The judgment establishes that while reasonable classification is allowed, there must be a rational relation between the basis of classification and the object to be achieved, and all relevant factors must be considered in price fixation.

JUDGMENT :

M.M. Das, J. - This writ petition has been filed by Sri Pawan Kumar Agrawal, proprietor of M/s. Annapurna Rice Mill and the Jeypore Chamber of Commerce and Industry, Jeypore with a prayer for issuance of a direction to the opposite-parties to pay Rs. 1052.37 paise per quintal for common raw rice and Rs. 1036.91 paise per quintal for common par boiled rice per quintal, which is supplied by the Petitioner to the opposite parties under the levy rice scheme including cost of new 50 kg gunny bags for the Central Pool during the Kharif marketing season 2004-05 instead of Rs. 965.70 paise and Rs. 952.10 paise per quintal respectively for the aforesaid type of rice, as has been directed by the opposite party No. 3 vide Annexure-1 dated 20.10.2004 and further to quash the said, direction under Annexure-1 to the writ petition. The Petitioner No. 2 is stated to be a representative body of rice millers in the district of Koraput, which agitates the grievance of the rice millers of Koraput District before the State Government and District -Administration and also takes necessary steps to,protect the interest of the consumers in the District

2. It is the case of the Petitioners that the Union Government: enacted Food Corporation Act, 1964 to provide remunerative price to the farmers for their product in order to protect such farmers from being exploited and harassed by unscrupulous businessmen. As per the said Act, the Food Corporation of India (hereinafter referred to as 'the FCI') has been established. Minimum support price of paddy is being fixed by the Central Government as per the provisions of Section 13 of the aforesaid Act, every year with arrangement that in the event the price of paddy goes down in the open market, the F.C.I takes up the responsibility of procuring paddy from the farmers, paying, them the minimum support price. As neither the F.C.I. nor the State Government Agencies are in a position to procure the entire paddy produced by the farmers for want of infrastructure, the millers are being required by the State Government to procure paddy on their behalf by paying the minimum support price for the paddy to the farmers. The Petitioners have alleged that under such circumstances, the millers are being compelled to participate in the procurement process to help the administration but are getting less price than the Government agencies for the rice produced after milling, the difference being Rs. 84.71 paise and Rs. 86.67 paise for common boiled rice and raw rice respectively, which is approximately 8% of the total price. Each year a Food and Procurement Policy is issued by the Government of India as well as the State Government fixing the minimum support price and also fixing the target of procurement.

3. The Food and Procurement Policy for the year 2004-05 was issued by the Government of India commencing from 01.10.2004 and ending with 30.09.2005. The said policy, inter alia, provided that the FCI would procure rice through the miller agents in all the districts as per district-wise target indicated in the policy and the millers will procure paddy from the farmers on payment of the minimum support price fixed by the Government in the policy. After procuring such paddy the millers were required to deliver 75% of the procured stock in shape of rice to the.F.C.I. The Petitioner No. 1 being 'a miller has been appointed as a miller agent fori the district of Koraput and supplying 75% of the procured stock in shape of rice to the F.C.I. during the Kharif year 2004-05.

4. It is the grievance of the Petitioners that during the Kharif year 2002-03, the minimum support price of paddy was Rs. 530/- per quintal and the price of levy rice was fixed at Rs. 988.30 paise for common raw rice and Rs. 974.70 paise for boiled rice per quintal including gunny bags and transportation charges. Similarly for the Kharif year 2003-04, the minimum support price of paddy was fixed at Rs. 550/- per quintal and the price of common raw rice and