1989 (1) TMI 361 - SC - Indian Laws

State Order Regulating Groundnut Trade Declared Invalid by Supreme Court

The Supreme Court upheld the High Court's decision, declaring the State Government's Order dated 21.6.1985 regulating the transport and export of ... - Issues Involved:1. Validity of the State Government's Order dated 21.6.1985.2. Violation of Articles 19(1)(g) and 301 of the Constitution.3. Compliance with Section 3(2)(f), Section 3(3)-B, and Section 3(5) of the Essential Commodities Act, 1955.4. Authority under Clause 12 of the Andhra Pradesh Scheduled Commodities Dealers (Licensing & Distribution) Order, 1982.Summary:1. Validity of the State Government's Order dated 21.6.1985:The appeals challenge the High Court's decision quashing the State Government's Order dated 21.6.1985, which regulated the transport and export of groundnut seeds and oil. The Order required oil millers and traders to deliver oil to the State Government at a fixed price in proportion to the quantity transported outside the State. The High Court found the Order to be in violation of the Essential Commodities Act, 1955, as it imposed a compulsory levy without the prior concurrence of the Central Government.2. Violation of Articles 19(1)(g) and 301 of the Constitution:The learned single Judge quashed the State Government's Order on the grounds that it violated Articles 19(1)(g) and 301 of the Constitution, which guarantee the right to practice any profession and free trade across the country. However, the Division Bench did not record any finding on this constitutional issue.3. Compliance with Section 3(2)(f), Section 3(3)-B, and Section 3(5) of the Essential Commodities Act, 1955:The Division Bench held that the State Government's Order was violative of Section 3(2)(f), Section 3(3)-B, and Section 3(5) of the Essential Commodities Act, 1955. The directions amounted to an imposition of levy, which required the prior concurrence of the Central Government. The State Government's actions were found to be in excess of the delegated powers under the Act and the Notification dated 9.6.1978.4. Authority under Clause 12 of the Andhra Pradesh Scheduled Commodities Dealers (Licensing & Distribution) Order, 1982:The appellants contended that the directions were issued under Clause 12(2) of the 1982 Order, which was made with the prior concurrence of the Central Government. However, the Court found that Clause 12 did not confer authority to impose restrictions on transport, levy, or price fixation. The directions issued by the State Government were outside the purview of the 1982 Order and thus illegal and void.Conclusion:The Supreme Court upheld the High Court's decision, finding no merit in the appeals. The State Government's Order dated 21.6.1985 was declared ultra vires and struck down. The appeals were dismissed with costs.