IMPORTANT POINT
U.P. Coal Control Order which requires brick kiln owners to obtain licence for using slack coal is valid but the provisions controlling disposal of bricks are not valid and struck down.

Headnote:U.P. Coal Control Order, 1977 -Application of provisions to manufacturers of brick with aid of slack coal - Provision requiring brick kiln owners using coal to obtain licences valid-Purpose is to prevent misuse of coal-Bricks can be freely disposed of-No condition could be specified or directions issued that relate to sale and distribution of bricks-Provisions which control and regulate disposal of bricks struck down.
       Held : Coal being an essential commodity, the State Government is certainly entitled to regulate its use. To that extent it is entitled to regulate its use in brick kilns and require those who run brick kilns using coal to obtain licences under the said Order. The earlier order of this Court in the case of Janta In. Udyog does not, therefore, lay down the law correctly. That power, however, does not extend to the control in any manner of the bricks so produced. All that is requisite for the purposes of control of coal is that there should be no misuse of coal in the production of bricks. The bricks themselves can be freely disposed of. (Para 7)
       With this in mind, it is necessary to identify and strike down those provisions of the said Order which control not the coal but the bricks. In regard to para 5(b) and in para 8(i)(B), it is necessary to make it clear that no condition may be specified or direction issued that relates to the sale and distribution of bricks. Sub-para (iv) of para 8 and the Note thereto, which we have extracted above, deals, except in clause (a) thereof, entirely with bricks and to that extent, paragraph 8 must be quashed. Paragraph 12, insofar as it applies to the export of bricks, must also be quashed. Insofar as the licence in Form D is concerned, the condition that requires a licensee to comply with general or special directions issued in regard to the disposal or sale of any stock of bricks is quashed. (Para 8)

ORDER

The appeal has been referred to a Bench of three Judges because the two learned Judges who earlier heard it were of the opinion that the decision of this Court in State of U.P. & Ors. v. Janta In. Udyog & Ors.1 required reconsideration.

2. Under appeal is the order of a Division of the High Court at Allahabad which, following an earlier judgment of the High Court, quashed the provisions of the U.P. Coal Control Order, 1977 insofar as it applied to persons manufacturing bricks with the aid of slack coal and to brick kilns run by them for such manufacture of bricks. The order was passed on writ petitions filed by the manufacturers of bricks who used slack coal in their brick kilns.

3. The U.P. Coal Control Order ("the said Order") was issued in exercise of powers conferred by Section 3 of the Essential Commodities Act, 1955. It defined `bricks to mean bricks or tiles produced with the aid .

of slack coal but did not include firebricks or refractory bricks and tiles. A `brick kiln meant any kiln in which bricks were manufactured with the aid of coal and the premises appurtenant thereto. Paragraph 4 of the said Order dealt with licensing thereunder; it said that no person could import coal or carry on business as a coal agent or coal depot-holder or run a brick kiln with coal except under and in accordance with the terms and conditions of a licence issued under the said Order. Paragraph 5 dealt with the issue of licences and sub-paragraph (b) thereof said that every licence granted or renewed under the said Order, inter alia, in Form D for running a brick kiln with slack coal would be subject to the conditions specified therein and such other conditions as the State Coal Controller or District Magistrate might prescribe from time to time. Paragraph 8 of the said Order dealt with directions regarding import, purchase, sale, storage and distribution, it required the licensee of a brick kiln under the said Order to comply with any direction that might be issued to him from time to time by the State Coal Controller or the District Magistrate, inter alia, in respect of the sale and distribution of bricks. Sub-para (iv) of paragraph 8 and the Note thereunder read thus:

"(iv) A licensee in Form `D or a person running a brick kiln with coal -

(a) shall not utilise or cause to be utilised coal allotted to him or in stock with him for a purpose other than burning bricks and shall not divert or transfer any such coal to any other person or any other brick kiln, even though owned by him, except under a written authority from the District Magistrate.

(b) shall sell the whole or a specified part of his stock of bricks produced with the aid of slack coal to a person as may be specified in a permit issued in that behalf of the District Magistrate and addressed to him;

(c) shall manufacture with the aid of slack coal bricks of such sizes as may be fixed by the District Magistrate and shall further sell them at such prices as may be fixed by the District Magistrate for different sizes and classes of bricks.

Note.-For the purpose of this sub-clause, the District Magistrate may, subject to any direction of the State Government by general or special order fix-

(a) the sizes of which bricks with the aid of slack coal are to be manufactured; and

(b) the maximum price at which different classes of such bricks may be sold to the public in general and in bulk to construction agencies in the public section particular by any person, such price, being based on the estimated cost of, manufacture of such bricks plus reasonable margin of profit thereon :

Provided that different prices may be fixed in respect of different classes and sizes of such bricks for different localities in the district having regard to different circumstances pertaining thereto."

Para 12 of the said Order dealt with the export of coal and bricks and stated that no person could export, cause

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1999 Supreme(SC) 1450

IMPORTANT POINTU.P. Coal Control Order which requires brick kiln owners to obtain licence for using slack coal is valid but the provisions controlling disposal of bricks are not valid and struck down.

Cases Referred (1)

IMPORTANT POINT
U.P. Coal Control Order which requires brick kiln owners to obtain licence for using slack coal is valid but the provisions controlling disposal of bricks are not valid and struck down.