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2001 Supreme(Guj) 538

Gujarat High Court
Judgename :D.M.Dharmadhikari, K.R.VYAS
ATUL TRADING CO - Appellant
Versus
STATE - Respondent
L.P.A. 538 of 2001
Decided On : 08/01/2001

Advocates Appeared: BIPIN I.MEHTA, C.L.SONI, J.S.Yadav, KAVITA YADAV, MANISHA LAV KUMAR SHAH, R.C.Jani, S.B.VAKIL

Headnote:Constitution of India, 1950 - Arts. 19(1)(g), 19(6), 162, 166 & Entry 53 of Union List I of Sch. VIIth - Essential Commodities Act, 1955 (Central Act 10 of 1955) - Secs. 2(1)(viii), 2(c), 2(cc), 3 & 5 - Gujarat Essential Articles (Licensing, Control and Stock Declaration) Order, 1981 - Clauses 2, 4, 5, 7, 8, 12, 24 & 25 - Letters Patent Appeal - Against order of Single Judge - Fundamental right to trade - Wholesale dealers in essential commodity - Kerosene - Aggrieved by policy decision contained in circulars of Gujarat State Govt. dated 30.7.1988, 4.10.1990, 3.4.1995, 6.1.1997, 29.8.1997, 22.1.1999, 5.2.2001 and 19.6.2001 - Impugned circulars abolishing a class of whole sale dealers appointed directly by licencing authority - After expiry of their licences, licences to be granted and continued only to the duly appointed agents of oil companies, which are producers or manufacturers of kerosene - Challenged - Alleging violation of Art. 19(1)(g) - Held, petitioners entitled to claim fundamental right to carry on trade in kerosene as wholesalers or retailers - Reasonable restriction can only be imposed by law and not by circulars and executive instructions - Impugned order and circulars containing policy decision of State Govt. of Gujarat quashed and set aside.

       The petitioners can claim a fundamental right to carry on trade in kerosene in accordance with law as wholesalers or retailers. A restriction imposed on them to carry on trade as wholesalers only after obtaining agency from the oil Company is a restriction on their right and even though such a restriction may be said to be reasonable, it can be imposed only by law and not by merely Circulars or executive instruction which, as Court has held above, are not in accordance with either the Licensing Order or the Act. The impugned Circulars containing executive instructions and directions by the State to various Authorities including the Licensing Authority, therefore, are not protected by Art. 19(6) of the Constitution of India and, therefore, they have to be struck down as contravening petitioners right under Art. 19(1)(g).

       [Para 29]

       In the result, Court allowed all these LPAS and set aside the impugned common order of the learned Single Judge. Court quash, by a writ of certiorari, all the impugned circulars dated 30.7.1988, 4.10.1990, 3.4.1995, 6.1.1997, 29.8.1997, 22.1.1999, 5.2.2001 and 19.6.2001 which contain the policy decision of the State Government of Gujarat not to renew licences of the wholesale dealers in kerosene who are not agents of the oil companies.

       [Para 30]

DM DHARMADHIKARI, J.

( 1 ) THIS group of Letters Patent Appeals has been preferred against the common order dated 15. 9. 2000, 19. 1. 2001 and 20. 1. 2001 passed by the learned Single Judge rejecting special civil applications filed by the wholesale dealers in essential commodity- kerosene. Notice was issued on the appeals and the learned counsel for the appellants and respondent State and its authorities were heard at length on the merits of the case. With their consent, the appeals are being finally decided by this common order.

( 2 ) ALL the appellants-petitioners who are wholesale dealers in essential commodity- kerosene are aggrieved by the impugned policy decision contained in the circulars of the State Government of Gujarat dated 30. 7. 1988, 4. 10. 1990, 3. 4. 1995, 6. 1. 1997, 29. 8. 1997, 22. 1. 1999, 5. 2. 2001 and 19. 6. 2001.

( 3 ) THE appellants are holding wholesale dealers licences for essential commodity- kerosene in accordance with the provisions of the Gujarat Essential Articles (Licensing, Control and Stock Declaration) Order,1981 which is issued in exercise of powers of the State of Gujarat delegated to it by the Central Government in accordance with section 5 read with section 3 of the Essential Commodities Act, 1955 (hereinafter, for convenience, referred to as `licensing Order and `the Act respectively ). The appellants who are wholesale dealers in kerosene are aggrieved by the policy decision of the State of Gujarat contained in its impugned circulars whereby it has abolished completely a class of wholesale dealers appointed directly by the Licensing Authority under the Licensing Order. Under the policy decision contained in the circulars, on expiry of existing licences of wholesale dealers directly appointed by the Licensing Authority, the wholesale dealers licences in kerosene shall now be granted and continued only in favour of duly appointed agents of oil companies which are the producers or manufacturers of kerosene.

( 4 ) THE main grounds of challenge to the policy of the State Government in wiping out the appellants as a class of wholesale dealers directly appointed by the Licensing Authority and who are not duly appointed agents of the oil companies are , inter alia, that it deprives the appellants of their fundamental right to carry on trade guaranteed under Article 19 (1) (g) of the Constitution and abolition of class of wholesale dealers cannot be done by administrative instructions or directions, in contravention of the provisions of the Act and Licensing Order. Other grounds of challenge are based on the provisions of the Article 19 (6) of the Constitution. It is urged on behalf of the appellants that Licensing Order is a piece of delegated legislation under the Parent Act and without following the procedure provided in the Parent Act of making another statutory order to be notified in the official gazette, merely by impugned circulars or executive directions or instructions, the statutory provisions of the Licensing order cannot validly be changed. In this respect, it is submitted that the impugned circulars containing policy decision are in the nature of dictates to the Licensing Authority and interferes with the statutory function of the authorities under the Licensing Order. Reliance is placed on the following decisions: (1) dahyabhai Chaturbhai vs. State, 11 GLR 386; (2) somaji vs. Registrar,high court, 20 (20) GLR 646; (3) bhil Ambaji Bhanaji vs. State of Gujarat, 1996 (16) 2 GLR 272; (4) state of A. P. vs. Potta Sanyasi, AIR 1975 SC 2030; (5) union of India vs. Daljeet Singh,1999 (2) SCC 672; (6) krishna Mohan Shukla vs. Union of India, 2000 (10) SCC 507; (7) c. I. T vs. Sirpur Paper Mill,1999 (3) SCC 596 (8) union of India vs. Charanjit S. Gill, 2000 (5) SCC 742; (9) bachhittar Singh vs. State of Punjab, AIR 1963 SC 395.

( 5 ) ). ON behalf of the State Government, policy decision contained in the impugned circulars is sought to be supported on the ground that in the earlier public d
































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