BISHAMBHAR DAYAL CHANDRA MOHAN AND OTHERS ETC. ETC. v. STATE OF UTTAR PRADESH & ORS

Citation: [1982] 1 S.C.R. 1137

Court: Supreme Court of India

Bench: A.P. SEN, BAHARUL ISLAM

Case summary

It necessarily involves a claim by the petitioners who are wholesale dealers of foodgrains that the exercise of such governmental power conflicts with the rule of law and is in flagrant violation of the freedom of trade, commerce and intercourse guaranteed under Art....

Judgment text

1137 BISHAMBHAR DAYAL CHANDR OTHERS ETC E A MOHAN AND . TC. v. STATE OF UTTAR PRADESH & ORS. B November S, /98! [A. P. SEN AND BAHARUL [SLAM, JJ. J ... Uttar Prruinh Food Grains D~al~n (Llc~lfs. ll! ld . Ord~r, 1976and Ullar Prad~sh FoodGrai~s (p VII Re3trlctwn on Hoordillf) I: c Ordtr, 1978, clause (4) a. r amood~dby Notlfi:a~;o:e::::~~~~=1r. r;,adt) dartd April 21, 1981-Ttllpr/nttrMusagt ls. su~d bu IM St G ( -J/BO March J/ 1981 d' ·' ~ au OYtrnmtlfl datetl , regar: 1118en,orcetMnlof t/w Ordn,_cq1Utitl4li lUll fd' t/ Articles U, 19(/)(g), /62, JOOA ll! ld 301 o/tk CoiUrftUJioll of/;Ia. 1a' tty o- Conztllllliolt of India, Article 32-Juri/ktioll of the Supnmt Court 10 illrlstiKate Into facu, up/a/ned. l) " Worth Qlll/pltrasu-"Law" occurrill/f ;, Artic/4 300A "at Q/IY time'' Qfld . ( rtLJsonah/e ustrktion'', m~ani11g of, \ .

In exercise or the powers vestetl under the Essential Commodities Act, 1951, the State Government of Uuar Pratl~h issued two orders, namely (I} the Uttar E Prade$h Food Grains Dealers (Licensing and R~triction on Hoarding) Order, 1976 and (2) the Uttar Pradesh Food Grains (Procurement and Regulation of Trade) Order 1978. By irs teleprinter messase dated M:ucll 31, 1981 to all the . I ~egional Food Controllers, theState Government issued certain further instruc- . t ~IOns '? r ~ffectivc enforcement of the two 01ders aod io parricularregulatin~ the . J( tDICr·dJstnct and outside the State-movement of wheat by traders on pnvatc account, By a Notification No. P-XXIX-Food·S·S(42)/80 dared April21, 1981, F clause (4) of the t97tl Order, was amended providing that no wholesale dealer, commission asent, or 1 retuiler shall have in stock wheat more than 250 quintals, 2SO quintals and 20 quimats IC'pc under Article 301 of the Constitution, has its own limitations.

The liberty of an individual to do as he pleases is not absolute. It must yield to the common good. Absolute or unrestricted individual rights do not and cannot exist in any modern State. There is no protection of the rights [ themselves unless there is a measure of control and regulation of the rights of each individual in the interests F of all. Whenever such a conflict comes before the Court, it is its duty to har· r monise the exercise of the competing rights. The Court must balance the individual's rights of freedom of trade under Article 19(1)(g) and the freedom of inter- State trade and commerce under Article 301 as against the national interest. I Such a limitation is inherent in the exercise of those rights. [1! 64 E-H] 6:2.

Under Article 19(1l(g) of the Constitution, a citizen has the right to G carry on any occupation, trade or business and the only restriction on this unfettered right is the authority of the State to make a law imposing reasonable restrictions under clause (6}. [1165 A] 6:3. The expression "reasonable restriction" signifies that the limitation imposed on a person in enjoyment of the right should not be arbitrary or of an H excessive nature, beyond what is required in the interests of the :>ublic. The test pf. reasonableness. wherever prescribed1 should be applied to ea,ch individual ~--------------- ----- A statute impugned, and no abstract standard, or general pauern of reasonableness can be laid down as applicable in all cases.

The restriction which arbitrarily or excessively invades the right cannot be said to contain the quality ofreasonableness and unless it strikes a proper balanc~ between the freedom guaranteed in Article 19(1} {g) and the social control permitted by clause (6) of Article 19, it must be held to be wanting in that quality. [1165 B-D] 6:4. Several steps taken, in the instant case, like prevention of movement B of stock of wheat to various other States, movement of wheat from one district to another within the State only after the verification of the transaction and due endorsement by the Deputy Marketing Officer or th : Senior Marketing Officer concerned and also the physical verification at the check post on the State's borders etc. were designed to prevent a price rise in wheat in the State ofUttar Pradesh and to prevent outflow of wheat from the State to various other States and from one district to another district within the State.

The whole object was to c ensure that the wholesale dealers in foodgrains did not corner stocks of wheat for the purpose of speculation, and hence the steps taken were reasonable and in the interests of the general public. If, therefore, the seizure can be justified on the basis of any valid law, it cannot be held to be illegal. [1165 D-H] 7:1. Article 301 imposes a limitation on all legislative power in order to secure that trade, commerce and intercourse throughout the territory of India -. -r... D shali be free. Although Article 301 guarntees that trade, commerce intercourse throughout the country shall be free, the righ(to carry on inter-State trade and commerce may be subject to reasonable 1estrictions in the interests of the general public. [1165 A, 1166 A, C] 7:2. The word 'free' in Article 301 does not mean freedom from laws or from regulations. Article 301 guarantees freedom of trade, commerce and E intercourse throughout the country from any State barriers.

