TMI Blog1984 (1) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... om its 'ERROR JURISDICTION' has been invoked in order to use the hand of the Court for transferring money from the pockets of poor cultivators (who feed the Nation) to the pockets of the dealers in fertilizers (who feed themselves) by Challenging a notification on technical grounds. Such jurisdiction is invoked to enable the dealers to reap a 'rich' harvest of 'unjust enrichment' through the instrumentality of the Court at the cost and expenses of the cultivators. We firmly believe that the Court exercising CONSTITUTIONAL JURISDICTION is not obliged to grant a writ in such circumstances. But we need not elaborate on the theme furthermore as the High Court has rejected the petition on merits and as we are of the same opinion. Events leading to the institution of the Writ Petitions under Article 226 of the Constitution of India giving rise to this group of appeals (by certificate of fitness granted by the Allahabad High Court) have taken the following course: (i) On October 11,1973 the Central Government issued a notification fixing the maximum retail selling price of certain varieties of fertilizers to the consumers. It was issued in exercise of powers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cquired at the lower rates. (v) It was in this background that the dealers instituted the petitions giving rise to the present appeals by certificate, challenging the legality and validity of the impugned notification issued by the State Government on June 14 1974. Now, the following facts are not in dispute: (i) The registered 'dealers' were entitled to a fixed profit margin of ₹ 45 per ton (and no more) under the terms and conditions of the licence held by them. (ii) The stocks acquired prior to June 1 1974 were meant for sale to the cultivators at the pre- upward revision rates at which rates the dealers had acquired the stocks. This stock had remained unsold with the dealers till than because the cultivators had not been able to effect their purchases till that date. (iii) The price rise was authorised to compensate the 'manufacturers' in the context of the spurt in the price of various 'inputs' and had no bearing on the selling price for the 'dealers' who were not concerned with the cost of production. (iv) In case the State Government had not issued the impugned notification dated June 14 1974 the dealers would have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the question of selling prices in respect of sales from out of stocks acquired earlier at the lower rate. Since the said notification issued by the Central Government was silent the State Government which appears to have been more vigilant stepped in and exercised powers which were conferred on it by the DIR. The challenge before the High Court was made on three main grounds, viz: (A) The Central Government having issued a notification in exercise of powers under the Essential Commodities Act 1955 the State Government could not have issued the impugned notification under the Uttar Pradesh Fertilizer Prices (Supplementary) order 1974 issued in exercise of the powers conferred under Rule 114 of the 'DIR. The power to fix the maximum price in respect of fertilizers could be exercised only under the Essential. Commodities Act it being a special Act and could not have been exercised by the State Government by issuing an order under the 'D.I.R.' (B) Even if the State Government had the power to issue the notification under the D.I.R. the notification was invalid by reason of its inconsistency with the notification issued by the Central Government on June 1 1974 un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is altogether immaterial. There is no constitutional or jurisprudential limitation on the competence of the Parliament to create two avenues or sources of power for the regulation of prices of articles. There is nothing in principle or precedent to support the proposition that two avenues or sources of power cannot be validly created. What then is the fabric of the challenge The only answer offered by the counsel is that the Act is a statute specially enacted inter alia for regulation of the prices of commodities declared to be essential and therefore in respect of such commodities the power can be exercised only under the Act. We are unable to accede to this argument Since as discussed earlier Parliament can constitutionally and validity enact two statutes creating two sources of power and since under both the statutes prices of fertilizers can be regulated; there is no illegality in acting under 'either' or 'both'. Counsel however seeks support from the following passage from Craies on Statute Law(1) Acts of Parliament some times contain general enactments relating to the whole subject-matter of the statute and also specific and particular enactments relating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ultivators could not effect purchases till then. In other words the Central notification does not deal with this ramification at all. It does not show awareness of this dimension and is altogether silent on the subject. The impugned State notification issued later on the other hand deals specifically pointedly and solely with this dimension. It is in this perspective that the issue has to be judged bearing in mind the undisputed position that there is no Centre-State conflict involved in the sense that (1) the Centre which is not even impleaded as a party does not question the power of the State or the validity of the notification as impinging on its (Centre's) jurisdiction or authority; (2) Centre has not asserted