HAMDARD DWAKHANA (WAKF'), DELID & Anr. v. UNION OF INDIA & Ors.

Marketing Adviser to the Government of India, New Delhi, invited a representative of the appellants for discussions, and as a result of the said discussion, Mr. Sood, the Marketing Development Officer, Delhi, inspected the factory of the appellants and watched the process of manufacture of Sharbat Rooh Afza on April 29, 1957. Thereafter, on May 10, 1957, the appellants received a H communication from Mr. Sood ordering the appellants to stop further manufacture and sale of Sharbat Rooh Afza forthwith on HAMDARD DWAKHANA v. UNION (Gajendragadkar, C.J.) 195· A B the ground that it did not contain the minimum percentage of fruit juice prescribed by the relevant clause of the Fruit Order. Thi& communication mentioned the fact that the appellants had been specifically asked to prepare fruit syrups strictly in accordance with the specifications prescribed, but in utter disregard of the said instructions, the appellants had wilfully continued to contravene the provisions of the Fruit Order. That is why by virtue of the powers conferred on him by clause 13 ( f) of the Fruit Order, the present order was served on the appellants· It is this order which was challenged by the appellants by their writ petition filed before the Punjab High Court on the 18th May, 1957 (No. 258-D of c 1957). D By their writ petition, the appellants prayed that the impugned order as well as the several orders passed preceding it, should be quashed and a writ of mandamus should be issued against the respondents restraining them from seeking to enforce the material provisions of the Fruit Order in respect of the appellants' product 'Sharbat Rooh Afza'. The appellants urged that the said Sharbat is not a foodstuff, but a medicinal product and as such, it' produc tion cannot be regulated under the provisions of s. 3 of the Act. According to them, the said Sharbat was not an essential com modity, nor was it a 'fruit product' as defined by clause 2 ( d) of the fruit Order. They also urged that the impugned order was invalid, because appellants under Art. 19(1)(f)&(g) of the Constitution; Sharbat in question was in fact a medicinal product and as such, the impugned order was inconsistent with clause 16 ( i) ( c) of the Fruit Order. It is on these grounds that the appellants sought relief by way of an appmpriate writ or order quashing the impug- F ned order issued against them on May 10, 1957. To this petition, the appellants impleaded the Union of India as respondent No. 1. it contravened the fundamental rights of E G This petition was resisted by the respondents on several grounds. It was alleged that the Sharbat in question fell within the scope of the Act and the Fruit Order. The respondents refer red to the fact that the Hamdard Dawakhana had duly applied and was granted a licence in 1955 as a manufacturer engaged in the business of manufacturing fruit products for sale. The Dawa· khana is holding this licence since 1955. The bottles in which the Sharbat in question is sold by the appellants do not bear labels It appears the Dawakhana obtained a licence for the year 1952 under Fruit Products Order 1948 for the manufacture of the Sharbat in question. On analysis, it was found that the said Sharbat did not H containing the words "for medicinal use only". 196 SUPREME COURT REPORTS [1965) 2 S.C.R. contain fruit juice, though it was sold as fruit juice. The label A -On the bottle of the Sharbat depicts pictures of fruits. Under the said Order of 1948 the synthetic syrups containing no fruit juice were required to be clearly marked as 'synthetic' and to abstain In 1954 when it was from using labels with pictures of fruits. found that the Dawakhana did not get the licence renewed, the appellan.ts were asked either to get their licence renewed or to get B exemption by complying with the necessary conditions. When the appellants did not e-0mply with these directions, some of the bottles of the Sharbat were detained in the market. That led to a writ petition filed by the appellants in 1954 (No. 11-D/1954) in the Punjab High Court. When the petition, however, came for final hearing, it was not pressed, and so, was dismissed on June 5, 1954. The Dawakhana then filed a suit for injunction, but the said suit became infructuous with the expiry of the Fruit Products Order. 1948 on January 25, 1955. The present Fruit Order came into force on May 3, 1955; and the Dawakhana filed another suit for injunction, but pending the suit, the appellants applied for and D obtained a licence under the Fruit Order and in consequence, the suit was withdrawn on October 18, 1955. Even after obtaining the licence, the requirements of the relevant provisions of the Fruit Order as to the minimum percentage of fruit juice were not complied with by the appellants; and that led to the impugned order. That is the background of the present writ petition. c E In the present writ petition, the respondents urged that Sharbat in question is not sold for medicinal purposes; it is manu factured by the appellants as a fruit product and sold as such. No exemption was claimed by the appellants under clause 16 of the Fruit Order. The Sharbat in Question is foodstuff within the mean- F ing of s. 2 of the Act and it falls within the