The whole object was to bring about the economic unity of the country under a federal structure, so that the people may feel that they are members of one nation. One of the means to achieve this object is to guarantee to every citizen in addition to the freedom of movement and residence throughout the country, which is achieved by Article l9(1)(d) and (e) is the freedom of movement or passage of commodities from one part of the country to another. This freedom of trade, commerce and F intercourse throughout the country without any "State barriers" is not confined to inter-State trade but also including intra-State trade as well. In other words, subject to the provisions of Part XIII, no restrictions can be imposed upon thtl flow of trade, commerce and intercourse, not only between the State and another, but betw impo>ing compensatory taxes do G not come within the purview of th~ restrictions contemplated by Article 301.

The regulatory measures should, however, be such as do not impede the freedom of trade, commerce and intercourse. [1166 H, 1167 A] 8:1. In view of the provisions of clause (3) of the 1976 Order read with clauses {4) & (6) of the 1978 Order, the validly seized e:tcess stock of wheat lying H with such dealer, that is, a wholesale dealer, commission agent or a retailer, in truth and substance, became their"unlicensed stock". Here, if really the Delhi traders had purchased the excess stock of wheat from wholesale dealers, com· BISHAMBHAR DAYAL V. U. P. STATE 1143 mission agents or retailers in the State of Uttar Pradesh, as is alleged, it is A possible to contend that there was a contravention of 'the provisions of clause (4) of the 1978 Order. The question whether the seizure was for any contravention of any order issued under section 3 of the Act has to be determined by the Additional District Magistrates (Civil Supplies), Agra, on the evidence adduced by the parties before him.

The facts being controverted, the petitioners have no right to relief under Article 32 of the Constitution. [1168 D-H, llfi9 A-B) B 8:2. Supreme Court can neither act on documents which are yet to be proved nor can they pronounce upon the genuineness of the transactions covered by them or record any finding on the basis of the documents when the facts are in dispute. [1169 E) 8:3. Normally, it is not the function of Supreme Court to investigate into facts in p! Oceediogs under Article 32 of the Constitution when they are controvertc ed with a view to discerning the truth. The matter must, in a situation like this, be left to the fact-finding body. For the establishment of their right to relief under Article 32, the petitioners must establish the necessary facts before the said Additional District Magistrate in the proceedings under section 6A of the Essential Commodities Act.

If they fail to get relief in such proceedings, their obvious remedy lies in a suit for damages for wrongful seizure. [1171 A-C) D 9:1. The State Government cannot while taking recourse to the executive power of the State under Article 162 of the Constitution deprive a person of his property. Such power can be exercised only by authority of Jaw and not by a mere executive fiat or order. Article 162 being subject to other provisions of the Constitution, is necessarily subject to Article 300A. [1169 F-G] Wazir Chand v. The Stale ofHimachal Pradesh, [1955] 1 SCR 408; Bishan E Das and Ot~rs v. The State ofPunjab and Others, [1962] 2 SCR 69, referred to. • ) 9:2. The word 'law' in the context of Article 300A must mean an Act of Parliament or of a State Legislature, a rule, or a statutory order, having the force of law, that is positive or State-made law. [1169 G·H] 9:3.

The effect of the Constitution {Pourth) Amendment Act, 1955, is that F there can be no 'deprivation' unle~s there is extinction of the right to property. Here, no doubt, the wheat hnd to be sold, as it was subject to spee-dy and natural decay, but the petitioners an. : entitled to the sale proceeds, if ultimately it is found by the Additional District Magistrate (Civil Supplies), Agra, that there wa~ no contravention by them of an order issued under section 3 of the Act. It IS true that the seizure was with intent to confiscate under section 6A of the Act, but that would not make the seizure illegal, if, ultimately, it is found that there was con~ravention of an order issued under section 3 of the Act.

If the G facts were not ·~ controversy and if the petitioners were able to prove that there was wrongful se•_zure of wheat by the State Government of Uttar Pradesh at the check post of Satyan on the border, whil¢ in transit, in the course of linter- State trade and commerce from the Union Territory of Delhi perh · th Jd b · 1 d • aps, ey wou e entit_e to the return of th. : seized wheat, or, in the alternative, to the payment of pCice thereof. (1170 D-H, 1171 A] H A 9:4. The question that the seizures were in reality for procurement of wheat in furtherance of the directive of the Central Government, and not for breach of the two Control Orders and, therefore, were nothing but a 'colourable exercise of power', is dependent on facts to be found on investigation.

Further, the question that there being no control price for wheat, the wheat should have been sold by public auction, is again a question that must be raised before the Additional District Magistrate (Civil Supplies), Agra, in the proceedings pending B before him under section 6A of the Act. [1171 C-D] ORIGINAL JURISDICTION : Food Grains Matters. A. Movement by Road: c (a) WP. Nos. 2907-2908, 3234, 3238-39, 3164, 3254, 3630· - 31, 3686, 3783, 3816, 4816, 4929-31, 4836-38, 4996- 5001, 15051-54, 5089-93, 5136-46, 5247, 3160, 3634, 4494,4616, 4967, 5362-71 , 5416-20, 5447-50, 5716-17, 5840, 6015, 6587-89 & 6609-14/8]. D (b) WP. Nos. 5062, 5157·58, 5451 & 5615-17/81. (c) WP Nos. 5097, 5042, 5098, 5017, 5214 & 6135-36/81 & 7003/81. (d) WP. Nos. 3421, 3407, 3408-13, 3422, 3536, 3561-64, E 5238, ! 3824, 5466, 5544, 6009, 6130-31, 6572-74 & 6582-83/81. (e) WP. Nos. 4904-4905, 5080, 5094, 5239-45, 5358-59, 5395, 5483, 5484-88, 5489-92, 5734-39, 6584-86 & 6817-21/81. F (f) WP_ Nos.