its superior authority from the standpoint of Centre-State-power equation in order to supersede the State notification. The question clamoring for solution in this scenerio has two facets viz: (1) Whether there is any inconsistency between the Central notification on the one hand and the State notification on the other and; (2) whether the inconsistency is an irreconcilable or intolerable one: Is there inconsistency? The Central notification as discuss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... localities within its jurisdictional scope, prescribing the governing law upon the subject it encompasses, unless a special statute exists to treat a refinement of the subject with particularity or to prescribe a different law for a particular locality. Likewise where a later statute adapted for a particular locality conflicts with a general law of state-wide application, the special or local law will supersede the general enactment. Where, however, the later special or local statute is not irreconcilable with the general statute to the degree that both statutes cannot have a coterminous operation, the general statute will not be repealed, but the special or local statute will exist as an exception to its terms. (Emphasis added) Assuming for the sake of argument that it is considered to be an inconsistency, it does not appear to be an irreconcilable or intolerable one so as to invalidate it, as will be presently shown. Is the alleged inconsistency irreconcilable or intolerable one There are degrees of inconsistency in the context of conflict of laws. There can be apparent or surface inconsistency which may be considered as a non-hostile, tolerable, benign, one, subject to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ially made, is saved from exploitation without hurting the legitimate claim of the dealer, who, in any case, gets his fixed profit margin of ₹ 5/- per ton. In Australian Boot Trade Employee's Federation v. Why brow Co.,(1) the High Court of Australia in a somewhat similar situation held that there was no inconsistency between a State law fixing a minimum wage for workers in the boot trade of 1$ per hour and a federal law fixing a minimum wage for the same workers of 1-1/2 $ per hour. Speaking through Barton, J. the court observed: The determinations of the wages boards (in effect the State law) and the proposed award (in effect, the Commonwealth law) are courched in the affirmative in respect of the material part of each, the provision as to the minimum wage. None of them prescribed an inflexible rate. The (State) determinations prescribe a minimum and it is in each case lower than the minimum named by the proposed (Commonwealth) award. By paying the latter minimum an employer will be obeying both laws. The affirmative words of the (Commonwealth) award, therefore, do not impart a contradiction between it and the (State) determinations. It is impossible to say tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State Government had permitted governmental agencies falling within the definition of 'dealer' in the Fertilizer Control Order, 1957 to sell the stocks held by the said agencies immediately preceding the issuance of the impugned notification dated June 1, 1974 at the higher rates. This allegation has been controverted by the State of Uttar Pradesh. A reference to the counter-affidavit sworn by the Accounts Officer, Fertilizers and Manuals Directorate of Agriculture, field in C.M.P. No. 6773 of 1974 clearly shows that the State Government had not granted any such permission. Thus, the very basis of the challenge on the score of hostile discrimination is found to be non- existent. The High Court was perfectly justified in rejecting this contention. We, therefore, confirm the view taken by the High Court. Thus all the grounds called into aid by the appellant for challenging the impugned notification are found to be devoid of substance. Under the circumstances the appeals fail and are dismissed. Having regard to the facts and circumstances of the case there will be no order regarding costs. The interim orders passed by this Court are hereby vacated. In the result, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icultural Officers and other District Authorities not to ask the dealers to refund the excess in respect of sales completed prior to the date of that notification. The High Court has, while upholding the validity of the notification dated 14.6.1974 and dismissing the prayer for quashing the same, directed the District Agricultural Officers and other District Authorities not to enforce the order for refund of the excess price realized on the sale of fertilizer up to 14.6.1974 from the stocks which were in existence on 31.5.1974. This part of the High Court's order has become final and has not been challenged by the State Government. This Court has directed by orders dated 2.9.1974 and 30.10.1974 that the excess price charged on the sale of fertilizer which was in the possession of the appellants before 1.6.1974 should be deposited with the District Magistrate concerned within a fortnight of the sales to remain in a separate account. The fertilizer in question is admittedly a commodity controlled under the Fertilizer (Control) Order, 1957 issued by the Central Government in exercise of the power conferred by s.3 of the Essential Commodities Act, 19555. The maximum price for sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fertilizers being necessary for increased production of food crops and oil seeds crops under modern scientific methods of agriculture would be commodities essential for the life of the community and that