashtra kept on corresponding with the Central
Government to suggest that it was necessary to carry out an amendment in the
law to enable it to permanently ban the article concerned. Reliance is placed
on pp. 152 - 154, Vol. II of S.L.P. No. 834 of 2003, the annexure to the
counter affidavit filed by F.K.
Pandey on behalf of the Government of India. Particular reference is made to
the letter dated 1st August, 1997 from the Commissioner, Food and Drug
Administration and Food (Health) Authority to the Secretary, Medical Education
and Drug Department, Mumbai about the ill-effects of gutka and requesting the
state Government to amend the Maharashtra Prevention of Food Adulteration Rules
and also to make a request to the Central Government to amend the Prevention of
Food Adulteration Act so as to enable the state of Maharashtra to exercise
the powers of a permanent ban.
While this may not be really conclusive, it certainly indicates the manner
of the state authority viewing its power and the rules under which it was
exercising the power. The court can certainly take into account this situation
on the doctrine of Contemporanea expositio.
It is significant that, while dealing with the powers of food inspector
under Section 10(1)(c) of the Act, the Act provides that a food inspector shall
have power, with the previous approval of the Local (Health) Authority having
jurisdiction in the local area concerned, or with the previous approval of the
Food (Health) Authority, to prohibit the sale of any article of food in the
interest of public health. Secondly, this clause does not include the phrase
"for the time being". If the arguments of the learned counsel for the
state Governments were to prevail, then this provision would give to the food
inspector, a lower authority in the hierarchy, an extraordinary power of
banning permanently - which power can only be the result of a policy decision
to be taken at the highest level of the state Government. In our view, it is
not possible to interpret these clauses disparately or disjunctively. Clause
(iv) of Section 7 and clause (c) of sub-section (1) of Section 10 of the Act
and their interplay unmistakably suggest that the power conferred on the Food
(Health) Authority and the food inspector, being derived from the Rules made in
exercise of the powers exercised under Section 24 of the Act are necessarily
subservient to the powers derivable from the rules made under Section 23 of the
Act. Hence, neither the Food (Health) Authority, nor the food inspector can be
said to have such power which could be available to the Central Government by
prescription of a rule in exercise of power under Section 23(1A)(f).
Reliance was placed by the respondents on the decision of a learned Single
Judge in Gandhi Irwin Salt Manufacturers Association v. The Government of Tamil
Nadu . Having perused the judgment, we are unable to approve of it. We notice
that neither the interplay between Sections 23 and 24, nor the question as to
whether Section 24 can be the source of power, is discussed or decided therein.
Conflict with Central Act 34 of 2003:
Mr. Nariman, learned counsel appeared for the appellants in the appeals
arising out of SLP Nos. 23635 of 2002 and 533 of 2003, attacked the judgment of
the Bombay High Court from a different perspective. He contends that the
Cigarettes and Other Tobacco Products (Prohibition of Advertisement and
Regulation of Trade and Commerce, Production, Supply and Distribution) Act,
2003, (Act 34 of 2003), referable to entry 52, List I and entry 18, List III to
the Seventh Schedule of the Constitution of India, now occupies the entire
field in relation to tobacco. The preamble to the Act 34 of 2003 reads as under:
" An Act to prohibit the advertisement of, and to provide for the
regulation of trade and commerce in, and production, supply and distribution
of, cigarettes and other tobacco products and for matters connected therewith
or incidental thereto" The Statement of Objects and Reasons accompanying
the Bill reads as under:
"1. Tobacco is universally regarded as one of the major public health
hazards and is responsible directly or indirectly for an estimated eight lakh
deaths annually in the country. It has also been found that treatment of
tobacco related diseases and the loss of productivity caused therein cost the
country almost Rs.13,500/- crore annually, which more than offsets all the
benefits accruing in the form of revenue and employment generated by tobacco
industry. The need for a comprehensive legislation to prohibit advertising and
regulation of production, supply and distribution of cigarettes and tobacco
products was recommended by the Parliamentary Committee on Subordinate
Legislation (Tenth Lok Sabha) and a number of points suggested by the Committee
on Subordinate Legislation have been incorporated in the Bill.
2. The proposed Bill seeks to put total ban on advertising of cigarettes and
other tobacco products and to prohibit sponsorship of sports and cultural
events either directly or indirectly as well as sale of tobacco products to
minors. It also proposes to make rules for the purpose of prescribing the
contents of the specified warnings, the languages in which they are to be
displayed, as well as displaying the quantities of nicotine and tar contents of
these products. For the effective implementation of the proposed legislation,
provisions have been proposed for compounding minor offences and making
punishments for offences by companies more stringent. The objective of the
proposed enactment is to reduce the exposure of people to tobacco smoke
(passive smoking) and to prevent the sale of tobacco products to minors and to
protect them from becoming victims of misleading advertisements. This will
result in a healthier life style and the protection of the right to life
enshrined in the Constitution. The proposed legislation further seeks to
implement article 47 of the Constitution which, inter alia, requires the State
to endeavour to improve public health of the people.
3. The Bill seeks to achieve the aforesaid objects." The aforesaid
internal evidence in the statute, by reason of the preamble, and the external
evidence in the Statement of Objects and Reasons, indicate that Parliament has
evinced its intention to bring out a comprehensive enactment to deal with
tobacco and tobacco products.