4960-62, 4958-59, 5129-33, 5219-20, 5331- - 33, 5518-19, 5526, 5428-31 & 5527/81. (g) WP. Nos. 4526, 4926, 4995, 5046, 5048-50, 5100, 5101. ... ' 5136-46, 5402-11' 5436-38, 5560, 5520-21' 5562, 5558, . 5556, 5559, 5550, 5546-47, 5552, 5555, 5553-54, 5511, G 5482, 5618-19, 5809-20, 6132-33, 6244, 6273-75, 6267- 72, 5512-14,5515,6570 and 5562/81, 7027-29 and 7032- 34/81. (h) WP. Nos. 5221, 5380-83, 5129-33, 5421-22, 5440, 5507- H 10, 5662, 5806-5807, 6245, 6246, 6265, 6398 and 6684{81. fUsliAMBHAR DAYAL v. U. P. STAtE 114~ A (i) VVP. ~os. 3592, 3353t 5396, 6016, 6247-48, 6616, 6668 and 6798/81. .. ( j) VVP. ~os. 5003, 4453, 4455-56, 5346-48, 4955, 5082-89, 5577-80, 5581 and 5724/81. (k) VVP. Nos. 3489 and 4293/82. 8 (l) .. VVP. No. 4818/81. (m) WP. Nos. 2916, 2932, 3242, 3297-3302, 3334-43, 3475, ~ 4098-4100, 4136, 4304, ~. 4\87, 4777, 5007-17, 5027-34, 5352-55, 5473-79, 5604-5608, 5740-42, 5743-44, 5821, c - 6012-13 and 5583-92/81. (n) WP Nos. 5391 and 5525/81. (o) WP No. 5443/81. .

-.... ,. D (p) WP. Nos. 5444, 5663 and 6266/81. • (q) WP. No. 5464/81. (r) WP. Nos. 5451 and 5564-66/81. (s) WP. No. 5807/81. E > ) oRts [1982]1 s. C. k. A (f) WP. Nos. 5841-50/81. {g) WP. Nos. 5656-58/81. ) (Under Article 32 of the Constitution of India) 8 Hari Sarup, M. N. Phadke, Soli J. Sorabjee, J. P. Goyal and C. M. Lodha, (M/s. B. Datta, R. A. Gupta, Miss Kamini Jaiswal, Rajiv Dutta, Manoj Swarup and Miss Lalita Kohli, / R. S. Sharma, R. K. Jain, Pankaj Jain, P. K. Jain, K. K. Jain, K. B. Rohatgi, B. R. Kapur, B. S. Tawakley, S. R. Srivastava, c N. N. Sharma, A. K. Goel, Mitter and Mitter and Co. , S. K. - Jain, Rajesh Jain, Mukul Mudgal, M. Qamaruddin, Mrs. M. Qamaruddin, Anis Suhrawardhy, A. P. Mohanty, K. K. Gupta, Ravi Prakash Gupta, C. K. Ratnaparkhi, S. C. Birla, M. C. Dhingra, and S. K. Gambhir for the appearing Petitioners. D G. N. Dikshit, O. P. Rana, Mrs. Shobha Dixit, R. N. Poddar, G. Gopalakrishan, A. V. Rangam, B. D. Sharma, D. P. Mohanty and A.

Shroff for the Respondents. E · The Judgment of the Court was delivered by SEN, J. The issue in this and the connected 505 petitions under Art. 32 of the Constitution is of far-reaching significance. It raises questions of the highest importance as to the scope and extent of the executive power of the State under Art. 162 of the Constitution, in F relation to regulation and control of trade and commerce in food- stuffs. It necessarily involves a claim by the petitioners who are wholesale dealers of foodgrains that the exercise of such governmental power conflicts with the rule of law and is in flagrant violation of the freedom of trade, commerce and intercourse guaranteed under Art. 301 of the Constitution and the fundamental right to G carry on trade and business guaranteed under Art. 19 (1) (g) of the Constitution.

These petitions fall into two distinct and separate categories, one by the wholesale dealers of foodgrains from the Union Territory of Delhi and the neighbouring States of Punjab and Haryana, and the other by the wholesale dealers of foodgrains from H the State of Uttar Pradesh. BISHAMBHAR DAYAL V. U. P. STATE (Sen. J. ,) 1147 The short question that falls for consideration in some of the A . writ petitions by wholesale dealers of foodgrains from the Union ·Territory of Delhi and the State of Punjab and Haryana is whether . the action of the State Government of Uttar Pradesh in setting up 'check-posts on its borders and the stoppage ~nd seizure of wheat in transit through the State of Uttar Pradesh during the course of inter- :state trade and commerce to various destinations in the States of B Madhya Pradesh and Maharashtra at the check-post at Saiyan on the borde~.

between the States of Uttar Pradesh and Madhya Pradesh • on tne strength of its instructions conveyed by its teleprinter message dated March 31, 198l, was in violation of Art. 301 of the Constitution. c ·'· In a majority of the writ petitions by wholesale dealers from the State of Uttar Pradesh, two questions arise, (I) whether Notifi- ·cation No. P-XXIX-Food-5-5 (42)/80 dated April 21, 1981, issued by the State Government of Uttar Pradesh, in exercise of the powers conferred by s. 3 read with s. 5 of the Essential Commodities Act, 1955 (hereinafter referred to as the Act) , by which 'c1. 4 of the Uttar D Pradesh Foodgrains (Procurement and Regulation of Trade) Order, 1978, ~has been amended, providing that no wholesale dealer, commission agent or retailer shall have in stock wheat more than 250 quintals, 250 quintals and 20 quintals respectively, at any time, anfringes the fund amental right to carry on trade or business guaranteed under Art.

19 (1) (g) and (2) whether the governmental instructions E conveyed by its teleprinter message dated March 31, 1981, placing I ) restrictions on movement of wheat by traders on private account from the State of Uttar Pradesh to various other States and on interdistrict movement of wheat within the State, were in breach of the fundamental right under Art. 19 (1) (g) read with Art. 301· of the F Constitution, The following are the facts and circumstances so far as necessary to show as to how the legal questions are presented.

It would be convenient first to deal with the writ petitions filed by the wholesale dealers of foodgrains from the Union Territory of Delhi and the G States of Punjab and Haryana seeking a declaration that the impug~ ned action of the State Government of Uttar Pradesh in setting up check-posts on the borders of the State and directing seizure of wheat in transit through the State, on the strength of the impugned teleprinter message, conflicted with the guarantees of inter-State H trade and commerce dealt with by Art. 301 of the Constitution. 114~ SUPReME COUin REI'OR. IS [1982] 1 s. c. R. A Facts in all these cases are more or less similar.

