Point of Law : Under Section 7 of Act, power to impose penalty is upon Court and not on District Collector.

JUDGMENT :

Since Common issues arise for consideration in these writ petitions, they were heard together and are disposed of by this common judgment. The exhibits referred to hereinbelow shall be as obtaining in W.P.(C) No.12246 of 2012.

2. The 1st petitioner in W.P.(C) No.12246 of 2012 is a proprietary concern of petitioner No.2, a distributor of Liquefied Petroleum Gas (for short, 'LPG'). Based on a complaint received by the Director of Civil Supplies from a consumer organization that liquefied petroleum gas supplied under Government subsidy is being diverted for commercial purposes, a special squad under the Taluk Supply Officer, Muvattupuzha conducted surprise inspection at the premises of Sri Rajan Kadathukadavil, the petitioner in W.P.(C) No.13104 of 2012 at Vyppin (who will hereinafter be referred to as 'Sri. Rajan', unless otherwise specifically mentioned). In the inspection, 11 numbers of LPG cylinders supplied for commercial purposes were seized, as Sri. Rajan had failed to produce any bill, invoice, or other documents supporting such storage of LPG cylinders with him. Based on the report of the special squad that the cylinders were supplied to Sri. Rajan by the 1st petitioner, the District Collector, issued Ext.P1 notice to the 1st petitioner alleging that it had violated the provisions of Liquefied Petroleum Gas (Regulation of Supply and Distribution) Order, 2000 (for short, 'the Order, 2000') and Section 3 of the Essential Commodities Act, 1955 (for short, 'the Act'). Similar notice was issued to Sri. Rajan also.

3. The petitioners and Sri. Rajan submitted reply to the notices stating that the cylinders alleged to have been seized for which the violation has been alleged were commercial cylinders not regulated under the Act and there is no violation of Order, 2000 or the Act.

4. The District Collector issued Ext.P4 order stating that the petitioners have committed an offence under Section 3 of the Act by conniving with Sri. Rajan for conducting illegal business of selling LPG, warranting penal action under Section 7 of the Act, and accorded sanction for prosecuting the 2nd petitioner, the licensee and further directed the Indian Oil Corporation Ltd; to initiate action under the Marketing Discipline Guidelines, 1998 for LPG Distributorships. As against, Sri. Rajan, the District Collector found that he is guilty of conducting unauthorized business of selling LPG which is prohibited under Clause 6 of Order 2000, and thereby he has committed offence under Section 3 of the Act warranting penal action under Section 7 of the Act and accorded sanction for his prosecution. The order is extracted hereunder :

“ORDER

Sri. Kadathukadavil Rajan, from whose premises the LPG Cylinders have been seized, is guilty of conducting unauthorized business of selling LPGas, which is prohibited under Clause 6, of the L.P.G. (Regulation of Supply & Distribution) Order 2000, and thereby he has committed offence under Section 3, of the Essential Commodities Act 1955, warranting penal action required under section 7, of the Essential commodities Act 1955. Therefore sanction is hereby accorded for prosecution of Sri. Rajan Kadathukadavil, Kampanipeedika, Ochanthuruth, Vypin.

2. The licensee of M/s, Sithara Indane Gas Agency has committed offence under section 3 of the Essential Commodities Act, 1955 by conniving with Sri. Rajan Kadathukadavil for conducting the above illegal business. Penal action under section 7 of the Essential Commodities Act, 1955 is warranted against the licensee. Therefore sanction is also accorded for prosecution of the licensee of M/s Sithara Indane LPG Distributors, Thoppumpady.

The Indian Oil Corporation Ltd; is directed to initiate appropriate action against this dealer for imposing suitable fine provided under the marketing discipline guidelines 1998 for LPG Distributorships”.

(emphasis supplied)

5. A Counter Affidavit is filed on behalf of the District Collector stating that LPG is an essential commodity and is regulated und