However, the provisions of the statute do not suggest that Parliament had
considered it to be expedient to ban tobacco or tobacco products in public
interest or to protect public health. Act 34 of 2003 passed by Parliament does
not totally ban the manufacture of tobacco or tobacco products.
Section 6 merely prohibits sale of cigarettes and tobacco products to a
person under the age of eighteen years. There are stringent provisions made in
the Act containing the prohibition of advertisement of cigarettes and tobacco
products. Section 3(p) defines the expression "tobacco products" as
the products specified in the Schedule. Entry 8 of the Schedule to the Act reads
"pan masala or any chewing material having tobacco as one of its
ingredients (by whatever name called)." Thus, pan masala or any chewing
material having tobacco is also one of the products in respect of which the Act
could have imposed a total prohibition, if Parliament was so minded. On the
other hand, there is only conditional prohibition of these products against
sale to persons under eighteen years of age.
Against this backdrop of Act 34 of 2003, learned counsel contended that
inasmuch as Act 34 of 2003 occupies the whole field of tobacco and tobacco
products and does not completely ban the sale of 'tobacco products' except to
under aged persons, while the impugned notification expressly bans manufacture
or sale to any person of the very same product (viz. Pan masala and gutka),
there is legislative repugnancy which calls for resolution. Reliance was placed
on the judgment of this Court in Deep Chand v. The State of U.P. and Ors.
wherein this Court considered the constitutional validity of a state enactment.
This Court's earlier judgment in Ch. Tika Ramji & Ors. v. The State of U.P.
& Ors. and Zaverbhai Amaidas v. The State of Bombay were approved and the
test of repugnancy was formulated thus:
"Repugnancy between two statutes may thus be ascertained on the basis
of the following three principles (1) Whether there is direct conflict between
the two provisions;
(2) Whether Parliament intended to lay down an exhaustive code in respect of
the subject matter replacing the Act of the State Legislature; and (3) Whether
the law made by Parliament and the law made by the State Legislature occupy the
same field." Learned counsel contended that when two legislations
referable to the same legislative authority are inconsistent with each other,
then the later enactment is deemed to have impliedly repealed the previous one
and referred to the observations of this Court in State of Orissa v. M.A.
Tulloch and Co. :
"The entire theory underlying implied repeals is that there is no need
for the later enactment to state in express terms that an earlier enactment has
been repealed by using any particular set of words or form of drafting but that
if the legislative intent to supersede the earlier law in manifested by the
enactment of the provisions as to effect such supersession, then there is in
law a repeal notwithstanding the absence of the word 'repeal' in the later
statute. Now, if the legislative intent to supersede the earlier law is the
basis upon which the doctrine of implied repeal is founded could there be any incongruity
in attributing to the later legislation the same intent which s. 6 presumes
where the word 'repeal' is expressly used. So far as statutory construction is
concerned, it is one of the cardinal principles of the law that there is no
distinction or difference between an express provision and a provision which is
necessarily implied, for it is only the form that differs in the two cases and
there is no difference in intention or in substance." The learned counsel
relied on Vijay Kumar Sharma & Ors. v.
State of Karnataka and Ors. . The observation of this Court in the majority
judgment of this Court is that if the later legislation is on the same subject
and the legislative intent is to occupy the whole field, then the later
It is submitted that a reading of the Act 34 of 2003 clearly suggests that
it is a special law intended to deal with tobacco and its product. The Prevention of
Food Adulteration Act, 1954 is a general law dealing with adulteration of
food articles and a tobacco product is incidentally referred to in the said law
in the context of prevention of adulteration. In case of conflict between a
special law and a general law, even if both are enacted by the same legislative
authority, the special law must displace the general law to the extent of
inconsistency. The operation of the maxim generalia specialibus non derogant
has been approved and applied by this Court in such situations. (See in this connection:
U.P. State Electricity Board and Ors. v. Hari Shanker Jain & Ors. , Gujarat
State Cooperative Land Development Bank Ltd. v. P.R. Manded and Ors. , The LIC
of India v. D.J. Bahadur & Ors. , Jain Ink Manufacturing Co. v. LIC of
India & Anr. , Prof. Sumer Chand v. Union of India and Ors. and Allahabad
Bank v. Canara Bank & Anr. .) Respondents contend that inasmuch as Act 34
of 2003, though passed by Parliament, and assented to by the President, is not
brought into force by the Central Government by notification, the question of
conflict with the provisions of the Act does not arise. We need not consider
this contention since Act 34 of 2003 has now been brought into force w.e.f.
1st May, 2004. In any event, as pointed out in Pt. Rishikesh and another v.
Salma Begum there is distinction between "making law" and
"commencement of the operation of an Act" and a situation of conflict
can arise even when a law has been made and not brought into force.
Articles 14 and 19 of the Constitution of India:
Mr. Shanti Bhushan, learned counsel for the appellant in SLP No.