The petitioners who are wholesale dealers of foodgrains from the Union Territory of Delhi and the States of Punjab and Haryana allege that between April 29-30, 1981, they, acting as commission agents, purchased wheat from the open market in Delhi and elsewhere and despatched the same by trucks to various destinations in the State of B Maharashtra and to some places in the State of Madhya Pradesh. According to them, the trucks laden with wheat were accompanied by relative bills, goods receipts, inter-State transit passes etc. , duly crossed the check-post at Faridabad and were also allowed to cross the check-post at Kotwan on the border between the Union Territory of Delhi and the State of Uttar Pradesh and were on their c way to thei! respective destinations. They allege that the Senior Marketing Inspector, Agra, intercepted the trucks in question at the check-post at Saiyan on the border between the State of Uttar Pradesh and Madhya Pradesh between April 30, 1981, and May 2, 1981.

The seized trucks were brought back to the purchase point at Ag1 a and the wheat was unloaded. Thereupon, the petitioners D rushed to Agra and made an application on May 4, 1981, under s. 6A read with ss. 3 and 7 of the Act before the Additional District Magistrate (Civil Supplies), Agra, for the release of the seiz~d wheat. In the said application, the petitioners, inter alia, claimed and unequivocally stated that there was no ban on export of wheat from the Union Territory of Delhi to other States, that the wheat in question E was neither purchased at Agra, nor was it being transported from Agra to any other district in Uttar Pradesh, that Agra was a place in transit, and that the instructions of the State Government contained in the impugned teleprinter message dated March 31, 1981 did not constitute a validly notified order under sub-s. (5) of s. 3 of the Act.

F The Chief Marketing Inspector, Agra, had in the meanwhile seized 42 trucks laden with wheat either at the check-post at Saiyan or at Agra and lodged first information reports at the Saiyan police station or at the Civil Lines police station in respect of the consign· .... ' ments alleging that the movement of wheat was in contravention of G the impugned teleprinter message and was therefore seized, and in three of them it was alleged that the wheat had been purchased at Agra. On the report of the Chief Marketing Inspector, the AddiM tiona! District Magistrate (Civil Supplies), Agra drew up proceedings under s. 6A of the rAct ~and directed the police to complete the H investigation within 15 days. BISitAMBAHR DAYAL v. i;. P. STATE (Sen, J. ) 1149 On May 23, 1981, the Additional District Magistrate (Civil A Supplies), Agra under sub-s. (2)(i) of s.

6A of the Act passed interim -- orders for the sale of the seized wheat as it was subject to speedy and natural decay, at the request of the Senior Marketing Inspector, similar to the one reproduced below : B These proceedings under s. 6A of the Essential Commo· dities Act started on the report of SMI Saiyan dated 30. 4. 1981 ( Paper No. 1 ) whereby it was brought to the notice of this Court that truck nos..... were caught carrying 120 quintals...... of wheat respectively beyond Saiyan border outside the State in contravention of the order! ; issued by c the Government vide telex No. 1061/29-Food-5 dated 31. 3. 1981 F. I. R. was lodged at P. S. Saiyan in respect of the above contravention. Notice under s. 6B of the EC Act was issued to the O. Ps...... who were driving the trucks at the time of search and seizure.

J - D Replies were filed by the owners of the wheat contending that the said rules were not part of any Control Order under Section 3 of the EC Act nor they bad any legal sanction for want of publication in the Official Gazette. The O. Ps. have pleaded that they were taking their goods in transit through Agra and in fact the movement of wheat so E made by them wa:. inter-state movement which was not banned by the Central Government or State Government. I heard the learned counsels on behalf of the O. Ps. and the learned PO as well. In these proceedings final orders cannot be passed at this stage as the matter is still under F -investigation. • PO directed to put up progress of investigation within 15 days from now. G In the meanwhile I order that the wheat seized by SMI Saiyan be got purchased at the Official Price so that the same does not get damaged. The sale proceeds be got deposited in Government Treasury under proper Head of Account. H _;.

--- 1150 SUPREME COURt REPORTS [1982]1 s. c. ft. A This interim order is being passed under sub-s. (2) (i) vf s. 6A of the Essential Commodities Act, 1955. File be put up after 15 days along with report of prosecuting office regarding progress of investigation. Sd/- 8 N. N. Varma Addl. Collector, Agra 23. 5. 1981 The seized wheat has been purchased by the State Government on Government account at the procurement price and the sale proceeds c credited into the Treasury. - The State Government has filed a counter-affidavit ofthe Chief Marketing Officer, Lucknow, in all these cases as also the affidavits of the Senior Marketing Inspectors at Agra controverting the allega- -' tions made by the petitioners. It is stated that the source of the D power to effect the seizure was not the impugnecl teleprinter message, but the power of search and seizure conferred on an E~f01;cement + Officer und~r cl. 6 of the U. P. Foodgrains Dealers (Lice~s!

~g and Restrictton on Hoarding) Order, 1976 and under cl,6 of the Uttar Pradesh Foodgrains (Procurement and Regulation of Trade) Order, 1978 (hereinaft~r called the 1976 ,Order and 1978 Order respectively), E both of which were issued by the State Government, in exercise of the powers under s.. 3 of the Act, read with Government of India, Ministry of Agriculture (Department of Food). Notification No. G. S. R. 888 dated June 28, 1961, No.. GSR 316 (E) dated June 20, 1972, No. GSR 452 (E) dated October 25, 1972, No. GSR 168 (E) dated March 13, 1973 and No. GSR 800 dated June 9, 1978 respectively, F since it was of opinion that it was necessary or expedient so to do for securing the equitable distribution and availability of foodgrains at • fair prices. The State Government contends that the impugned teleprinter message dated March 31, 1981 was in the nature,of an executive instruction issued by the State Government under its undoubted powers under Art.