purview of the Fruit Order. The impugned order is not unconstitutional, because the restriction imposed by it is consistent with the relevartLprovisiom of the Act and the Fruit Order, and the said provisions are per fectly valid, because they impose a reasonable restriction in interest of general public. the G This writ petition came on for final disposal before the Punjab liigh Court on January 13, 1964. The High Court has rejected t11e pleas raised by the appellants and dismissed their writ petition. The High· Court has held that there was no substance in the appel In support of lants' grievance that the Fruit Order was invalid. this conclusion, the High Court has relied upon a decision of this H HAMDARD DWAKHANA v. UNION (Ga;endragadkar, C.J.) 197 A Court in M/s. Amrit Banaspati Co., Ltd. v. The State of Uttar Pradesh('). The High Court negatived the appellants' argument that the Sharbat in question was either prepared or sold as a medi- • In this connection the High Court has commented cinal product. on the fact that the label borne by the bottles containing the Shar bat did not show that it was for medicinal use only as required by B cl. 16(i)(c) of the Fruit Order· According to the High Court, clause 11 of the Fruit Order covered the case of the Sharbat pre pared by the appellants, and so, the impugned order was justified. The High Court also found that there was no substance in the grievance made by the appellants that as a result of this impugned C order, their registered trade-mark label had been affected. The High Court then examined the question as to whether the provisions of the Fruit Order could be said to be invalid, and it held that the said provisions were perfectly valid inasmuch as the restrictions impo~ed by them were reasonable and in the interests of It is on these grounds that the High Court the general public. D dismissed the appellants' petition. Thereafter, the appellants applied for and obtained a certificate from the High Court to come to this ~ourt in appeal. This certi ficate was granted on July 22, 196'1. Affer the appeal was admit ted in due course, the appellants moved this Court on October 26, E 1964 for stay; in fact, during all the seven years that the writ peti tion was pending before the High Court, the appellants had obtain ed stay and they wanted the stay to continue pending the final disposal of this appeal. When we found that the writ petition had taken an unusually long time in the Punjab High Court, we directed that the stay should continue in favour of the appellants, F but that the appeal should be heard on November 9, 1964. That is how the hearing of this appeal has been specially expedited. Before we deal with the points which have been raised before us by Mr. Pathak, we would refer very briefly to the scheme and the relevant provisions of the Act and the Fruit Order. The Act G was passed in 1955 for the purpose of controlling the production, supply and distribution of, and trade and commerce in, certain commodities in the interests of the general public. The com modities which were intended to be brought within the purview of the Act were essential commodities as defined by s. 2 (a) of the them are included foodstuffs, including edible Act. Amongst H oilseeds and oils covered by s. 2(a)(v), and any other class of commodity which the Central Government may, by notified order, {!) Criminal Appeal No. 141of1959 decided on 30-11-1960. 198 SUPREME COURT REPORTS [1965] 2 S.C.R. declare to be an ·essential commodity for the purposes of this A Act, being a commodity with respect to which Parliament has power to make laws by virtue of entry 33 in List III of the Seventh Schedule to the Constitution; this is included in the definition by s. 2 (a)( xi). Section 3 (1) provides that if the Central Govern ment is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or B for securing their equitable distribution and availability at prices, it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof and trade and com merce therein. Sub-section (2) by clauses (a) to (h) provides for different categories of orders which may be passed by the Cen- C tral Government without prejudice to the generality of the powers conferred on it by sub-section ( 1 )- It would thus be clear that the Act confers power on the Central Government to regulate the production, supply and distribution of essential commodities. This power is conferred in a very general and wide sense by s. 3 (1). There can be little doubt that the power to regulate the production D of an essential commodity will include the power to regulate the production of essential commodities which may operate either qualitatively or quantitatively. In other words, essential commodities, the Central Government is given the power to direct how certain essential commodities should be produced and in what quantity. This power, of course, can be exercised E only if the condition precedent prescribed by s. 3 ( 1) is satisfied, and that is thai the Central Government should be of opinion that it is necessary or expedient to regulate the production of any essential commodity for one of the purposes mentioned by it. This position cannot be, and is not, disputed before us. M/s. Amrit Banaspati Co. Ltd.