2186 of 2003, urged that the said appellant manufactures Rajnigandha pan
masala which contains no tobacco. Though there might be arecanut in it, there
is no trace of magnesium carbonate in the product. Assuming that traces of
magnesium carbonate were to be formed during consumption of the product along
with lime, the exercise of power should have been restricted to banning pan
masala containing magnesium carbonate and not wholesale banning of pan masala,
irrespective of the content of magnesium carbonate. The learned counsel
contended that the order made under Section 7(iv) of the Act is bad for it is
an unreasonable and excessive restriction on the Fundamental Right to carry on
trade or business guaranteed under Article 19(1)(g) of the Constitution of
India. The learned counsel highlighted the unreasonableness by reference to the
provisions of the Act and the Rules and the specific situation contemplated in
Appendix B at Paragraph A.25.02.01, which gives the definition and standards of
quality with reference to chewing gum and bubble gum, for which magnesium
carbonate, inter alia, is a permitted ingredient. He therefore contends that
magnesium carbonate is not per se injurious to health for otherwise it would
never have been permitted in any article of food. There is no material on the
basis of which it can be demonstrated that the very same magnesium carbonate
would become injurious to health if it arises on account of mixing of traces of
magnesium in arecanut and carbonate in lime According to the learned counsel,
this is a clear case of non- application of mind, notwithstanding the medical
research papers and data made available in the affidavit filed by the state
We are unable to discern as to how the very same magnesium carbonate would
become injurious as a result of combined chewing of arecanut and lime,
particularly when it is not the case of the state Government that Rajnigandha
pan masala itself contains magnesium carbonate. It is permissible under Article
19(6) to impose a reasonable restriction "in the interest of general
public". Assuming that such a restriction can be imposed, even if by
legislation intended to prohibit manufacture, sale or storage of articles harmful
or injurious to health, the restriction has to be commensurate with the danger
On a conspectus of the facts, we are unable to uphold the prohibition
imposed by the impugned notification as a restriction which can pass the test
of reasonableness under Article 19(6) of the Constitution of India for two
reasons. First, there is no demonstrated danger to the public health by
magnesium carbonate by consumption of Rajnigandha pan masala; secondly, even if
there were, the prohibition could only have extended to pan masala containing
magnesium carbonate and could not be wider than that.
Learned counsel for the appellants urge that if Section 7(iv) is construed
in the manner as contended by the State, then it would become unconstitutional.
It is contended that if Section 7(iv) is construed as giving the authority to
ban articles of food, even though not adulterated, then the sweep of the
section would go out of entry 18 of List III of the Constitution of India.
("adulteration of foodstuffs and other goods.") and intrude into the
domain of entry 6 of List II ("public health and sanitation;
hospitals and dispensaries") which is the exclusive domain of the state
Government. If the court were to read Section 7(iv) in the manner suggested by
the States, then it would be ultra vires the legislative competence of
Parliament. It is the duty of the court to attempt to read every legislation in
such manner as to uphold its constitutional validity.
The learned counsel contend that in order to uphold the legislative
competence of the provisions of the Act, the sweep of Section 7(iv) must be
confined to the domain of 'adulteration of food stuffs and other articles'
without entering into the domain of "public health". Reading down the
statute in order to upheld its constitutional validity is a device well known
to the constitutional courts. [See in this connection State of Karnataka and
Anr. v. Shri Ranganatha Reddy & Anr. , B.R. Enterprises and Ors. v. State
of U.P. and Ors. , and State of A.P. v. National Thermal Power Corpn. Ltd. and
Ors. ] Mr. Lalit, learned counsel for the States, however, supported the
findings of the division bench of the Bombay High Court that the constitutional
validity of Section 7(iv) was never in danger as it could be supported on the
doctrine of pith and substance. He contends that in pith and substance the Prevention of
Food Adulteration Act, 1954 deals with the subject of adulteration, though,
incidentally, by reason of Section 7(iv) it may make an incursion into the
domain of "public health" which is the exclusive province of the
State legislature. This contention appears to have been accepted by the
impugned judgment of the High Court of Bombay.
In fact, the High Court goes to the extent of saying that the power of the
Food (Health) Authority under Section 7(iv) is much wider than the power of the
Central Government under the Rules made under Section 23(1A)(f) on the
reasoning that while the power of the Central Government under a rule made
under Section 23(1A)(f) extends to the prohibition of the sale of "any
substance which may be injurious to health when used as food or as an
ingredient in the manufacture of any article of food" there is no such
restriction under Section 7(iv) which is posited as an independent source of
power. It is urged that by exercise of the power invested in the Food (Health)
Authority under clause (iv) of Section 7, any article, irrespective of whether
it is used as food or as an ingredient in the manufacture of any article of
food, may be prohibited as long as the prohibition is "in the interest of
We find it difficult to agree with the submissions of Mr. Lalit. That all
provisions of a statute have to be read harmoniously and any interpretation as
to be ex visceribus actus, is a trite doctrine of construction of statutes.
Undoubtedly, if Section 7(iv) is read in isolation, it gives the impression
that this is an independent source of power, not subject to any limitation
other than the guideline "in the interest of public health". But,
when the scheme of the Prevention of
Food Adulteration Act is analysed in the light of its preamble and the
Statement of Objects and Reasons, it becomes clear that there is no independent
source of power under Section 7(iv). Had it been so, there was no need for the
rule making power of the State Government under Section 24(2)(a) to define the
powers and duties of the Food (Health) Authority or local authority and Local
(Health) Authority under the Act. The interplay of sections 23(1A)(f) and
24(2)(a) read with the existing rules in the different states, even after the
amendment of Section 7(iv) by the Act 49 of 1964, leads us to conclude that the
contention of the states in this regard cannot be accepted.