162 of the Constitution for the due observance of the provisions of the two Control Orders. It is said that no person can carry on business in foodgrains as a dealer or as a ,commission agent except under and in accordance with the terms and condJtions of a valid licence issued in that behalf under ct. 4 of the '1976 Qrder. It is also said that no wholesale dealer, commission agent odrader H can have in stock more than 250 quintals, 250 quintals and 20 quintals respectively, at any time. It is asserted that the State Govern- thSHAMBBAR DAYAL v. U. P. STATE (Sen, J. ) 1t5i ment has the right to set up check-posts for the purpose of verifi- A cation so that there is no contravention of the provisions of the two Control Orders, particularly with a view to ensure that excess quantity of wheat is not transported in violation of the 1978 Order to other districts or other States.

The State Government in the counter-affidavit of the Chief B Marketing Officer, Lucknow, specifically denies the allegations made by the petitioners that the 42 trucks laden with wheat seized at the check-post at Saiyan on the border between the States of Uttar Pradesh and Madhya Pradesh or at Agra were in transit during the course of inter-State trade and commerce. c With regard to the seizure of the wheat, it is averred in para 13 of the counter-affidavit: "The correct fact is that the authority on the bona fide ,, apprehension that the wheat so moved actually was purcha- . sed from the State of Uttar Pradesh from nearby places D and the same was being moved to other States on the garb of outside wheat. It is submitted that such traders who are exporting wheat alleged to have purchased from places other than the State of Uttar Pradesh and were/are carrying the same to other States, have only to satisfy the authorities concerned ofthe bona fides of such transactions.

However E there is no · ban on such movement from one State to another. " As regards the check-posts, it is submitted that the State Govern· mentis committed to provide price support in wheat to farmers at Rs. 130 per quintal. This commitment also ·involves purchase of F wheat directly from the farmers without interference from traders/ • middlemen, who try to purchase wheat from the farmers at . lower prices and sell the same at Government purchase centres with sub- · stantial profits. Such transactions are effected in fictitious names,, This not only frustrates the procurement policy of the Government G butalso prejudicially and financially affects the producers' interests. In para 5 it is accordingly averred : . . ( "In order to curb the above tendencies and preventing the activity of traders /middlemen the State Government H ~ have provided a simple system of verifying all transactions by traders. · · ·· .. ;·) .. ' . 1: . • ii52 [i98i1 i s. c. k.

A This procedure involves getting all transactions of wheat verified by the Deputy Regional Marketing Officer indicating inter alia the name of the persons to whom the stocks are sold, their licence numbers etc. and quantum of stocks sold, price paid etc. This process will make it simultaneously very difficult for traders to buy at low price from B farmers and resell at high prices at the Government purchase centres. " As regards the impugned teleprinter message it was stated that it was issued by the State Government in order to sustain and maintain and maximise the procurement of wheat by introducing a c system of verification at the check-posts. -- The State Government contests the right of the pettuoners falling in the first category, that is, wholesale dealers of wheat from the Union Territory of Delhi and the States of Punjab and Haryana, to relief under Art. 32 of the Constitution who question the legality D and propriety of the seizures.

It is a matter for investigation which is pending before the Additional District Magistrate (Civil Supplies), Agra and, according to it, the question cannot be decided without full itr... estigation into facts. In support of the writ petitions, learned counsel appearing for the petitioners have, in substance, urged three grounds. (1) There E was nothing to prevent the State Government from making a law placing reasonable restriction on the freedom to carry on any occupation, trade or business guaranteed under Art. 19(1) (g) read with Art. 19(6) of the Constitution, or on the freedom of trade. commerce and intercourse, throughout the territory of India, guaranteed under Art. 301 of the Constitution, but the restriction must F be by "law" or by an "order having the force of law" and not by recourse to the executive authority of the State under Art. 162 of the Constitution, i. e. , by an executive action.

(2} The seizure of the consignments of the wheat, while they were in transit in the course of inter-State trade and commerce from the Union Territory of Delhi and the States of Punjab and Haryana to various desti- G nations in the States of Maharashtra and Madhya Pradesh, was without the "authority of Jaw" and in violation of Art. 300A of the Constitution. The seizure of the wheat being wrongful, the petitioners were entitled to an appropriate writ, direction or order for the return of the seized wheat or the price thereof. (3) The impugn- H ed teleprinter message of the State Government dated March 31, 1981 on the basis of which the seizures were effected, in truth and BISHAMBHAR DAYAL v. U. P. STAT!! (Sen, J. ) 11S3 A sub~tance, had no legal sanction and cannot be construed to be a notified order within the meaning of sub-s. (I) read with sub-s. (5) of s. 3 of the Act: it was nothing but an executive direction.

No executive action which operates to the prejudice of a citizen can be taken without the authority of taw. It was asserted that the seizures effected were in compliance of the instructions contained in the 8 impugned teleprinter message and not for breach of the two Control Orders and therefore it was nothing but a "colourabte exercise" of power. , The real purpose of the seizure was procurement of wheat in furtherance of the directives of the Central Government, without any legal sanction since the farmers were not willing to sell their wheat at the procurement price. c Learned counsel fllr the petitioners also challenge the action of the Additional District Magistrate (Civil Supplies) Agra in passing an interim order in terms of sub-s. (2) (i) of s. 6A of the Act for the sale of the seized wheat on Government account and for the sale proceeds to be credited into the treasury in an appropriate Head ' .. ,. D of Account; it is urged that under sub-s. (2) Iii) of s.

6A of the Act there being no control price for wheat, the wheat should have been sold by public auction. In reply, learned counsel for the State has repelled all these conten ions. It is submitted that the source of power to effect the E seizure was not the impugned teleprinter message, but the two Control Orders issued under s. 3 of the Act. He asserted that the wheat in question was not being transported during the course of inter-State trade and commerce from the Union Territory of Delhi and the States of Punjab and Haryana to various other States. The wheat had in fact been purchased at Agra and was being lifted from F the State of Uttar Pradesh and had, therefore, to be seized at the -check-post at Saiyan and at Agra. He points out that under cl. 3 • of the 1976 Order, no person can carry on business as a dealer or commission agent, except and in accordance with the terms and conditions of a licence issued in that behalf by the licensing authority.