the argument that trade in chemical fertilizers cannot be regulated under s.3 of the Defence of India Act, 1971 is untenable. Before us no argument was advanced by the learned counsel for the appellants that chemical fertilizers are not essential commodities. On the other hand, it was repeatedly contended that it is an essential commodity within the meaning of s.2(1)(a) of the Essential Commodities Act, 1955 and is specifically mentioned as such in s.2(1)(a) (xi) of that Act. There is no dispute before us about this matter though there is dispute whether fertilizer can be brought within the words any article mentioned in Rule 114(2) of the Defence of India Rules, 1971. Therefore, that question does not arise for detailed consideration by us. The second ground of attack before the High Court was that the State Government lacked the power to control the price of chemical fertilizer on the ground that no such power is conferred on it by the Defence of India Act, 1971 and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by its subsequent notification dated 1.6.1974 in which the price fixed for sale of the same variety of fertilizer to dealers was ₹ 1960 per ton from the date of that notification. The price fixed for sale by dealers was ₹ 1050 per ton under the superseded notification dated 11.10.1973 and ₹ 2000 per ton in the notification dated 1.6.1974. The learned Judges of the High Court noted the obvious fact that the dealers would get an excessive margin of ₹ 995 per ton in respect of the old stock purchased by them at ₹ 1005 per ton by selling that stock at the new sale price of ₹ 2000 per ton fixed by the notification dated 1.6.1974, whereas under the notification dated 11.10.1973 their margin was only ₹ 45 per ton. They have expressed the view that it could be a legitimate circumstance to persuade them to exercise their discretion under Article 226 of the Constitution against the appellants. The learned Judges rejected the contention urged on behalf of the dealers that there is conflict of power exercised by the Central Government and the State Government in the same commodity, fertilizer, by the two notifications dated 1.6.1974 and 14.6.1974 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d under the Rules made under the later Defence of India Act, 1971 which also is a Central enactment on the ground that the provisions of the later enactment prevail over those in the earlier enactment of the same legislative body in view of s.37 of the later Act. The learned Judges of the High Court rejected the contention urged on behalf of the dealers that the Essential Commodities Act is a special Act dealing with essential commodities and the Defence of India Act, 1971 is a general Act dealing with all other commodities and, therefore, the notification dated 1.6.1974 issued by the Central Government under the Fertilizer (Central) Order, 1957 made under the provisions of that Act must prevail over the State Government's notification dated 14.6.1974 issued under the Defence of India Rules, 1971, framed under the Defence of India Act, 1971. They have observed that no question of special or general Act arises in these cases in view of the provisions contained in s.37 of the Defence of India Act, 1971 and that s.6 of the Essential Commodities Act, 1955 draws within its ambit only those Acts which were in existence and in force on the date of commencement of that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Constitution. Trade and commerce within the State subject to the provisions of Entry 33 of List III fall under entry 26 of the State List II in the same Seventh Schedule. Fertilizer is an essential commodity under s.2(a)(xi) of the Essential Commodities Act, 1955. The Fertilizer (Control) Order, 1957, has been made in exercise of the power conferred by s.3 of the Essential Commodities Act in respect of fertilizer. Under Clause 3(1) of that Order the Central Government has power, with a view to regulating equitable distribution of fertilizers and making fertilizers available at fair prices, by a notification in the official gazette, to fix the maximum price or rates at which any fertilizer may be sold by a manufacturer or a dealer. The Central Government had issued the notification dated 11.10.1973 fixing the maximum sale price by producers to dealers as ₹ 1005 per ton and the maximum sale price by dealers to consumers as ₹ 1050 per ton in respect of the variety of fertilizer with which we are concerned in these appeals. There is nothing on record to show that when that notification of the Central Government was in force there was any notification of the State Governmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ixing the maximum price of the concerned variety of fertilizer in these terms : No registered dealer shall charge or retain or enter into or enforce any contract for charging, in respect of any fertilizer sold to any person on or after June 1, 1974 a from out of any stock carried over by him from May 31,1974 a price exceeding the maximum price fixed under Clause 3 of the Fertilizer (Control) Order, 1957 as it prevailed on May 31, 1974 . The reference to the price as it prevailed on May 31, 1974 is to the price fixed in the Central Government's notification dated 11.10.1973 which has been specifically superseded by the Government's notification dated 1.6.1974. The High Court has held that the impugned notification dated 14.6.1974 is prospective in operation and can apply only to sales made from 14.6.1974 of the fertilizer which was carried over from the stock held at the close of 31.5.1974. It is not disputed that the notification could be only