Learned counsel for the appellants contend that the impugned notification is
violative of the fundamental rights guaranteed under Article 19(1)(g) as it is
excessively restrictive in nature. While the notification seeks to ban pan
masala which does not include tobacco, it does not at the same time ban tobacco
in any form. The literature produced by the State of Maharashtra before the
High Court suggested, undoubtedly, that consumption of tobacco in any form was
injurious to health, but that consumption of pan masala was likely to be
addictive and lead to hyper- magnesia. Strangely, the States did not ban
chewing tobacco or other tobacco products which contain almost cent per cent
tobacco, but they banned the sale of gutka which contains only about 6 per cent
of tobacco and pan masala, which contains no tobacco whatsoever, even accepting
on the correctness of the material presented. Further, the literature produced
by the States indicates that pan masala is addictive amongst children and,
therefore, likely to be injurious to their health in the long run. Assuming
this to be true, the restriction could only have been on sale to under-aged
persons and not by way of a total ban. Thus, in our view, the impugned
notification is violative of the fundamental right of the appellants guaranteed
under Article 19(1)(g), both because it is unreasonable and also because it is
excessive in nature. A contrast with the provisions of the Act 34 of 2003 in
this regard would drive home the point.
While dealing with the nature of a reasonable restriction on the fundamental
rights under Article 19(1)(g), this Court observed in Mohd.
Faruk v. State of Madhya Pradesh and Ors. as under:
"The impugned notification, though technically within the competence of
the State Government, directly infringes the fundamental right of the
petitioner guaranteed by Art. 19(1)(g), and may be upheld only if it be
established that it seeks to impose reasonable restrictions in the interest of
the general public and a less drastic restriction will not ensure the interest
of the general public. The Court must in considering the validity of the
impugned law imposing a prohibition on the carrying on of a business or
profession, attempt an evaluation of its direct and immediate impact upon the
fundamental rights of the citizens affected thereby and the larger public
interest sought to be ensured in the light of the object sought to be achieved,
the necessity to restrict the citizen's freedom, the inherent pernicious nature
of the act prohibited or its capacity or tendency to be harmful to the general
public, the possibility of achieving the object by imposing a less drastic
restraint, and in the absence of exceptional situations such as the prevalence
of a state of emergency - national or local - or the necessity to maintain
essential supplies, or the necessity to stop activities inherently dangerous,
the existence of a machinery to satisfy the administrative authority that no
case for imposing the restriction is made out or that a less drastic
restriction may ensure the object intended to be achieved." The impugned
notification fails on this test of reasonable restriction.
Res extra commercium:
Appellants next contend that the assumption of the High Court that pan
masala or gutka is res extra commercium is wholly incorrect.
The concept of res extra commercium was expounded in the Constitutional
Bench of this Court in Khoday Distilleries Ltd. and Ors.
v. State of Karnataka and Ors. thus:
"58. We also do not see any merit in the argument that there are more
harmful substances like tobacco, the consumption of which is not prohibited and
hence there is no justification for prohibiting the business in potable
alcohol. What articles and goods should be allowed to be produced, possessed,
sold and consumed is to be left to the judgment of the legislative and the
executive wisdom. Things which are not considered harmful today, may be
considered so tomorrow in the light of the fresh medical evidence. It requires
research and education to convince the society of the harmful effects of the
products before a consensus is reached to ban its consumption. Alcohol has
since long been known all over the world to have had harmful effects on the
health of the individual and the welfare of the society. Even long before the
Constitution was framed, it was one of the major items on the agenda of the
society to ban or at least to regulate, its consumption. That is why it found
place in Article 47 of the Constitution. It is only in recent years that
medical research has brought to the fore the fatal link between smoking and
consumption of tobacco and cancer, cardiac diseases and deterioration and
tuberculosis. There is a sizeable movement all over the world including in this
country to educate people about the dangerous effect of tobacco on individual's
health. The society may, in course of time, think of prohibiting its production
and consumption as in the case of alcohol. There may be more such dangerous
products, the harmful effects of which are today unknown. But merely because
their production and consumption is not today banned, does not mean that
products like alcohol which are proved harmful, should not be banned.
. . . . .
60(b) The right to practise any profession or to carry on any occupation,
trade or business does not extend to practising a profession or carrying on an
occupation, trade or business which is inherently vicious and pernicious, and
is condemned by all civilised societies. It does not entitle citizens to carry
on trade or business in activities which are immoral and criminal and in
articles or goods which are obnoxious and injurious to health, safety and
welfare of the general public, i.e., res extra commercium, (outside commerce).
There cannot be business in crime." Is the consumption of pan masala or
gutka (containing tobacco), or for that matter tobacco itself, considered so
inherently or viciously dangerous to health, and, if so, is there any
legislative policy to totally ban its use in the country ? In the face of Act
34 of 2003, the answer must be in the negative. It is difficult to accept the
contention that the substance banned by the impugned notification is treated as
res extra commercium. In the first place, the gamut of legislation enacted in
this country which deals with tobacco does not suggest that Parliament has ever
treated it as an article res extra commercium, nor has Parliament attempted to
ban its use absolutely. The Industries (Development and Regulations) Act, 1951
merely imposed licensing regulation on tobacco products under item 38(1) of the
First Schedule. The Central Sales Tax
Act, 1956 in Section 14(ix) prescribes the rates for Central Sales Tax.