According to him, the seized wheat had been purchased at G Agra in the course of trade, and they were not isolated transactions and, therefore, the Delhi traders committed contravention of cl. 3 of the 1976 Order. It is also pointed out that ct. 4 of the 1978 Order, as amended, provides that no person who is a wholesale dealer, commission agent or retailer shall have in stock wheat in H quantities exceeding 250 quintals, 250 quintals and 20 quintals at a time. It is further pointed out, cl. 14 of the 1976 Order, and cl. 6 1154 SUPAEME couRT REPORTS ·· •' · '" ' '· [1982] I s. c. R. A of the 1978 Order confer the power of search and seizur~ on an enforcement officer or the licensing authority or any other officer authorised by the Government in that behalf, and the expression "enforcement officer'' defined in cl. 2 (e) of the former Order ··a~d cl.. 2(d) of the latter, includes the Chief Marketing Inspector.

According to the learned counsel the Government instructions con- 8 veyed in the impugned teleprinter message is merely in the nature of an executive instruction for the enforcement of the two Control Orders. In support of the contentions, he a,lso relies on the executive power of the State under Art:· J62 of the Constitution. In the premises, the contention on behalf of the State is that the question whether the seized wheat was liable to be confiscated or not under c I s. 6A of the Act, was _a matter pending ~djudication. be~ore the - Additional District Magi_strate (Civil Supplies) Agr~. Tbafdepends on whether 0~ not there was contrave~tion by the petitione'rs of ~~y of the Order issued under s. 3 of the Act and, therefor~, . carinotj),e determined without full investigation into t_he facts. . . ~; ;~ D The Inter-Zonal Wheat (Movement Control) Order, ~ 97~~ issued by the Central Government. in exercise of the powers con~ ferred by s.

3 of the Act has been rescinded with effect from April 13, 1977. The result of this is that the whole country constitutes a single zone for free movement of wheat except ·in such States where E an order is issued under s. 3 read with s. 5 of the Act, placing a ban on export of wheat such as in the State of Rajasthan.. Admittedly~ the State Government of Uttar Pradesh has not issued any order under s. 3 read with s. 5 of the Act, placing a ban on export of wheat from the State or any restriction on inter·district movement of wheat within the State. The State Government does . nbt contest F this position and indeed, the Chief Marketing Officer in, his counter~ affidavit states : ' - "The State of Uttar Pradesh has not banned the move- · ment of wheat outside the State' or from one district to another district within the State.

It is submitted that sueh traders who are transporting wheat alleged to be purchased ·; G from a place other than the State of Uttar Pradesh and werefare carrying the same to other States other· th age is not relatable to the two Control Orders, the State Government undoubtedly could, in exercise of the executive power of the State, introduce a system of verification on movement of wheat from the S! atc of Uttar Pradesh to various other States at the check-posts on the bc)rder and place restrictions on inter-district movement of wheat by traders on private account within the State. The executive power of a modern State is not capable of any precise definition. 1 In Ram . lawaJ·a Kapur v. State of Punjab( ), Mukherjea, C. J. , dealt \'v·ith the scope of Arts. 73 and 162 of the Constitution. The learned Chief Justice observed that neither of the two Articles contains any H (I) (1955] 2 S. C. R. 225, BlSHAMBi:tAR bAYAL v. U. P. STATE (Sen, J.

) 1157' definition as to what the executive function is or gives an exhaustive enumeration of the activities which would legitimately come within its scope. It was observed : "Ordinarily the executive power con~ notes the residue of governmental functions that remain after legislative and judicial functions are taken away". It is neither necessary nor possible to give an exhaustive enumeration of the kinds and categories of executive functions which may comprise both the 8 formulation of the policy as well as its execution. In other words. the State in exercise of its executive power is charged with the duty and the responsibility of carrying on the general administration of '* the State. So long as the State Government does not go against the provisions of the Constitution or any law, the width and ampli- - tude of its executive power cannot be circumscribed.

lf there is no c enactment covering a particular aspect, certainly the Government can carry on the administration by issuing administrative directions or instructions, until the legislature makes a law in that behalf. Otherwise, the administration would come to a standstilL In Ram Jawaya Kapoor's case (supra) it was contended that 0 the executive power of the State did not extend to the carrying on of trade of printing, publishing and selling of text~books for schools unless such trade was authorised by law. In repelling the conten~ . 1 tion, Mukherjea, C. J. speaking for the Court, observed :( ) Our Constitution, though federal in its structure, is modelled on the British Parliamentary system where the 1 executive is deemed to have the ~primary responsibility for the formulation of governmental policy and its transmission into law though the condition precedent to the exercise of this responsibility is its retaining the confidence of the - legislative branch of the State.

The executive function F comprises both of the determination of the policy as well as carrying [it into execution. This evidently includes the initiation of legislation, the maintenance of order, the pro~ motion of social and economic welfare, the direction of foreign policy, in fact the carrying on or supervision of the general administration of the State. · G The learned Chief Justice then went on to observe :f) · The Indian Constitution is a written Constitution and even the legislature cannot override the fundamental rights (1) [1955) 2 SCR 225@ 2:16 (2) Ibid @239. t lS8 SUPREME COtJitt REPORTS [I9S~] I s. C. k. guaranteed by it to the citizens. Consequently, even if the acts of the executive are deemed to be sanctioned by the legislature, yet they can be declared to be void and inoperative if they infringe any of the fundamental rights of the petitioners guaranteed under Part III of the Constitution.