prospective in operation and would not apply to sales effected up to 14.6.1974 of the fertilizer carried over from the stock which was held at the end of 31.5.1974. It is also not disputed that the State Government issued the impugne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw. Mr. S.C. Manchanda, Senior Counsel appearing for the respondents in all the appeals naturally submitted that there is no substance in any of these two grounds. The second ground of attack projected by Mr. Yogeshwar Prasad may be taken up first for consideration. This ground has been considered by the learned Judges of the High Court as the fifth ground of attack before them at pages 29 to 31 of the paper book in Civil Appeals 1568-1576 of 1974, and rejected by them. The submission of Mr. Yogeshwar Prasad is that some governmental agencies falling within the definition of dealer in the Fertilizer (Control) Order, 1957 were permitted by the State Government to sell the fertilizer carried over from the stock held at the close of 31.5.1974 at the new enhanced rate of ₹ 2000 per ton fixed in the Central Government's notification dated 1.6.1974 and that it is discriminatory against the private dealers who are required by the impugned notification to sell at the old rate of ₹ 1050 per ton fixed in the Central Government's old notification dated 11.10.1973. To show that such a direction was given by the State Government, Mr. Yogeshwar Prasad invited attention t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt. The first ground is as regards the power of the State Government to issue the impugned notification dated 14.6.1974, fixing for the sale of fertilizers by dealers to consumers a price different from the one fixed in the Central Government's notification dated 1.6.1974. In considering this question the fact that the notification was issued by the State Government with the object of preventing dealers in the State of Uttar Pradesh from driving under excessive profit from agricultural consumers in respect of the fertilizer which had been purchased by the dealers at ₹ 1005 per ton under the old Central Government's notification dated 11.10.1973 and that it applies to the fertilizer which was in stock at the end of 31.5.1974, should not weigh with the Court, for the question is of the power of the State Government to issue the notification. The question is whether the State Government has power to fix the price of fertilizer under the Defence of India Rules, 1971, framed in exercise of the powers conferred by the Defence of India Act, 1971 after the Central Government had already fixed the price under the Fertilizer (Control) Order, 1957 made in exercise of the pow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rary enactment intended to be in operation for only a limited period. The Defence of India Rules, 1971 had been issued in exercise of the power conferred by s.3 of the Defence of India Act, 1971. Under Rule 114(2) of those Rules, if the Central Government or the State Government is of opinion that it is necessary or expedient so to do for securing the defence of India and civil defence, the efficient conduct of military operations or the maintenance or increase of supplies and services essential to the life of the community or for securing the equitable distribution and availability of any article or thing at fair prices, it may, by order, provide for regulating or prohibiting the production, manufacture, supply and distribution, use and consumption of articles or things and trade and commerce therein or for preventing any corrupt practice or abuse of authority in respect of any such matter. Sub-rule (3)(h) of Rule 114 said that without prejudice to the generality of the powers conferred by sub-rule (2) an order made thereunder may provide for controlling the prices or rates at which articles or things of any description whatsoever may be sold or hired or for relaxing any max ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commodities Act, 1955, pursuant to which the Fertilizer (Control) Order, 1957 has been made says that without prejudice to the generality of the powers conferred by sub-section (1) an order made thereunder may provide for controlling the price at which any essential commodity may be brought or sold. This sub- clause of s.3 of the Essential Commodities Act has not left anything to be done under the Defence of India Act, 1971 in the matter of fixation of price of any essential commodity whether it be for securing any essential commodity for the defence of India or for the effective military operation or for securing the equitable distribution and availability of essential commodities at fair prices or distribution thereof and trade and commerce therein as envisaged in s.3(1) of that Act. If the State Government felt that there was any special circumstance to be taken into account for fixing the price of the essential commodity fertilizer, in the State of Uttar Pradesh at a rate lower than the one fixed by the Central Government in its notification dated 1.6.1974, it could have achieved that object by getting steps to be taken under the Essential Commodities Act itself. Section 3( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of that Act or any Rule made thereunder or any order made under any such Rule shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than that Act or in any instrument having effect by virtue of any enactment other than that Act. But as stated above, the Defence of India Act, 1971, which was a general and temporary Act and the Rules framed thereunder cannot apply to fertilizer which is an essential commodity governed by the