Additional Duties of Excise (Goods of Special Importance) Act, 1957 prescribes
the additional duty leviable on tobacco products. The Tobacco Board Act,
1975 established a Tobacco Board for development of tobacco industries in
the country. Even the latest Act, i.e. the Cigarettes and Other Tobacco
Products (Prohibition of Advertisement and Regulation of Trade and Commerce,
Production, Supply and Distribution) Act, 2003, does not ban the sale of tobacco
products listed in the Schedule except to minors. Further, we find that in the
tariff schedule of the Central Sales Tax
Act, there are several entries which deal with tobacco and also pan masala.
In the face of these legislative measures seeking to levy restrictions and
control the manufacture and sale of tobacco and its allied products as well as
pan masala, it is not possible to accept that the article itself has been
treated as res extra commercium. The legislative policy, if any, seems to be to
the contrary. In any event, whether an article is to be prohibited as res extra
commercium is a matter of legislative policy and must arise out of an Act of
legislature and not by a mere notification issued by an executive authority.
Need to read down:
There is also merit in the contention of the appellants that if the
provisions of Section 7(iv) of the Act are not read down as conferring powers
on the authority to deal with an emergent situation, the section would be
conferring arbitrary powers on the authority and would be procedurally unfair.
This is particularly so in the face of the statutory provision under which
licences have already been granted to the manufactures of pan masala and gutka
for manufacture of the articles.
There is already a provision in the statutory scheme for cancellation and
suspension of a licence. Without going through such procedure, the power in the
state authority to suddenly bring out the result of cancellation or suspension
of the licence, without procedural safeguards, would certainly be arbitrary and
liable to be hit by Article 14 of the Constitution of India.
For this reason also, the power under Section 7(iv) needs to be read down as
conferring powers on the authority only to deal with an emergent situation.
There has been some argument at the Bar as to whether the impugned
notification is the result of an executive act or a legislative act. We have
already indicated that, in our view, Section 7(iv) is not an independent source
of power. The notification can only be issued by the authority the source of
whose power must be located elsewhere. Section 7(iv) merely indicates the
consequences which would flow if a valid notification is issued. It is, therefore,
not necessary for us to go into the niceties between an executive and a
Mr. Anil Divan, learned counsel appearing for one of the appellants, pointed
out that the Central
Sales Tax Act by Section 14(ix) recognises gutka as a legitimate article of
interstate trade or interstate sale. So is pan masala recognised as such a
legitimate article of interstate sale. The learned counsel relied on M/s Dwarka
Prasad Laxmi Narain v. The State of U.P. and Ors. to contend that a law or
order which confers arbitrary or uncontrolled power on the executive in the
matter of regulating trade or commerce in normally available commodities must
be held to unreasonable. [See also in this connection the observations of this
Court in B.B. Rajwanshi v. State of U.P. and Ors. ] Learned counsel highlighted
the observations of this Court in Maneka Gandhi v. Union of India and contended
that irrespective of whether the power to issue the impugned notification is a
legislative power or an executive power, it must pass the test of fairness in
procedure. Any provision of law which enables to an authority by a notification
to bring to standstill a business, which is otherwise permitted by law, must be
held to be arbitrary; unfair and an abridgment of the fundamental rights
guaranteed under Article 14 of the Constitution. [See also in this connection
Kanti Lal Babulal v. H.C. Patel , Ajay Hasia and Ors. v. Khalid Mujib
Sehravardi and Ors. and Delhi Transport Corporation v. D.T.C.
Mazdoor Congress and Ors. ] It is in the light of these authorities that we
are required to adjudge the constitutionality of the interpretation put on
Learned counsel for the States, however, urge that the impugned notification
is a legislative act and not an administrative act. Thus, according to them,
there is no question of giving a hearing before taking a policy decision to ban
the manufacture for sale, storage, sale and distribution of pan masala and
We are unable to accept the contention of the States. In our view, the
scheme of the Act suggests that a decision to ban an article injurious to
health, when used as food or as an ingredient in the manufacture of any article
of food, can only be the result of broader policy. Hence, this larger power
appears to have been located only in the Central Government under Section
23(1A)(f) and not in the state Food (Health) Authority. As we have already
pointed out, the power of the state Food (Health) Authority is only transitory
in nature and designed to deal with local emergencies. In our considered view,
the impugned notification is certainly an administrative act and not a
legislative act. Inasmuch as by an executive act the manufacture for sale,
storage, sale or distribution of the concerned article has been banned so as to
interfere with the fundamental rights of the appellants guaranteed under
Articles 14 and 19 of the Constitution of India, the impugned notification is
illegal and unconstitutional.
We are unable to accept that the words "in the interest of public
health" used in clause (iv) of Section 7 of the Act can operate as an
incantation or mantra to get over all the constitutional difficulties posited.
In any event, the collocation of the words in the statutory scheme suggests
not a matter of policy, but a matter of implementation of policy. For this
reason also, we are of the view that the impugned notification must fail.
