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2007 Supreme(Kar) 206

Karnataka High Court
Sri BALAJI INDUSTRIES, BANGALORE - Appellant
Versus
UNION OF INDIA, NEW DELID-1 - Respondent
Decided On : 03-23-07
Writ Petition No. 40634 of 2003 (GM-RES)

Advocates:
Sri S.M. Chandrashekar,Sri M. Devadass,Sri Aravind Kumar,Sri T.S. Mahabaleshwara

Headnote:Constitution of India - Articles 14 and 19 (1)(g) - Validity Statutory requirement - Certain articles specified - Use of standard mark of Bureau of Indian Standards - Made compulsory - Held, it would not offend any fundamental right - Not arbitrary.

       Electrical Wires, Cables, Appliances and Protection Devices and Accessories (Quality Control) Order, 2003 - Order 3 - Validity - Certain articles specified - Use of standard mark of Bureau of Indian Standards - Made compulsory - Held, it would not offend any fundamental right - Not arbitrary. [H.V.G. Ramesh, J.] : The apprehension of the petitioners is that they have already manufactured the electrical products and they are upto the specifications of the Bureau of Indian Standards. However, it is for the petitioners to get the products, which are already manufactured without the specifications of the Indian Bureau of Standards, tested and if it is the specifications of the Indian Bureau of Standards, although no such certification was obtained earlier, the concerned authority shall allow the petitioners to deal them in the market with such certification. If the good/products already produced/manufactured are not upto the specifications or the standard as per the Bureau of Indian Standard then the petitions can rectify the same and after certification they can deal them in the market. However, it appears, after filing of the petition these petitioners have obtained an interim order before this Court and by virtue of the same they might have disposed of all the products manufactured by them. At least hereinafter, they shall stick on to the specifications.

       Constitution of India - Articles 302 - Control over trade and commerce - Held, Union as well as State Legislatures have power to exercise legitimate regulatory control - Does not amount to restriction. [H.V.G. Ramesh, J.] : The legitimate regulation does not infringe the freedom as provided under Article 301 of the Constitution, where a restriction imposed by law imposes a direct burdon on the freedom of trade under Article 301, it may be constitutionally valid if it is required in the public interest. The nexus of law with public interest must be reasonable. Article 303 of the Constitution of India, prohibits giving any preference to one State over another or making or authorising the making of any discrimination between one State and another in the matter of trade and commerce. However, for a special purpose such a restriction would be imposed to avoid scarcity of goods. What is being prohibited is manufacturing/producing of the goods by the manufacturers without adhering to the standards specified by the Bureau of Indian Standards i.e., the goods manufactured or produced are to ne of specified quality and standard in the interest of the consumer and the general public and it is not that there is an entire prohibition on manufacturing of goods. Under the circumstances, the argument of the learned Counsel for the petitioners that the regulations imposed at Annexure A are violative of Articles 302 and 303 of the Constitution of India and that there is a total prohibition on manufacturing of the form of regulation and a reasonable restriction and not a total prohibition on the process of manufacturing itself. As such, the rules framed in exercise of powers under Section 14 of the Act in the form of delegated legislation cannot be termed as ultra vires of the stature or the Constitution.

       Constitution of India - Articles 14 and 19 (1)(g) - Validity Statutory requirement - Certain articles specified - Use of standard mark of Bureau of Indian Standards - Made compulsory - Held, it would not offend any fundamental right - Not arbitrary.

ORDER

In this petition, petitioners have filed a Joint petition since the common question of law and facts are involved and sought for to quash the Electrical Wires, Cables, Appliances and Protection Devices and Accessories (Quality Control) Order, 2003, issued vide Notification dated 17-2-2003 as per Annexure-A and also to declare that Order 3 of the Electrical Wires, Cables, Appliances and Protection Devices and Accessories (Quality Control) Order, 2003 as illegal and for such order reliefs.

2. According to the petitioners, they registered themselves as a small-scale industry and the authority has granted permission to establish small-scale industry and the department has given the permanent registration number. The Government has issued notification acting under Section 14 of the Bureau of Indian Standards Act, 1986 and by virtue of the said order, it has included electrical wires, cables, appliances protection devices and accessories and prescribed the standards wherein, it has made it obligatory for compulsory registration for the manufacture of the products and also to obtain a licences under the Act and that the process of manufacturing the product should be according to the Act and Order. According to petitioners, clause (3) of the Order at Annexure-A prohibits manufacture, storage and distribution of products and clause (2) provides for prohibition from using the products and that they must be destroyed within three months from the date of notification. Some of the petitioners are said to be engaged in manufacturing the electrical switch gears namely electric motor starters and some of them are dealers of switch gears; they are said to have established the industry with a small investment and running the same over decades; the switch gears manufactured by them are said to be of good quality and are second to none in the market; there are said to be no complaints whatsoever in the market as to the quality of switch gears manufactured by them and also that they have gained goodwill in the market; the petitioners as well as the labourers are depending on the earning from the units established by them; they said to have established the infrastructure for manufacture of switch gears by investing their lifetime savings and borrowings. The respondents for the first time have included the products and issued a notification as per Annexure-A prescribing the standard for manufacturing switch gears; the process of manufacturing of the petitioners' switch gear is completely different from the process prescribed in the order, rather the switch gears manufactured/produced by the petitioners are more worthy and there are no instances of danger to human life; by this impugned notification petitioners are prohibited to manufacture, sell and distribute the product and it is mandated for destroying the raw material and finished products acquired and possessed by them. It is their grievance that the prohibition imposed on them violates the fundamental right guaranteed under Article 19(1)(g) of the Constitution of India, in ordering to destroy the components, raw materials and accessories acquired and possessed by them for valuable consideration, without paying adequate compensation and as such Order 3 passed is arbitrary and that Annexure-A is a subordinate legislation made by the Central Government exercising the power under Section 14 of the Bureau of Indian Standards Act of 1986 and the prohibition contained in the impugned order at Annexure-A is illegal, arbitrary and without authority of law and violative of Article 14 of the Constitution and the same cannot be sustained.

3. Heard the learned Counsel appearing for the petitioners and the learned Counsel appearing for Central Government.

4. It is the submission of the learned Counsel for the petitioners that the order issued at Annexure-A by the Central Government is in violation of the provisions of Articles 19(1)(g), 302, 303 and 304 of the Constitution of India. It is further subm













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