Essential Commodities Act, 1955 and the Fertilizer (Control) Order, 1957 made under the provisions of that Act. Therefore, the State Government cannot without delegation issue any notification under the Defence of India Act and Rules, 1971 in regard to the price of fertilizer an essential commodity governed by the Essential Commodities Act and the Fertilizer (Control) order, 1957. The learned Advocate-General of the State was perhaps fully conscious of the legal position that the State Government cannot fix the price of an essential commodity by any notification under the Defence of India Rules, 1971 in the circumstances when he took the patently unacceptable stand before the learned Judges of the High Court that the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of the State. There is nothing on record to show that the impugned notification of the State Government was placed before the President for his assent and that his assent has been received. Therefore, the State Government's impugned notification even as a law cannot prevail over the earlier notification of the Central Government. The learned Judges of the High Court were not right in rejecting the submission made before them that there is conflict between the two notifications of the Central Government dated 1.6.1974 and of the State Government dated 14.6.1974 and in holding that the State Government has unfettered power under the Defence of India Act, 1971 to fix the price of fertilizer and regulate its supply notwithstanding the fact that fertilizer is an essential commodity under the Essential Commodities Act, 1955 in observing and that what the Central Government can do under the Fertilizer (Control) Order, 1957 the State Government can do under the Defence of India Rules, 1971. There is a clear conflict between the two notifications in respect of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are repugnant, the known rule is that the last must prevail . But, on the general principle that an author must be supposed not to have intended to contradict himself, the Court will endeavour to construe the language of the legislature in such a way as to avoid having to apply the rule, leges posteriors priores contrarias abrogant. For example, the provision in order 47 of the Country Court Rules 1936 that the scale of costs in an action for the recovery of a sum of money only shall be determined.... as regards the costs of the plantiff, by the amount recovered was not construed as peremptory, for this would have brought it out of harmony with the earlier provision in the same order that the costs of proceedings in a Country Court shall be in the discretion of the Court. One way in which repugnancy can be avoided is by regarding two apparently conflicting provisions as dealing with distinct matters or situations. There will be clear conflict between the two notifications if it is understood that the State Government also can fix the price of any essential commodity covered by the Essential Commodities Act, 1955 and the Fertilizer (Control) order, 1957 in exercise of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut meeting and there would be no real conflict though apparently it may appear to be so on the surface. Statutes in pari materia although in apparent conflict should also so far as reasonably possible, be construed to be in harmony with each other and it is only when there is an irreconcilable conflict between the new provision and the prior statute relating to the same subject matter, that the former, being the later expression of the legislature, may be held to prevail, the prior law yielding to the extent of the conflict . If the Essential Commodities Act, 1955 and the Fertilizer (Control) order, 1957 are considered to apply exclusively to fertilizer, an essential commodity, and the Defence of India Act, 1971 and the Defence of India Rules, 1971 are considered to apply to other commodities excluding essential commodities there would be no conflict whatsoever between the Essential Commodities Act and the Defence of India Act and between the notifications issued under Fertilizer (Control) order, 1957 and the Defence of India Rules, 1971. If that is not done there will be real conflict between the two and, therefore, the two Acts must be so construed as to avoid conflict in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect from that date that there may be some stock of fertilizer on 31.5.1974 purchased by dealers at lower prices which may be carried over for sale subsequently. What has been done by the State Government under the impugned notification is utterly lacking in power and cannot be allowed to stand merely because it relates only to a comparatively small quantity of fertilizer carried over from the stock of 31.5.1974 and was intended to benefit and protect agricultural consumers and prevent dealers from making undue profits. For the reasons stated above the appeals are allowed and the impugned State Government's notification dated 14.6.1974 is quashed. There will be an order directing the District Agricultural officers and other District Authorities in the State of Uttar Pradesh not to ask the dealers to refund the excess in respect of the sales completed prior to the date of the impugned notification. The District Magistrates concerned shall return the monies deposited with them by the dealers pursuant to this Court's orders dated 2.9.1974 and 30.10.1974. The respondents shall pay the appellants' costs. There will be one set of advocate's fees in the batch of appeals in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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