The learned Advocate General for the State of Goa contended that in the
State of Goa, apart from the impugned notification dated 24th January, 2003,
there is a subsequent notification dated 7th April, 2003 which is not impugned
by the appellants. Reliance is placed on a judgment of the division bench of
the Bombay High Court in Vaman Raghunath Fallary & Sons and Ors. v. State
of Goa and Ors. . The division bench in the said decision seems to have been
overwhelmed by the material produced with regard to the hazardous nature of pan
masala with tobacco and taken the view that the State Government was justified
in taking a decision to ban tobacco products within the realm of such policy
decision. The division bench has not addressed itself to any of the sections of
the Act which decide the powers. The learned Advocate General for the State of
Goa contends that matters of public health are essentially matters of policy
decision, legislative or administrative, planned and executed in the greater
interest of public health by the Government and the court should not interfere
with such policy matters. He relied on the observations of P.N.
Krishna Lal and Ors. v. Govt. of Kerala and Anr. wherein this Court said:
"24. The raison d'etre of the State being the welfare of the members of
the society, the whole purpose of the creation of the State would be to
maintain order, health and morality by suitable legislation and proper
administration. The State has the power to prohibit trade or business which are
illegal, immoral or injurious to the health and welfare of the people.
No one has the right to carry on any trade or occupation or business which
is inherently vicious and pernicious and is condemned by all civilized
societies. Equally no one could claim entitlement to carry on any trade or
business or any activities which are criminal and immoral or in any articles of
goods which are obnoxious ad injurious to the safety and health of general
public. There is no inherent right in crime.
Prohibition of trade of business of noxious or dangerous substances or goods
by law is in the interest of society welfare." There is a plethora of
legislation dealing with tobacco products, gutka and pan masala and the fact
that licences have been issued to the appellants to manufacture the concerned
articles, which does not lead to the conclusion that the trade or business in
the concerned articles is an activity which is "criminal in propensity,
immoral, obnoxious, injurious to the health of general public" or that the
ban is a result of 'public expediency and public morality'.
Is it food ? Mr. Nagaraja, learned counsel appearing for the petitioners in
writ petition No. 173 of 2003, raised a further contention that pan masala or
gutka which is the subject matter of the impugned notification does not amount
to food within the meaning of its definition in Section 2(v) of the Act.
Section 2(v) of the Act reads as under:
"2. (v) "food" means any article used as food or drink for
human consumption other than drugs and water and includes- (a) any article
which ordinarily enters into, or is used in the composition or preparation of ,
human food, (b) any flavouring matter or condiments, and (c) any other article
which the Central Government may, having regard to its use, nature, substance
or quality, declare, by notification in the Official Gazette, as food for the
purposes of this Act." In his submission, the expression "food"
as defined in the Lexicon could only be "a substance taken into the body
to maintain life and growth". No one in his right mind would consider that
pan masala or gutka would be consumed for maintenance and development of health
of human being. In P.K. Tejani v. M.R. Dange , this Court held that the word
"food" is a very general terms and applies to all that is eaten by
men for nourishment and takes in also subsidiaries. Since pan masala, gutka or
supari are eaten for taste and nourishment, they are all food within the
meaning of Section 2(v) of the Act.
The learned counsel relied on a judgment of a division bench of this Court
in C.A. No. 12746-12747 of 1996 (decided on 6th November, 2003).
In our view, this judgment is of no aid to us. In the first place, this
judgment arises under the provisions of the Essential
Commodities Act, 1955, read
with the Tamil Nadu Scheduled Articles (Prescription of Standards) Order, 1977
and the notification dated 9th June, 1978, issued by the Central Government
which laid down certain specifications "in relation to foodstuffs".
The question that arose before the Court was whether tea is 'foodstuff' within
the meaning of the said legislation. The division bench of this Court came to
the conclusion that 'tea' is not food as it is not understood as 'food' or
'foodstuff' either in common parlance or by the opinion of lexicographers. We
are unable to derive much help from this judgment for the reason that we are
not concerned with tea. It is not possible to extrapolate the reasoning of this
judgment pertaining to tea into the realm of pan masala and gutka. In any
event, the judgment in Tejani (supra) was a judgment of the Constitutional
Bench which does not seem to have been noticed.
We are, therefore, unable to agree with the contention that pan masala or
gutka does not amount to "food" within the meaning of definition in
Section 2(v) of the Act. However, we do not rest our decision solely on this
There is yet another reason why we are inclined to take the view that
Section 7(iv) deals with a situation of emergency with respect to the local
area. A decision for banning an article of food or an article containing any
ingredient of food injurious to health can only arise as a result of broadly
considered policy. If such a power be conceded in favour of a local authority
like the Food (Health) Authority, paradoxical results would arise.
The same article could be considered injurious to public health in one local
area, but not so in another. In our view, the construction of the provision of
the statute must not be such as to result in such absurd or paradoxical
consequences. Hence, for this reason also, we are of the view that the power of
the State (Health) Authority is a limited power to be exercised locally for
Width of power:
The learned counsel for the state of Maharashtra contended that the power of
the Food (Health) Authority discernible in clause (iv) of Section 7 of the Act
is an independent power and much wider than the power of the Central Government
under Section 23 of the Act. He contended that while the power of the Central
Government discernible from Section 23(1A)(f) is restricted only to prohibiting
the manufacture or sale of articles of food or ingredients of food, the power
of the state Food (Health) Authority is much wider and could extend even to
articles which may not amount to food or ingredients of food, or even if they
are not injurious to health, as long as the test of "in the interest of
public health" is satisfied.
