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IN THE HIGH COURT OF KERALA AT ERNAKULAM
ASHOK BHUSHAN, A.M.SHAFFIQUE, JJ.
STATE OF KERALA & Ors. – Appellants
Vs.
ALL KERALA BHARAT GAS DISTRIBUTORS ASSOCIATION & Ors. – Respondents
W.A. No.581 of 2009, W.A. Nos.638, 680, 689, 700, 701, 712, 792, 805, 808, 816, 817, 818, 819, 820, 821, 827, 828, 829, 830, 842, 843, 844, 845, 846, 848, 852, 854, 858, 861, 862, 863, 864, 873, 874, 875, 878, 886, 889, 893, 894, 895, 900, 902, 906, 911, 912, 913, 914, 927, 928, 929, 930, 938, 943, 1024, 1025, 1040, 1041, 1045, 1046, 1057, 1078, 1081, 1088, 1135 and 1146 of 2008
Decided on : 24-2-2016
The Kerala Petroleum Products Dealers Licensing Order, 1981 (1981 Order) issued by the State Government under the Essential Commodities Act, 1955 (1955 Act) was challenged as being overridden by subsequent Orders issued by the Central Government under Section 3 of the 1955 Act. The Court held that the 1981 Order was indeed overridden and unenforceable due to the Central Government's exercise of its power under Section 3 and the overriding effect of the subsequent Orders.
Fact of the Case:
The State of Kerala issued the 1981 Order in exercise of powers delegated to it by the Central Government under Section 5 of the 1955 Act. The Central Government had previously issued various Orders under Section 3 regulating petroleum products, including the Liquefied Petroleum Gas (Regulation of Supply and Distribution) Order, 2000, the Motor Spirit and High Speed Diesel (Regulation of Supply, Distribution and Prevention of Malpractices) Order, 2005, and the Lubricating Oils Grease (Processing, Supply, Regulation and Distribution) Order, 1987. The State Government notified the enforcement of the 1981 Order in 2008, leading to challenges by petitioners who argued that the Order was unenforceable as it conflicted with the Central Government's Orders.
Finding of the Court:
The Court found that the Central Government had exercised its power under Section 3 of the 1955 Act to issue Orders regulating petroleum products, including the Orders cited by the petitioners. The Court held that the State Government's exercise of delegated power under Section 5 could not override the Central Government's exercise of power under Section 3. The Court further noted that the subsequent Orders issued by the Central Government contained overriding provisions, indicating an intention to supersede any conflicting State Orders. The Court concluded that the 1981 Order was overridden and unenforceable due to the Central Government's exercise of its power under Section 3 and the overriding effect of the subsequent Orders.
Issues: 1. Whether the State Government could issue the 1981 Order after the Central Government had already issued Orders under Section 3 covering the same field. 2. Whether the 1981 Order was overridden and unenforceable in light of the subsequent Orders issued by the Central Government under Section 3.
Ratio Decidendi: 1. The Central Government's exercise of power under Section 3 of the 1955 Act to issue Orders regulating petroleum products could not be overridden by the State Government's exercise of delegated power under Section 5. 2. The subsequent Orders issued by the Central Government under Section 3 contained overriding provisions, indicating an intention to supersede any conflicting State Orders.
Final Decision: The Court dismissed all the Writ Appeals challenging the Single Judge's decision that the 1981 Order was unenforceable and void.
Ashok Bhushan, C.J.
These Writ Appeals have been filed against the common judgment dated 05.12.2008 in a bunch of Writ Petitions filed by the respondents to these Writ Appeals. Writ Petition No.14350 of 2008 was treated as the leading Writ Petition by the learned Single Judge. Writ Appeal No.581 of 2009 arising out of the aforesaid Writ Petition is being treated as the leading Writ Appeal and reference of facts giving rise to W.A.No.581 of 2009 shall be sufficient for deciding all these Writ Appeals.
2. Parties shall be referred to as described in W.P(C) No.14350 of 2008.
3. Brief facts of W.P(C) No.14350 of 2008 are: First petitioner is the registered association of distributors of Liquified Petroleum Gas (for short, "LPG") duly appointed by the Bharat Petroleum Corporation Limited, a Government of India Oil Company. The second petitioner, a member of the first petitioner is one of the distributors of LPG. The Parliament enacted the Essential Commodities Act, 1955 (hereinafter referred to as "the 1955 Act") in the interest of general public for the control of the production, supply and distribution of, and trade and commerce in certain commodities. Section 3(1) of the 1955 Act provides that if the Central Government is of the opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may by order, provide for regulating or prohibiting the production, supply and distribution thereof. Section 3(2), without prejudice to the generality of the powers under Section 3(1) enumerates various heads for exercise of such power. Section 5 provides for 'delegation of power' which provided that the Central Government, may by notified order, direct that the power to make orders or issue notifications under Section 3 shall in relation to such matters and subject to such conditions, if any, be also exercisable by the State Government and other authorities. The Central Government by order dated 13.11.1962 which was published in the Gazette of India dated 14.11.1962 made delegation of certain powers enumerated in Section 3(2) to different State Governments including the State of Kerala. At the time when the above delegation order dated 13.11.1962 was issued, the Central Government had not issued any order under Section 3 with regard to the petroleum products. The Central Government thereafter issued various Orders under Section 3, viz., (i) Petroleum products collection of information Order, 1966; (ii) Petroleum Products (Maintenance of Production) Order, 1970; (iii) Petroleum Products (Regulation of Supply and Distribution) Order, 1979; (iv) Petroleum Products (Supply and Distribution) Order, 1972 and Petroleum Storage Order, 1971.
4. However, in the year 1981, the State of Kerala in exercise of the powers delegated to it by order dated 13.11.1962 issued an order under Section 3(2), viz., Kerala Petroleum Products Dealers Licensing Order, 1981. The said Order was published in the Kerala Gazette Extraordinary on 22.05.1981. Although the above Order was published on 22.05.1981, the State Government did not issue any Notification appointing any date for enforcement. In the meantime, the Central Government continued to issue various Orders under Section 3 for petroleum products. Petroleum products included motor spirit, high speed diesel oil, petroleum based lubricants and liquified petroleum gas. The Central Government continued to issue Orders under Section 3 and it issued Orders separately regarding liquified petroleum gas, motor spirit, high speed diesel oil, and petroleum based lubricants oils. With regard to liquified petroleum gas, the Central Government issued the following Orders, viz., (1) The Liquified Petroleum Gas (Restriction on Use) Order, 1974; (ii) The Liquified Petroleum Gas (Regulation of Supply and Distribution) Order, 1993 and (iii), The Liquified Petroleum Gas (Regulation of Supply an
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