On the other hand, even if the acts of the executive 8 are illegal in the sense that they are not warranted by law, but no fundamental rights of the petitioners have been infringed thereby, the latter would obviously have no right to complam under article 32 of the Constitution though they may have remedies elsewhere if other heads of rights are infringed. c In Naraindas Indurkhya v. State of Madhya Pradesh & Ors(l) - Bhagwati, J. , speaking for the Court, reiterated the principles laid down by Mukherjea, C. J. in Ram Jawaya Kapur's case (supra) and held that the State Government could act in exercise of the executive power of the State under Art. 162 of the Constitution in rela- D tion to any matter with respect to which the State Legislature has power to make laws even if there was no legislation to support such executive action. There is no denying the fact that the State Legislature is competent to enact a law on the subject covered by Entry 33, List III, which reads : E 33.

Trade and commerce in, and the production, supply and distribution of,- (b) foodstuffs, including edible oilseeds and oils. The Essential Commodities Act, 1955 was enacted by Parlia· F ment in exercise of concurrent jurisdiction under Entry 33 List III of the Seventh Schedule to the Constitution as amended by the Constitution (Third Amendment) Act, 1954. The exercise of such concurrent jurisdiction would not deprive the State legislature of its jurisdiction thereunder. The State legislature, therefore, could still make a law on the subject regulating trade and commerce in, G. and the production, supply and distribution of 'foodstuffs' and the only question that would arise is one vf repugnancy dealt with in Art. 254 of the Constitution. The executive power of the State being co-extensive with its legislative powr. r under Entry 33, List llJ, it relates to all matters covered by the subject 'foodstuffs', H (I} [1974] 3 SCR 624. . - ... BtSHAMBHAR DAYAL v. U. P. STATE (Sen, J.

) I 159 A trade and commerce in, and the production, supply and distribution thereof. This is, of course, subject to the limitation contained in Proviso to Art. 162 which directs that in any matter with respect to which the legislature of a State and Parliament have power to make laws, the executive power of the State shall be subject to, and limited by, the executive power expressly conferred by the Constitution or B by any law made by Parliament upon the Union or authorities thereof. This leads us to another aspect of the problem of considerable difficulty and importance. The subject 'search and seizure', is a field which has not come before the court with considerable fre~ quency, but this is a hard fact of life which the citizen does encounter very often. The executive power of 'search and seizure' is a neces~ sary concomitant of a welfare State. It tends to promote the well~ being of the nation. Many questions arising in the field of search and selzure are factual in nature.

They involve varying degrees of difference among the infinitely diverse facts. Every factual variation D presents not only a new problem, but also a new constitutional question. It is a limitless area in which different issues may arise with vast variations of facts which are involved in each individual case. This is, indeed, a peculiar field in which the decisions of courts do not help in clarifying the law. The decisions in the field are of little precedental value because, the more the cases that are E decided, the more new issues arise, through possible factual variations. The check-posts and barriers on the borders of the State of Uttar Pradesh are set up under s. 28 of the U. P. Sales Tax Act, 1948 and are designed and meant to prevent evasion of sales tax F and other dues. The constitutional validity of s. 28 and its cognate -- provisions, ss. 28A to 28C has, rightly, if we may say so, not been challenged before us. From the point of view either of Entry 54, List II, or of Art.

301 of the Constitution, there is no question of any lack of competence in the State legislature to set up the check~ posts and barriers on the State's borders. These provisions, read G with the requirements ofr. 83(4) of the U. P. Sales Tax Rules, 1948 require that the owner, driver or any other person in-charge of the vehicle or vessel shall, in respect of such goods c;:arried in the vehicle or vessel as are notified under sub-s. (1) of s. 28A, carry with bim, a declaration in Form XXXI, a certificate in Form XXXII, a transit H pass in Form XXXIV in duplicate, cash memo, bill of sale or challan and a trip-sheet in triplicate. The factual existence of these check~ tt6o SUPREME coURt REI•o. ltts {1982] I s. c. ft A posts or barriers on the State's borders is not denied, nor their legality challenged. It is not suggested that the setting up of these check-posts is a restriction on the freedom of trade, commerce and intercourse guaranteed uncer Art.

301 of the Constitution, or is stich as directly and immediately restricts or impedes the free flow or movement of goods. It is also not suggested that these regula. B tory measures in setting up the check-posts on the State's borders are su~h as impede freedom of trade, commerce and intercourse. Just as inter-State trade and commerce must pay its way and be subject to taxation, persons engaged in such inter-State trade or commerce are equally subject to all regulatory measures. There is no reason why the check-posts or barriers set up by the State Government under s. 28 of the U. P. Sales Tax Act, 1948, cannot be utilised a~ a machinery for due observance of the laws, e. g. for verification and control of movement of wheat by traders on private account from the State of Uttar Pradesh to various other States.

The instructions conveyed by the State Government by the D impugned teleprinter message dated March 31, 1981, were a direct sequel to the Centre's directives contained in its earlier teleprinter message. It was intended and meant to achieve three main objectives, namely, (1) to provide price support in wheat to purchasers with a view to sustain, maintain and maximise the procurement of wheat; (2) to prevent hoarding and blackmarketing; and (3) to E provide for equitable distribution and availability of wheat at fair prices. These directions were obviously meant to subserve the object of the legislation and were in public interest. These cases were argued with much learning and resource particularly with reference :to the rule of law and the consequent F limitations on the executive power of the State under Art. 162 to 'trench' upon the fundamental right to carry on trade or business guaranteed under Art.

19 (I) (g) and the freedom of trade, commerce and intercourse throughout the territory of India guaranteed under Art. 301 of the Constitution. It necessarily involves a claim by the State that the measures ·. taken by tbe State Government by G the impugned teleprinter message were nothing but regulatory measures to ensure that the excess stock of wheat held by a wholesale dealer, commission agent or a retailer is not transported to a place outside the State or from one district to a not her within the State and therefore were not a 'restriction' on the fundamental right 1o H carry on trade or business guaranteed under Art. 19 (I)(g) or on the freedom of trade, commerce and intercourse under Art. 301. 81SHAMBHAR DAYAL v. U. P. STATE (Sen, J. ) ] H'il A The quintessence of our Constitution is the rule of law. The State or its executive officers cannot interfere with the rights of others unless they can point to some specific rule of law which authorises their acts.