(') this Court whilst dealing with F the provisions of the Vegetable Oil Products Control Order, 1947, issued under s. 3 ( 1) of the Act, has definitely ruled that a quali tative regulation in respect of the production of an essential com modity is permissible under s. 3 ( 1) of the Act. in regard In fact That takes us to the Fruit Products Order which was issued G by the Central Government on May 3, 1955, in exercise of the powers conferred on it by s. 3 of the Act. Clause 2 of the Fruit Order defines 'fruit product'. Cl. 2( d)(i) takes in synthetic beverages, syrups and sharbats; cl. 2(d)(v) takes in squashes, crushes, cordials, barley water, barreled juice and ready-to-serve beverages or any other beverages containing fruit juices or fruit H pulp. Clause 2 ( d) (xiv) takes in any other unspecified items relating to fruits or vegetables· Clause 2 (j) defines "sharbat" as • A B c D E F G H HAMDARD DWAKHANA v. UNION (Gajendragadkar, C.J.) 199 meaning any non-alcoholic sweetened beverage or syrup contain ing non-fruit juice or flavoured with non-fruit flavours, such rose, khus, kewra, etc; and cl. 2 (k) defines "synthetic beverage" as meaning any non-alcoholic beverage or syrups, other than aerated waters, containing no fruit juice but having an artificial flavour or colour resembling as fruit. Clause 7 of the Fruit Order prescribes that every manufacturer shall manufacture fruit products in conformity with the sanitary requirements and appropriate standard of quality and composition specified in the Second Schedule to this Order; it adds that every other fruit and vegetable product not so specified shall be manufactured in accor dance with the standard of quality and composition laid down in this behalf by the Licensing Officer. That takes us to clause 11; it is necessary to read this clause fully:- ( 1 ) Any beverage which does not contain at least 25 per centum of fruit juice in its composition shall not be described as a fruit syrup, fruit juice, squash or cordial or crush and shall be described as a synthetic syrup. (2) Every synthelic syrup shall be clearly and cons1Jicu ously marked on the label as a 'SYNTHETIC' product, and no container containing such product shall have a label, whether attached thereto or printed on the wrapper of such container or, otherwise, which may lead the con sumer into believing that it is a fruit product, Neither the word 'FRUIT' shall be used in describing such a product, nor shall it be sold under the cover of a label, which carries the picture of any fruit. Aerated water containing no fruit juice or pulp shall not have a label which leads the consumer into believing that it is a fruit product. Part II of the Second Schedule to the Fruit Order prescribes the specifica rions for fruit juice and other beverage<;. In regard to fruit syrnp, it provides, inter alia, that the minimum percentage of fruit juice in the final product must be 25 % . The respondents' contention is that since the Sharbat in question produced by the appellants does not comply with this specification, it contravenes the mandatory provision of cl. 11 (I ) . Part IV of the Second Schedule prescribes the specifications for synthetic syrups sharbats. Under this Part, there is no requirement as to any minimum of fruit juice in the said syrups and sharbats. 200 SUPREME COURT REPORTS 1965] 2 S.C.R. Clause 16 of the Fruit Order provides for cases to which !hi! A Order does not apply, Clause 16(i)(c) provides that nothing in this Order shall be deemed to apply to any syrups which are sold in bottles bearing a label containing the words "For medicinal use only" which does not exhibit any picture of fruits. It is common ground that the appellants do not sell the Sharbat in question in bottles bearing a label containing the words "For medicinal use B only" and s9, cl. 16 ( i) ( c) does not apply and the appellants can claim no exemption on that account. Mr. Pathak no doubt attempted to argue that the Sharbat in question is not an essential commodity and as such, it does not fall within the purview of the Act or within the purview of the Fruit C Order. It appears that this plea was not urged by the appellants before the Punjab High Court. It was argued by them before the High Court that the Sharbat in question was a medicinal product; and that point had been considered and rejected by the High Court; and so, it has assumed that the Sharbat in question is an essential commodity within the meaning of s. 2 of the Act; question cannot now be allowed to be argued for the first time before this Court. that D Mr. Pathak wanted to suggest that the Sharbat in question is not a fruit product and as such, is outside the purview of the Fruit Order. We are not impressed by this argument. We ~ave already E referred to cl. 2 ( d) ( v) of the Fruit Order which refers to several beverages, and the residuary part of this clause takes in any other beverages containing fruit juices or fruit pulp. The suggestion that this clause should be read ejusdem generis with the previous categories of beverages cannot obviously be accepted because an examination of the said beverages will disclose the fact that there F is no genus by reference to which the rule of ejusdem generis can be properly invoked. Besides, the context of the clause clearly suggests that it is intended to take in all