1996 Supreme(SC) 862

1996(5) Supreme 164
SUPREME COURT OF INDIA
K. Ramaswamy, S. Saghir Ahmad and G.B. Pattanaik, JJ.
Dalmia Cement (Bharat) Ltd. & Anr. etc. -Appellants
versus
Union of India & Ors. etc. -Respondents
Transfer Case No.3 of 1989
and
Transfer Case (C) No.177 of 1988
With
T.C.(C) Nos.178-189, CMP No.10091/89, 14930/89, IA Nos.5 & 6/90 in TC Nos. 1-7/89, CMP Nos.25857/88, 17552/89, TC Nos.25-26/89, CMP Nos.5913-14/89, 8736/89, TC No.27/89, WP No.1235/89, 1277/90, 1278/90, IA Nos. 1 & 5/89 in WP No. 922/90, 1164/90, IA No. 6/92, WP No.921/92, IA Nos.5-6/93 in T.P. No.
 286/94, 294/94, W.P. Nos. 778/95 and 826/95
All Decided on 25-4-1996

IMPORTANT POINT
Provisions of Sections 3, 4 and 5 of the Jute Packaging Material (Compulsory use in Packing Commodities) Act, 1987, are not violative of Article 14 or 19(1)(g) of the Constitution and the Act and orders impose reasonable restriction saved by Article 19(6) of the Constitution.

Headnote:Constitution of India-Arts. 14 and 19(1) (g)-Jute Packaging Material (Compulsory use in Packing Commodities) Act, 1987-Sections 3, 4 and 5-Validity of-Challenged -Prayer for repeal of Act or gradually phasing out compulsory packing of commodities with gunny bags-Compulsion to pack cement, sugar and other essential commodities with jute bags-Whether directions issued by the Central Government for compulsory packing is unconstitutional?-(No)-Whether prohibition of 100 use of gunny bags by sugar industry and 70 by the cement is reasonable?-(Yes)-Relative economic viability of respective industries not to be examined by Court.

       Held : The object of the benign measure primarily is to protect the interests of growers of agricultural produce, who cultivate raw jute. Incidentally, the manufacturers and the workmen get benefit therefrom. Agricultural economy accords to the grower socio-ecomomic justice to provide dignity of person, equality of opportunity to have his produce used in industry etc. Agriculture is treated as industry on par with any other industry. The State should provide, by legislative or executive measure, all facilities and opportunities to get them due price for their products and have them marketed for use in industry. The orders passed by the Central Government are made subject to Parliamentary control and subject to modification by both Houses. (Para 26)

       Further held : A balanced view has to be struck by the Central Government in directing use of jute packaging material at the percentage of the jute bags to be used for compulsory packing of the commodities which is subject to Parliamentary control and approval. Parliament is the spokesmen of the people where the need is felt most accute. When the orders passed under Section 3 are subject to modification by the Parliament, Parliament preserved to itself a great salutary control over executive exercise of power under Section 3(1). It is such a valuable public protection and safeguard kept with the Parliament itself. Parliament would be the best Judge to discuss in each House as to what extent competing interests of the agricultural industry and the industry involved in commercial products need to be protected and would guide the Central Government appropriately by resolution or otherwise. (Para 27)

       It is a question of fact, to be considered in each case, as to what percentage is required to be used; it is primarily for the Central Government to decide as executive policy. The Central Government is guided by the material placed before it and the advice tendered to it by the Standing Advisory Committee constituted under Section 4 of the Act. It depends upon the availability of the jute and its products in the market, the quantum of raw jute produced by the agriculturists, its demand in the market and its capability for diversification into other industry for ancillary use of the jute material and hosts of other factors enter into the decision making process. The exercise is required to be undertaking from time to time. The Act, the Rules and the material placed before it by the Committee and the advice tendered by the expert body form the basis. The decision taken and direcitons issued cannot be said to smack of arbitrariness. Guidelines are available under the Act and the Rules made in this behalf. They are Parliamentary control. Paramount public interest is to provide economic security and equality and justice to the producers of the raw jute and the workers engaged in manufacturing and other jute packaging material. (Para 28)

       Consequently held : That raw agriculture produce is an input of finished product for commercial purposes and its regulation, by the Acts or Rules or Orders, cannot be assailed as ultra vires the legislature on the basis of the population of the agriculturists when it affects consumer public or manufacturers of finished products whose business avocation incidentally gets affected. On that account, the Act cannot be declared void or ultra vires the power of the Parliament to enact the law. (Para 31)

       It is seen that the State has not abondoned and cannot abandon the mixed economy and power of regulation as mandated by constitutional policy. The Parliament and Executive are bound by the Constitution. The Act was made in implementation of socio-economic equality and policies. Even a private industry by operation of Directives contained in Part IV, is bound to adopt them, implement them and the Government policies to establish an egalitarian social order. The committee in its free market frenzy became oblivion of the policy resolution of Eighth Five Year Plan, the Trinity, Preamble, Fundamental Rights and Directives. The executive policy of the State should be cognizant to these mandates which should always bind the Govenment and all agencies including private agencies. As seen, the Advisory Committee constituted under Section 4 has recommended 100 use of packing the sugar with gunny bags. On consideration of the report, the Government had acted upon the same. The economic policy to render socio-economic justice to the growers of the raw jute and the workman is based on the above constitutional policy. Lest the report of the committee on the basis of a free market economy would be in negation of the Preamble, the Directive Principles and the Fundamental Right to economic justice to the agriculturists. So the contention is clearly unsustainable. The Standing Advisory Committee, therefore, had properly advised and the Government obviously has taken decision to continue the policy of compulsory packing of commodities or class of commodities with jute bags, regulated under Section 3 of the Act. The Parliament did not negate the same. (Para 33)

       Finally held : Considered from this perspective, we hold that the provisions of Sections 3, 4 and 5 are not violative of Article 14 or 19(1)(g) of the Constitution. The Act and orders impose reasonable restriction saved by Article 19(6) of the Constitution. (Para 38)

       (ii) Judicial Review-Economic legislation-Validity of-Challenged -Presumption in favour of constitutionality-Powers of Court.

       Held : that the Court is not well equipped to adjudge crudities and inequities emerging from economic legislation. The legislature is empowered to experiment on economic legislation in its attempt to remove inequalities in income or status or to provide facilities and opportunities to improve economic status or provide social and economic justice to the society or a particular descernable segments of society or to remove the defect where the legislature felt most acute. There is always presumption in favour of constitutionality. The Legislature appreciates the needs of the people and directs the laws to the problems made manifest by experience and discrimination is based on adequate grounds. The Court does not supplant the feel and experiment of the expert by its own views. Court in deference to legislative judgment, imposes self-restraint to adjudge on crudities and experiment but concern on core constitutionality. (Para 30)

       (iii) Constitutional Validity-A class legislation based on geographical features is constitutionally valid. (Para 31)