In Srate of Madhya Pradesh v. Thakur Bharat Singh(~), the Court repelled the contention that (by virtue of Art. 162, the State or its officers may, in the exercise of executive authority, without any legislation in support thereof, infringe the rights of citizens merely because the legislature of the State has power to legislate in regard to the subject on which the executive order is issued. It was observed : "Every act done by the Government or by its officers c must, if it is to operate to the prejudice of any person, be supported by some legislative authority. " The same principle was reiterated by the Court in Satwant Singh Sawhney v. Dr. Ramarathnam, Assistant Passport Officer, Government ofIndia, New Delhi & Ors(2), and Smt. Indira Nehru Gandhi v. Shri Raj Naraine). D There can be no doubt that the Essential Commodities Act, • 1955, is a 'law' within the meaning of Art.

302 of the Constitution imposing reasonable restrictions on the right to carry on trade and commerce as guaranteed by Art. 19(1)(g) and Art. 301 of the C0nstitution. The object of the Act is to provide, in the interests E ofthe general public, for the control, production, supply and distribution of, and trade and commerce in, certain essential commodities. To appreciate the points involved, it is necessary to set out the material statutory provisions. Sub-s. (I) of s. 3 of the Act provides as follows : F "3(1). 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, or for securing any essential commodity for the defence of India or the efficient conduct of military opera- . G tions, it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof and· traue and commerce therein.

'' (1) [1967] 2 SCR 454. H (2) [1967] 3 SCR 525@ 542. (3) [1976) 2 SCR 347@ 524. 1162 SUPREME COURT REPORTS [1982ll s. c. tt A Sub~s. (2) thereof provides that without prejudice to the generality of the powers conferred by sub~s. (I) an order made thereunder may provide for any of the matters enumerated therein. Sub~s. {5) provides that any order made under this section shall in the case of an order of a general nature or affecting a class of persons, be notified in the Official Gazette. By virtue of the delegation of 8 powers under s. 5 of the Act the State Government in relation to such matters and subject to such conditions as may be specified, may exercise the powers of the Central Government under s. 3 Clause (j) of sub·s.

(2) of 3 provides that the Central Government or the State Government, as the case may be, may by order provide: c "For any incidental and supplementary matters, includ- ing, in particular, the entry, search or examination of premises, aircraft, vessels, vehicles or other conveyance and animals, and the seizure by a person authorised to make such entry, search or examination ...... ' D Sub-ss. (1) and (2) of s. 6A of the Act, insofar as material, provide as follows : "6A(l).

Where any essential commodity is seized in pursuance of an order made under section 3 in relation thereto, a report of seizure shall, without unreasonable delay, be made to the Collector of the district or the E Presidency-town in which such essential commodity is seized and whether or not a prosecution is instituted for the contravention of such order, the Collector may, if he thinks it expedient so to do, direct the essential commodity so seized to be produced for inspection before him, and if he is satisfied that there has been a contravention of the order, F may order confiscation of- (a) the essential commodity so seized; 6A(2). Where the Collector, on receiving a report of seizure or oa inspection of any essential commodity under G sub~s.

{1), is of the opinion that the essential commodity is subject to speedy and natural decay or it is otherwise expedient in the public interest so to do, be may- (i) order the same to be sold at the controlled price, H if any, fixed for such essential commodity under this Act or under any other law for the time being in force; or BISHAMBHAR DAYAL V. U. P. STATE (Sen, 1. ) 1163 (ii) where no such price is fixed, order the same to be A sold by public auction: Provided that in case of foodgrains, the Collector may, for its equitable distribution and availability at fair prices, order the same to be sold through fair price shops 8 at the price fixed by the Central Government or by the State Government, as the case may be, for the retail sale of such foodgrains to the public. '' Learned counsel for the State Government, in all fairness, does not assert that the impugned teleprinter message having regard c - to the requirements of sub-s. (5), has the effect of a notified Order under s.

3 of the Act placing a ban on export of wheat from the State or imposing a restriction on inter-district movement of wheat. It is submitted that it only conveyed the instructions of the State ; .... , Government requiring the Regional Food Controllers to be more D vigilant to secure due observance of the laws. The question still remain whether the instructions conveyed by the teleprinter message had the force of Jaw. It is therefore to be considered whether the instructions conveyed by the State Government by the impugned teleprinter message E were relatable to the two Control Orders and therefore could be considered to be 'law' or an order having the force of law placing reasonable restriction on the freedom to carry on any occupation, trade or business guaranteed under Art. 19(1 )(g) read with Art. 19(6) of the Constitution or on the freedom of trade, commerce and intercourse throughout the territory of India guaranteed under Art. F 301 o the Constitution.

It is further to be considered whether the seizure of wheat in transit was with authority of law. It is submitted that although the impugned teleprinter message dated March 31, 1981 was in the nature of executive instructions of the State Government to the Regional Food Controllers of the various regions to secure compliance with the two Control Orders, G it had the force of law. It is pointed out that under licence con· ditions Nos. 11, 12 and 13 of the licence issued in Form B under cl. 4 of the 1976 Order, a dealer is required to comply with any direction that may be given by the State Government in regard to purchase, sale or storage for sale of foodgrains, to furnish such H information relating to his business as may be demanded of him and to carry out such instructions as rna¥, fro~ tim tber Stat~s Ql' from one BISHAMHAR DAYAL v. U. P. STATE (Sen, J.

) 1175 A district to another within the State, subject to the making of an endorsement by the Deputy Marketing Officer or the Senior Marketing Officer concerned. The petitioners who are wholesale dealers of foodgrains in the State of Uttar Pradesh are, therefore, free to carry on their business within the permissible limits, i. e. , they may carry on their trade or business or enter into inter-State or intra- 8 State transactions of wheat subject to the stock limit of 250 quintals at a time. In the result, the writ petitions must fail and are dismissed. The stay orders passed by the Court, from time to time, stand vacated. Formal orders for vacating stay granted in those matters need not be issued. There shall be no order as to costs. c S. R. Petitions dismissed. •