beverages other than those earlier specified, provided they contain fruit juices or fruit pulp. Therefore, we feel no difficulty in holding that the Sharbat in question falls within the purview of cl. 2(d) (v) of the Fruit Order G and as such, its production can be controlled by its relevant pro visions Then it is urged by Mr. Pathak that the Fruit Order itself is invalid, because it does not purport to say that before it was issued, the Central Government had formed the opinion that it was H necessary or expedient to issue the Order for maintaining or in in question. Mr. Pathak creasing supplies of the commodity HAMDARD DWAKHANA v. UNION (Gajendragadkar, C.J.) 201 A contends, and rig;btly, that the condition prescribed by the first part of s. 3 (1) of the Act is a condition precedent and it is only when and after the said condition is satisfied that the power to issue a regulatory order can be exercised by the Central Govern· ment. This contt:.ntion again cannot be allowed to be raised for the first time in appeal, because if it had been raised before the B High Court, the respondents would have had a chance to meet it. It is true, as Mr. Pathak contends, that in the absence of any specific averment made by the Fruit Order that the Central Gov· emment had formed the necessary opinion, no presumption can be drawn that such opinion had been formed at the relevant time; but it would have been open to the respondents to prove that such an opinion bad been formed at the relevant time; and it cannot be suggested that the failure to mention that fact expressly in the Fruit Order itself would preclude the respondents from p10ving the said fact independently. That is why we think Mr. Pathak cannot be permitted to urge this contention at this stage. c D i: Mr. Pathak, bas, however, strenuously argued before us that the Fruit Order is invalid, because its relevant provisions indicate issued that it is an Order which could have been appropriately under the Prevention of Food Adulteration Act, 1954 (No. 37 of 1954). In support of this argument, Mr. Pathak bas relied on the fact that Act 37 of l •954 is relateable to the legislative power con· ferred by Entry 18 in List III of the Seventh Schedule to the Constitution which r<efers to adulteration of foodstuffs and other goods; and so, the material provisions of the Fruit Order which really prevent the adulteration of fruit products could be legiti mately enacted under this Act. On the other hand, the Essential ., Commodities Act, 1955 is relateable to Entry 33 in List ill and the Fruit Order issued under it would, therefore, be inappropriate, having regard to the object which this Order is intended to achieve. He argues that the two powers are distinct and separate, and the Fruit Order with which we are concerned, cannot be said properly It is true that the Prevention to have been issued under the Act. the problem is not easy of preventing adult1eration of to acceP.t Mr. Pathak's assumption that the regulatory Order of the kinl with which we are concerned which imposes regulations of a qualitative cha.racter in th~ production o~ essential good~, could have been issued under thlS Act. But qmte apart from this H consideration if s .. 3 ( 1 ) of the Act authorises the Central Gov· emment to regulate th1: qualitative and quantitative productio~ of essential commodities, it is idle to contend that the regulations G of Food Adulteration Act does deal with food; but L3Sup./65-- 14 202 SUPl.l!MI OOUllT REPORTS (1965] 2 S.C.R. clearly the Fruit Order imposed by the Fruit Order in ~pect of fruit products are ou!iide A the purview of s. 3 ( 1). The pith and substance of the relevant regulate provisions prod1~cts covered by the qualitative production of it. This object is illustrated by the specification with which we are concerned. Part II of the Second Schedule to the Fruit Order which has imposed the obligation on the manufacturers of fruit syrups to include at least 25 % of fruit juice in the final product of the fruit syrujJ produced by them, shows tlhat by virtue of its powers under s. 3.( 1) of the Act, the Central Government thought that a particular qma!ity of fruit syrup it necessary to require should be put on the market as fruit syrup and no other. This C object plainly falls within the purview of s. 3 ( 1), and so, the contention that the Fruit Order is invalid inasmuch as it purports lO tackle the probkm of adulteration of fruit produc!, cannot be ac.cepted. B Then Mr. Pathak suggested that there was some inconsistency D between the definition of 'synthetic beverage' prescribed by cl. 2(k) and the provisions of cl. 11 (2) of the Fruit Order. We have already read cl. 11. The effect of cl. 11 (1} is that if any beverage does not contain at least 25 per cent of fruit juice, it shall not be described, inter a/ia, as 'fruit syrup', but shall be described as a 'synthetic syrup', and sub-cl. ( 2) of cl. 11 therefore E provides that if any syrup which has to be de,scribed as a 'synthetic syrup' by virtue of the· provisions of sub-c;J. ( 1) is put on the market, it would be necessary to describe it as a 'Synthetic' product clearly and conspicuously. It is with the object of bringing it to the notice of the customers at large that the synthetic product does not contain the