In our view, this is an argument of desperation. We cannot conceive of such
wide ranging power vested in a local authority without there being sufficient
guidelines as to the manner of deciding the policy and implementing it and
elucidated in the statute itself. We may hasten to point out that even the power
of Central Government for making the rules under Section 23 is subject to the
condition of consultation with the Central Committee for food standards
constituted under Section 23 and placing of the rules before Parliament. If the
power of the Food (Health) Authority is such as contended by the learned
counsel for the state of Maharashtra, then its power would range sky high
without any limitation whatsoever. The authority could ban any article,
irrespective of whether it is used as food or otherwise, and irrespective of
whether it is injurious to health or otherwise.
To take an extreme illustration, if a state Food (Health) Authority in some
local area were taken it into its head that consumption of tea, coffee or milk
is not 'in the interest of public health', it can issue an order of absolute
prohibition irrespective of whether it is injurious to health or not. We do not
think that the scheme of the Act warrants such an interpretation.
A reference of this Court's judgment in Dineshchandra Jamnadas Gandhi v.
State of Gujarat vide paras 16 and 17 makes it clear that the object and the
purpose of the Preventon of Food Adulteration Act, 1954 is to eliminate the
danger to human life from the sale of unwholesome articles of food. This Court
held that the legislation of 'Adulteration of Food Stuffs and other Goods'
(entry 18 List III of the Seventh Schedule) is enacted to curb the widespread
evil of food adulteration and is a legislative measure for social defence. This
court indicated the object of the Prevention of
Food Adulteration Act, 1954, its constitutional basis and its purpose in
the following observations:
"16. The object and the purpose of the Act are to eliminate the danger
to human life from the sale of unwholesome articles of food. The legislation is
on the topic 'Adulteration of Food Stuffs and other Goods' (entry 18 List III
Seventh Schedule). It is enacted to curb the widespread evil of food
adulteration and is a legislative measure for social defence. It is intended to
suppress a social and economic mischief - an evil which attempts to poison, for
monetary gains, the very sources of sustenance of life and the well-being of
the community. The evil of adulteration of food and its effects on the health
of the community are assuming alarming proporations. The offence of
adulteration is a socio-economic offence. In Municipal Corporation of Delhi v.
Kacheroo Mal Sarkaria, J. said:
The Act has been enacted to curb and remedy the widespread evil of food
adulteration, and to ensure the sale of wholesome food to the people.
It is well-settled that wherever possible, without unreasonable stretching
or straining, the language of such a statute should be construed in a manner
which would suppress the mischief, advance the remedy, promote its object,
prevent its subtle evasion and foil its artful circumvention.
(emphasis supplied) ...
18. The offences under the 'Act' are really acts prohibited by the police
powers of the State in the interests of public health and well-being. The
prohibition is backed by the sanction of a penalty. The offences are strict
statutory offences. Intention or mental state is irrelevant. In Goodfellow v.
Johnson referring to the nature of offences under the Food and Drugs Act, 1955,
it was said:
As is well known, Section 2 of the Food and Drugs Act, 1955, constitutes an
If a person sells to the prejudice of the purchaser any food, and that
includes drink, which is not of the nature or not of the substance or not of
the quality demanded by the purchaser he shall be guilty of an offence. The
forbidden act is the selling to the prejudice of the purchaser." These
observations make it clear that the purpose of the Act, as its title suggests, is
to prevent adulteration of food. Any attempt to travel beyond these parameters
must necessarily be looked at askance by the court.
There is one more facet of the impugned notification which needs
consideration. Neither Section 7(iv) of the Act, nor any other provision of the
Act or the Rules indicates the manner in which an order of prohibition is to be
notified by the Food (Health) Authority. The manner of bringing into force the
Rules made by a delegate of legislative authority would be indicated in the Act
itself. There is no indication in the Act as to how the order made by the Food
(Health) Authority would be brought into force.
This is a pointer to the fact that the orders made by the Food (Health)
Authority are only transitory and intended to deal with emergent local
Learned counsel for the State of Maharashtra cited Union of India and Anr.
v. Cynamide India Ltd. and Anr. (vide para 7) where this Court observed thus:
"The third observation we wish to make is, price fixation is more in
the nature of a legislative activity than any other. It is true that, with the
proliferation of delegated legislation, there is a tendency for the line
between legislation and administration to vanish into an illusion.
Administrative, quasi-judicial decisions tend to merge in legislative activity
and, conversely, legislative activity tends to fade into and present an
appearance of an administrative or quasi-judicial activity. Any attempt to draw
a distinct line between legislative and administrative functions, it has been
said, is 'difficult in theory and impossible in practice'.
Though difficult, it is necessary that the line must sometimes be drawn as
different legal rights and consequences may ensue.
