Licensing conditions must align with legislative intent; mandatory requirements outside jurisdiction are deemed illegal.

1. This is a petition under Art. 226 of the Constitution challenging the legality of the conditions imposed in a licence dated September 4, 1961, and an allotment order also dated September 4, 1961, as also directions in a letter dated October 20, 1961, copies of which licence, order and letter are annexed to the petition. The relevant facts are as follows :

2. The petitioners are a partnership firm carrying on business, inter alia, of export of ferrous scrap from India to foreign countries. The Petitioners had in fact in connection with export of ferrous scrap prior to the date of the above stated licence obtained several licences for export of ferrous scrap. By an application for licence dated August 29, 1961, (copy whereof is annexed as Ex. 9 to the affidavit of M. M. Solanki in reply dated January 15, 1962), the Petitioners applied for exporting 300 tons of cast iron borings and turnings (scrap). As a result of this application, the 1st Respondent issued to the Petitioners the licence in question dated September 4, 1961, to export Ferrous scrap : 300 tons of cast iron borings and turnings (scrap). In the licence conditions are mentioned subject to which the licence was issued. The main condition which is challenged as illegal in this petition is Condition No. 1 and runs as follows :
"To entitle the exporter to ship material under this licence he shall have to supply 10 tons of heavy melting scrap for export of every 100 tons of turnings and borings (both steel and cast iron) to the furnace owner nominated by Iron and Steel Controller or by such authority as he may appoint in this behalf."
Conditions 2, 3, 4 and 5 run as follows :
"2.  xxxx xxxx xxxx
Heavy melting scrap to be supplied by the exporter to the furnace owner as per condition (1) above shall be subject to inspection by the Iron and Steel Controller or his representative (s). If as a result of inspection at the exporter's godown or yard, it is considered by the Iron and Steel Controller or his representative that the exporter does not possess heavy melting scrap in the required quantity or this material is not heavy melting scrap and if a certificate from the furnace owner confirming receipt of heavy melting scrap is not produced as evidence, export of turnings and borings (both steel and cast iron) under this licence shall not be permitted.
(3) If it is found as a result of this inspection that the scrap in question can be utilised in India the exporter will have to remove the materials from the Docks at his own expense and sell it to consumers in India nominated by the Iron and Steel Controller at the statutory price. Exports will be permitted only if the material cannot be used in India and if the Iron and Steel Controller is satisfied that the scrap sought to be exported falls within the categories licensed.
(4) The Iron and Steel Controller's decisions in this respect shall be final. Government will not be responsible for any claim for loss due to demurrage, frustration of contract or any other reasons whatsoever.
(5) The licence is liable to cancellation without notice at any time and without any reason being assigned therefor."

3. By the allotment order dated September 4, 1961, the 1st Respondent referred to the above export licence and the shipment to be made by the Petitioners of the 300 tons of goods mentioned in the licence and instructed the Petitioners to deliver in that connection the materials as mentioned in that order to the furnace owners mentioned therein. The allottees (the furnace owners), the quantities of the goods deliverable to them and the price receivable by the Petitioners are mentioned in the order as follows :

It is