2009 Supreme(Guj) 391

2009 (3) GCD 2261 (Guj) (DB)
Hon’ble Mr. Chief Justice K.S. Radhakrishnan &
Hon’ble Mr. Justice Akil Kureshi
All India Corporation Biotech Association of India & Ors.
Versus
State of Gujarat & Ors.
Special Civil Application No. 8528 of 20081—Decided on 09/07/2009

Point in Issue :
Whether Act of 2008 and notification issued thereunder to regulate the prices of cotton seeds lacks the constitutional validity?

Headnote:Head Note :

       Gujarat Cotton Seeds (Regulation of Supply, Distribution, Sale and Fixation of Sale Price) Act, 2008 — Section 12 — Notification fixing sale price of Cotton Hybrid Seeds — Seeds Act, 1966 — Sections 5 and 7 — Essential Commodities Act, 1955 — Sections 3 and 2-A — Seeds Control Order, 1983 — Rules for Manufacture, Use, Import, Export and Storage of Hazardous Micro Organisms/Genetically Engineered Organism or Cells 1989 — Environment Protection Act, 1986 — Constitutional Validity of the Act of 2008 and notification issued under Section 12 of the Act — Admittedly now there is no provision in the Essential Commodities Act or the Environment Protection Act to regulate and to control the sale price of such Cotton Seeds in the State — State Government was, therefore, competent to enact such Law which could regulate the prices of Cotton Seeds — The power of State Government can be traced to Entry No. 33 in the List III of VIIth Schedule of Constitution — Court found that price of Bt. Cotton Seed has been fixed by Gujarat Seed Corporation after consulting interest parties and on basis of available material State Government has issued the impugned notification — All the same if petitioners or the seed companies have any further grievance they can always place the same before the Government it can always change it’s policies on pricing — There appears, therefore, no reason to strike down the notification fixing price of Bt. Cotton Seeds — Court held that challenges addressed to the Constitution validity of Act as well as to the notification issued under the Act are not sustainable — Petition lacks merit.

       Held :

       The report and other attending circumstances would clearly indicate that Parliament has consciously omitted cotton seeds from the definition of ‘essential commodities’. In fact Clause (a) Section 2 was omitted in the Act No. 54 of 2006. Section 2-A clearly says that for the purpose of Essential Commodities Act, “essential commodity” is a commodity which is specified in the Schedule. Once a commodity is not included in the Schedule, it will not be an essential commodity within the meaning of Essential Commodities Act, and therefore the provisions of the Essential Commodities Act as well as the provisions of Seed Control Order, 1985, would not apply. Consequently, Central Government left with no power to control prices of cotton seeds which do not figure in the Schedule to the Act. Consequently, Order 2(1) of Seeds Control Order rendered inapplicable to cotton seeds. ‘Seeds’ means as defined in the Seeds Act, 1966. Seeds Act though defines cotton seeds under Section 2(11)(ii), the same would not apply in case of Seeds Control Order, 1983, since cotton seeds was taken out of purview of Essential Commodities Act. Consequently, there was no obligation on the part of the dealers to display stock price list of cotton seeds as per Order 8 of Seeds Control Order, 1983 and hence there was no machinery either under the Essential Commodities Act or under the Seeds Control Order, 1983, to control price of cotton seed. Consequently, field of legislation originally occupied by the Central legislation was left open and hence State Legislature got power to legislate on cotton seeds. [Para 25]

       Above facts would clearly indicate that cotton seeds are not covered by any Central legislation so as to regulate supply, distribution, sale and fixation of sale price of cotton seeds, especially when cotton seed is not an essential commodity within the meaning of Essential Commodities Act, 1955, amended by Act No. 54 of 2006, and the provisions of Seeds Control Order, 1983 issued under Section 3 of the Essential Commodities Act, 1955, are not applicable in so far as they relate to cotton seeds with effect from 12.02.2007, and there is no provision in the Essential Commodities Act or the Environment Protection Act to regulate supply, distribution and sale of transgenic and genetically modified cotton seeds and to control the sale price of such cotton seeds in the State. [Para 27]

       Court find price of Bt cotton seed has been fixed by the Gujarat Seeds Corporation after consulting farmers’ associations as well as seed companies represented by their associations and on the basis of available materials placed before the Corporation and the State Government. Senior Counsel for the petitioners submitted that the impugned Notification was issued hurriedly. Court has already indicated that after omission of cotton seed by Act No. 54 of 2006, for the last two years or so, there was no control over the price of Bt cotton seeds, therefore, price of Bt cotton seeds shot up, leaving farmers at the mercy of seed companies. Hence, there was extreme necessity of issuing a notification for controlling the price rise. The mere fact that Notification was immediately issued after issuance of Ordinance does not mean that it was issued without application of mind. On the other hand, Court may indicate that the interest of the farmers, seed companies and others were taken into consideration before the Notification was issued. All the same, if petitioners or the seed companies have any further grievance, they can always place the same before the Government and it can always change its policies on pricing. Court, therefore, find no reason to strike down the Notification dated 11.06.2008 fixing the price of Bt cotton seeds. [Para 31]

       The challenge against the constitutional validity of the Act cannot stand, so also the Notification issued thereunder. Writ petition lacks merit and the same is dismissed. In the facts and under the circumstances, there shall be no order as to costs. [Para 33]

       Law Laid Down :

       It is well settled that Court should be slow in interfering with pricing policy of the State.