A person cannot be convicted of an offence under Section 7 of the Essential Commodities Act, 1955, for contravening a licensing order if they had a bona fide belief that they were acting legally.

This reference has been made by the learned Additional District Magistrate (J.) Etawah. The facts of the case are that Sri Maharaj Singh, Marketing Inspector at Auraiya, district Etawah, was informed in the afternoon of 19th December 1966 that the two applicants had sold 25 kntls. and 45 kgs. of pea on 17th December 1966 to M/s. Shyam Lal, Sri Govind, which was a food grain licensee at Auraiya. The Marketing Inspector was further informed that the applicants did not possess a license for dealing in food grains. The applicants are the partners of the firm known as Laxmi Narain Ram Narain. Against both the applicants charges were framed by the learned Magistrate 1st Class, Etawah, on 22nd April 1967 on the statement of Maharaj Singh, Marketing Inspector, Auraiya. The learned Magistrate framed the charges against the applicants for having contravened Cl.3 of the U.P. Food Grains Dealers Licensing Order 1964 and thus were punishable under Section 7 of the Essential Commodities Act. These charges, as already stated above, were framed on 22nd April 1967. Against the order framing the charge against the applicants the applicants preferred a revision which was heard by the learned Additional District Magistrate (Judicial), Etawah who has made the present reference.

2. Sri Maharaj Singh, the Marketing Inspector Auraiya, was examined and during his examination he admitted that Laxmi Narain, one of the partners of the firm Laxmi Narain Ram Narain, held a food grains license for another shop in Mahabirganj. The Marketing Inspector further stated that it was possible that the applicants may have filed an application for the grant of a license in the name of the firm Laxmi Narain Ram Narain on 20th October 1966. He further stated that that application had not been rejected till the date of his statement. He also admitted that a licence for selling the food grains was issued to the firm Laxmi Narain Ram Narain for the year 1967.

3. The question, therefore, is whether, under these circumstances, the applicants being partners of the firm Laxmi Narain Ram Narain, could deal in food grains without holding a license for that firm as such. Clause 5 of U.P. Food Grains Dealers Licensing Order, 1964 deals with period of licence and fees chargeable. The second proviso to sub-clause (1) of Cl.5 of the Order reads as follows :

"Provided further that where an application for a new licence made in accordance with sub-clause (1) of Cl.4 has not been disposed of within 30 days from the date of receipt of the application by the licensing authority the applicant shall be issued a provisional licence valid for three months and the application shall be disposed of during the validity of the provisional licence."

4. Since the Marketing Inspector stated that the applicants possibly filed an application for the grant of a licence on 20th October 1966 a provisional licence ought to have been issued in favour of the firm much before 19th December 1966. The applicants being the partners of the firm could not possibly be said to have a guilty intention in selling any licenced food grains on 17th December 1966 because the Marketing Inspector admitted that the firm Laxmi Narain, Ram Narain deals in food grains and that on behalf of the firm ready information of its stocks was given to him. The Marketing Inspector further admitted that in the months of November and December 1966 the papers of the firm, Laxmi Narain, Ram Narain, came to his office on various dates and he and other officials of his office used to sign those papers. Thus the evidence of the Marketing Inspector himself shows that an application for the grant of a new licence for selling food grains had been made by the applicants and the conduct of the Marketing Inspector and the other officials of his office reasonably led the applicants to believe that they could deal in food grains. As a matter of fact, as the clause of the U.P. Food Grains Licensing Order, 1964 quoted above shows, it was the duty o