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2025 Supreme(Online)(J&K) 1048
HIGH COURT OF JAMMU AND KASHMIR
Wasim Sadiq Nargal, J
Kehar Singh – Appellant
Versus
Union Territory of J&K – Respondent
WP(C) No. 2790/2025
For the Appellants/Petitioners: Vikram Sharma, Sachin Dev Singh, Sanpreet Singh
For the Respondents: Monika Kohli, Adarsh Bhagat, Dewakar Sharma
Statutes regulating specific industrial sectors, including licensing mandates, apply to both manufacturers and dealers. Fiscal tax registration does not exempt entities from sector-specific regulatory requirements, and judicial intervention via writ jurisdiction is improper where established statutory appellate remedies have not been exhausted.
Headnote:(A) Industry Regulation - Licensing Requirements - Scope of regulation - Whether licensing mandates under the statute extend to trading entities or are limited to manufacturing units only - Determination of regulatory intent and statutory definitions.
(B) Constitutional Law - Article 19(1)(g) and (6) - Freedom of trade and commerce - Whether regulatory licensing constitutes an unreasonable restriction - Balancing fundamental rights with legitimate state objectives and public interest - Doctrine of reasonable restrictions.
(C) Revenue and Fiscal Laws - Tax Registration - Whether registration under tax enactments exempts a business entity from sector-specific regulatory licensing - Distinct spheres of fiscal operation and regulatory administration.
(D) Writ Jurisdiction - Exhaustion of Remedies - Principle that direct invocation of writ jurisdiction is premature when statutory appellate mechanisms remain unexhausted. (Paras 24-86)
Facts of the case:
Petitioners, engaged as traders of building materials, challenged the enforcement actions taken by local administrative authorities involving the seizure of transport vehicles carrying goods sourced from outside the territory. The petitioners contended that licensing obligations under the enacted statute applied exclusively to manufacturing entities rather than traders, and further argued that their registration under national tax legislation superseded any requirement for sector-specific licensing.
Findings of Court:
The court determined that the statutory definitions and the overall legislative framework were designed to govern both manufacturing and trading operations. The court held that tax-related registration signifies fiscal compliance and does not operate as a substitute for regulatory requirements tailored to public safety, environmental protection, or market stability. The administrative enforcement actions were found to be within the jurisdictional mandate.
Issues: The main issues addressed were whether licensing requirements apply to traders; whether administrative authorities are empowered to enforce such requirements; whether fiscal registration provides an exemption from sector-specific regulation; whether the writ petition is maintainable; and whether the regulatory requirements infringe upon the constitutional right to carry on trade.
Ratio Decidendi: The court interpreted the statutory language to encompass both manufacturers and dealers to ensure comprehensive oversight, as any exclusion would frustrate the objective of preventing market manipulation and illegal trading. It affirmed that tax compliance operates in a distinct field from sector-specific regulatory licensing. Furthermore, the court held that challenges to administrative orders must be directed through the established appellate hierarchy created by the governing statute before seeking judicial review.
Result: Writ petition dismissed.
| Table of Content |
|---|
| 1. arguments concerning scope of regulation regarding dealers vs. manufacturers. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23) |
| 2. licensing requirements under rule 3 apply to both manufacturers and dealers. (Para 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37 , 38 , 39 , 40) |
| 3. legality of deputy commissioners exercising powers as licensing authorities. (Para 41 , 42 , 43 , 44 , 45 , 46 , 47) |
| 4. gst registration does not provide exemption from sector-specific regulatory licensing. (Para 48 , 49 , 50 , 51 , 52 , 53 , 54 , 55 , 56 , 57 , 58) |
| 5. writ petitions are premature when statutory appellate remedies exist. (Para 59 , 60 , 61 , 62 , 63 , 64 , 65) |
| 6. regulatory licensing is a reasonable restriction under article 19(6). (Para 66 , 67 , 68 , 69 , 70 , 71 , 72 , 73 , 74) |
| 7. final confirmation of regulatory framework validity and dismissal of petition. (Para 75 , 76 , 77 , 78 , 79 , 80 , 81 , 82 , 83 , 84 , 85 , 86) |
Coram: HON’BLE MR. JUSTICE WASIM SADIQ NARGAL, JUDGE
JUDGMENT
BRIEF FACTS
01. The present writ petition has been filed by the petitioners under Article 226 of the Constitution of India challenging the orders issued by the District Magistrates of Kathua and Samba directing seizure of vehicles transporting bricks imported from outside the Union Territory of Jammu and Kashmir and imposing penalties under the Jammu and Kashmir Brick Kiln (Regulation) Act, 2010 and the the Jammu and Kashmir Brick Kiln (Regulation) Rules, 2017.
02. The petitioners, who are dealers and not manufacturers of bricks contended that the said Act and Rules apply only to brick kiln owners engaged in manufacturing within the Union Territory, and not to dealers dealing in finished bricks imported from other States. They allege that the impugned orders are arbitrary, without jurisdiction, and violative of their fundamental right to trade and commerce under Article 19(1)(g) of the Constitution.
03. The respondents, however, justify the action on the ground that the regulatory framework under the Act covers the entire brick trade, including sale, storage, and transportation, and that the impugned orders were passed to curb illegal and unlicensed trade activities in accordance with law.
SUBMISSIONS ON BEHALF OF PETITIONERS
04. Mr. Vikram Sharma, learned senior counsel appearing for the petitioners, submitted that the Jammu and Kashmir Brick Kiln (Regulation) Act, 2010 has been enacted only to regulate and control the establishment of brick kilns in the Union Territory of Jammu and Kashmir and not to regulate the business of trading or transportation of bricks. He contended that the licensing requirement envisaged under Sections 4 to 7 of the Act read with Rule 3 of the Jammu and Kashmir Brick Kiln (Regulation) Rules, 2017 applies only to manufacturers of bricks, not dealers who merely purchase and sell bricks.
05. Learned counsel submitted that the impugned orders passed by the Deputy Commissioners of Kathua and Samba, which directed seizure of vehicles transporting bricks from outside the Union Territory, confiscation of consignments, and initiation of prosecution under Section 21 of the Act, if any person or entity was found contravening the impugned orders, have been issued without authority of law and by misinterpreting Rule 3 . According to him, Rule 3 only prohibits “manufacture, sale or storage of bricks except by holding a valid licence” in the context of brick kiln operations, and cannot be extended to dealers who are not engaged in manufacture.
06. Learned senior counsel argued that the Deputy Commissioners have enlarged the scope of the Act and Rules by applying licensing requirements to dealers, which amounts to legislative overreach and is contrary to the object of the statute. He emphasized that there is no separate license prescribed either under the Act or Rules for trading, import, or storage of bricks by dealers. The only license contemplated under Section 6 is for the
