Judgment

SARKARIA. J.:- The common question that has been seriously pressed into argument in this batch of writ petitions and criminal appeal mentioned in the title, relates to the constitutional validity of certain Rules framed by the State of Bihar under the Bihar Kendu Leaves (Control of Trade) Act, 1973 (hereinafter referred to as the Act) particularly clause 13, clause 4 (bb) of the Tender Notice and of the Statutory Agreement notified by the Bihar Government in the Bihar Government Gazette, and the notices of demand issued under the impugned provisions demanding "royalty" from the petitioners in respect of the undelivered quantity of Kendu leaves.

2. All these writ petitions will be disposed of by this common judgment. The basic question being common, it will suffice to state the facts giving rise to Writ Petitions 2222 to 2252 of 1977, filed by the New Bihar Biri Leaves Co.

3. The petitioners in all these writ petitions are either firms or individuals carrying on trade in Kendu leaves in the State of Bihar. However, petitioner No. 31 is an association of traders in Kendu leaves, of which the other petitioners are members.

4. Kendu leaves are grown as forest produce in several States, including the States of Bihar, Orissa, Andhra Pradesh, Maharashtra. Gujarat, Madhya Pradesh and a part of Uttar Pradesh. Under the old system in Bihar, the right to pluck and extract Kendu leaves from a forest coupe carved out by the Forest Department, was auctioned by the State Government.

5. On March 10, 1972, while the State of Bihar was under the Presidents rule, the Governor of Bihar issued the Bihar Kendu Leaves (Control of Trade) Ordinance, 1972. The provisions of this Ordinance were continued under successive Ordinances and ultimately replaced by the aforesaid Act of 1973. This Ad created State monopoly in the matter of sale of Kendu leaves to the manufacturers of bidis. Its purpose is to regulate this trade in relation to the grower of Kendu plants and the collection and sale of the same through the agency of the State to the registered manufacturers of bidis. Under its scheme, a specified area of Kendu leaves is divided into units. The grower is defined as a grower who holds lands on which kendu plants grow or who is in possession of such lands under a lease or otherwise, and includes the State Government. Under Section 3, the State Government may, by notification in the Official Gazette, declare any area to be a specified area for the purposes of the Act and divide every such specified area into such number of units as it may deem fit. Unit means a sub-division of a specified area constituted under Section 3. Under Section 4, the State Government may, for the purpose of purchase and sale of Kendu leaves on its behalf, appoint agents in respect of different units and any such agent may be appointed in respect of more than any one unit but not more than three units. The terms, conditions and the procedure for appointment of agents have been prescribed by the Rules framed under the Act, which we shall presently notice, Section 5 places restriction on purchase or transport of Kendu leaves. Section 8 mandates the Forest Officer incharge of a Division to set up in each unit a number of depots. Section 9 is Important and its material part runs as under :

"(1) The State Government or its authorised officer. or agent shall purchase Kendu leaves offered for sale and deliver at the depot during the business hours at the rates fixed under Section 7 :

Provided that it shall be open to the State Government or its authorised officer or agent, for reasons to be communicated in writing, to refuse to purchase or accept delivery of any Kendu leaves which, in their opinion, are not fit for the purpose of manufacture of bidis."

It will be seen that the proviso to sub-section (1) contains a built-in warranty inasmuch as it says that the authorised agents will be bound to accept delivery of all those Kendu leaves which, in their opinion, are fit for the purpos