minimum fruit juice prescribed by the Fruit Order F that sub-cl. (2) imposes an obligation th at whoever puts synthetic product in the market shall mark it with a label "Synthe- tic" and no attempt would be made to de:icribe the product a~ though it was a fruit product. That is why a specific provision is made by sub-cl. (2) that neither the word "Fruit" shall be used in describing such a product, nor will it beai: a label which carries G 1he picture of any fruit. From this proviBion aerated waters are exempted, because it was thought that no customer would ever mistake aerated water for fruit juice. Now, if we bear in mind this scheme of clause 11. it is difficult to :see where the inconsis tency lies between cl. 11 and the definition of a 'synthetic bever age' as prescribed by cl. 2(k). The definition of synthetic bever- H age indicates that it is a beverage which contains no fruit juice, and clause 11 which contains a positive provision that beverages HAMDARD J:•WAKHANA v. UNION (Gajendragadkar, C.J.) 203 A containing less than 25 per cent fruit juice should be shown as a 'synthetic' prodmct. The definition of 'synthetic beverage' cannot be said to conflict with the requirement that the products falling under cl. 11 (2) should be sold as 'synthetic' products. Besides, clause 11 contains a positive provision and the validity of the man datory requirements of cl. 11 cannot be said to be impaired by B any alleged incomistency between the said provision and the definition of 'synthetic beverage' prescribed by cl. 2(k) of Fruit Order. E C The last co.ntention which Mr. Pathak urged before us is that the impugned •order is invalid, because it affects the appellants' trade-mark right. It is not easy to appreciate this argument. We have already held that the Act and the Fruit Order issued by the Central Govemment by virtue of its powers conferred by s. 3 ( 1) If that be so, the impugned order which is of the Act are valid. fully justified by the provisions of the Act and the Fruit Order D cannot be chalUenged as being invalid. The conclusion that the Act and the Firuit Order issued under it are constitutionally valid proceeds on the basis that the restrictions imposed by them are reasonable and in the interests of general public. What the im pugned order purports to do is to require the appellants to comply with the reasomable restrictions imposed by the Fruit Order. The fact that incidentally compliance with Fruit Order may tend affect their tr21de-mark right cannot, in our opinion, render impugned ord,er invalid. In this connection, it is necessary bear in mind tthat appellant No. 1 would not be justified in con tending that the registered trade-mark which is usually intended to distinguish one manufactured article from another can be used F by it even tho•ugh it is likely to mislead the customers, or its use would mean a breach of some other law. Besides, it is significant that the impugned order does not really compel the appellants to If the appeilants desire that the Sharbat change their trade-mark. in question should be put on the market without complying with the requirememts of clause 11 ( 1), all that they to do is to comply In the process of complying with cl. 11 (2), if their trade-mark right is likely to be affected, that would not render the impugned order invalid, because restriction which is sought to be enforced against them is found to be reasonable and in the interests of the general public. Besides, we would like to add that if the appellants wanted to urge this H point seriously, they should have placed before the Court rqore material in respect of their alleged trade-mark right. The appel lants had alleged in their writ petition that they are putting the G with cl. 11 (2) of the Fruit Order. • 204 SUPREME COURT REPORTS [1965] 2 S.C.R. Sharbat on the market as a medicinal product. may claim exemption by complying with cl. 16(i) (c) of the Fruit Order. We are, therefore satisf:ed that the Punjab High Court was right in holding that no case had been made out by the appel lants for quashing the impugned order. In that case, they A :a Before we part with this appeal, we would like to refer to one unfortunate aspect of the present proceedings. W "' have already indicated that the present writ petition was filed by the appellants in the Punjab High Court on May 18, 1957, and it was finally It is very much to be regretted decided on January 13, 1964. that the final disposal of this writ petition should have taken such an unusually long period. 1'he appellants have been agitating C this matter since 1957 and as a result of the long duration of the present writ petition in the High Court, they have had the benefit of the stay order all this time. though ultimately it was found that It is hardly necessary to there was no substance in the petition. add that writ petitions in which orders of stay and injunction are passed, should be decided as expeditiously as possible. That is D why when it came to the notice of this Court that this writ pe:hion has taken an unusually long period in the High Court, we directed that it should be set down for hearing within a fortnight after it was brought to us on a notice of motion for stay. The result is, the appeal fails and is dismissed with costs. E A ppea/ dismissed.