The distinction between the two has usually been expressed as 'one between
the general and the particular'. 'A legislative act is the creation and
promulgation of a general rule of conduct without reference to particular
cases; an administrative act is the making and issue of a specific direction or
the application of a general rule to a particular case in accordance with the
requirements of policy'. 'Legislation is the process of formulating a general
rule of conduct without reference to particular cases and usually operating in
future ; administration is the process of performing particular acts, of
issuing particular orders or of making decisions which apply general rules to
particular cases'. It has also been said: 'Rule-making is normally directed
toward the formulation of requirements having a general application to all
members of a broadly identifiable class' while, 'adjudication, on the other
hand, applies to specific individuals or situations'. But, this is only a broad
distinction, not necessarily always true. Administration and administrative
adjudication may also be of general application and there may be legislation of
particular application only. That is not ruled out. Again, adjudication
determines past and present facts and declares rights and liabilities while
legislation indicates the future course of action.
Adjudication is determinative of the past and the present while legislation
is indicative of the future. The object of the rule, the reach of its
application, the rights and obligations arising out of it, its intended effect
on past, present and future events, its form, the manner of its promulgation
are some factors which may help in drawing the line between legislative and
non-legislative acts." We are, however, unable to accept the contention of
the learned counsel for the state of Maharashtra that, because the notification
is generally intended, it is necessarily a legislative act and therefore there
was no question of complying with principles of natural justice. If that were
so, then every executive act could masquerade as a legislative act and escape
the procedural mechanism of fair play and natural justice.
In State of Tamil Nadu v. K. Sabanayagam and Anr. (vide para 17), this Court
after referring to the aforesaid observations of Chinnappa Reddy, J. in
Cynamide (supra), observed that even when exercising a legislative function,
the delegate may in a given case be required to consider the view point which
may be likely to be affected by the exercise of power. This Court pointed out
that conditional legislation can be broadly classified into three categories:
(1) when the legislature has completed its task of enacting a statute, the
entire superstructure of the legislation is ready but its future applicability
to a given area is left to the subjective satisfaction of the delegate (as in
Tulsipur Sugar Co. case ); (2) where the delegate has to decide whether and
under what circumstances a legislation which has already come into force is to
be partially withdrawn from operation in a given area or in given cases so as
not to be applicable to a given class of persons who are otherwise admittedly
governed by the Act; (3) where the exercise of conditional legislation would
depend upon satisfaction of the delegate on objective facts placed by one class
of persons seeking benefit of such an exercise with a view to deprive the rival
class of persons who otherwise might have already got statutory benefits under
the Act and who are likely to lose the existing benefit because of exercise of
such a power by the delegate. This Court emphasised that in the third type of
cases the satisfaction of the delegate must necessarily be based on objective
considerations and, irrespective of whether the exercise of such power is
judicial or quasi-judicial function, still it has to be treated to be one which
requires objective consideration of relevant factual data pressed into service
by one side, which could be rebutted by the other side, who would be adversely
affected if such exercise of power is undertaken by the delegate.
In our view, even if the impugned notification falls into the last of the
above category of cases, whatever the material the Food (Health) Authority had,
before taking a decision on articles in question, ought to have been presented
to the appellants who are likely to be affected by the ban order.
The principle of natural justice requires that they should have been given
an opportunity of meeting such facts. This has not been done in the present
case. For this reason also, the notification is bad in law.
As a result of the discussions, we are of the view that:
1. Section 7(iv) of the Act is not an independent source of power for the
2. The source of power of the state Food (Health) Authority is located only
in the valid rules made in exercise of the power under Section 24 of the Act by
the State Government, to the extent permitted thereunder;
3. The power of the Food (Health) Authority under the rules is only of
transitory nature and intended to deal with local emergencies and can last only
for short period while such emergency lasts;
4. The power of banning an article of food or an article used as ingredient
of food, on the ground that it is injurious to health, belongs appropriately to
the Central Government to be exercised in accordance with the rules made under
Section 23 of the Act, particularly, sub-section (1A)(f).
5. The state Food (Health) Authority has no power to prohibit the
manufacture for sale, storage, sale or distribution of any article, whether
used as an article or adjunct thereto or not used as food.
Such a power can only arise as a result of wider policy decision and emanate
from Parliamentary legislation or, at least, by exercise of the powers by the
Central Government by framing rules under Section 23 of the Act;
6. The provisions of the Cigarettes and Other Tobacco Products (Prohibition
of Advertisement and Regulation of Trade and Commerce, Production, Supply and
Distribution) Act, 2003 are directly in conflict with the provisions of Section
7(iv) of the Prevention
of Food Adulteration Act, 1954. The former Act is a special Act intended to
deal with tobacco and tobacco products particularly, while the latter enactment
is a general enactment. Thus, the Act 34 of 2003 being a special Act, and of
later origin, overrides the provisions of Section 7(iv) of the Prevention of
Food Adulteration Act, 1954 with regard to the power to prohibit the sale
or manufacture of tobacco products which are listed in the Schedule to the Act
34 of 2003;
7. The impugned notifications are ultra vires the Act and, hence, bad in
8. The impugned notifications are unconstitutional and void as abridging the
fundamental rights of the appellants guaranteed under Articles 14 and 19 of the
In the result, we allow the appeals and the writ petition and set aside the
impugned judgments of the division benches of the Bombay High Court and Andhra
Pradesh High Court and quash the notifications impugned as bad in law, void,
illegal and unenforceable against the appellants/petitioners.
No order as to costs.