Patna High Court
Case Details
IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.8174 of 2013 ====================================================== 1. M/S Ambica Sales Corporation, A Proprietary Concern, Having Its Place Of Business At C-149, 1st Floor, Mauryalok Complex, P.S.-Kotwali, Town And District- Patna Through Its Proprietor Birendra Singh, S/O Shri Raj Kishore Singh R/O Behind Mishra Lodge, Shivpuri, P.S.- Shastrinagar, Town And District- Patna .... .... Petitioner/s Versus 1. The State Of Bihar Through The Principle Secretary Department Of Agriculture, Government Of Bihar, Vikash Bhavan, Bailey Road, Patna 2. The Director Of Agriculture Department Of Agriculture, Government Of Bihar, Vikash Bhavan, Bailey Road, Patna 3. The Joint Director Of Agriculture, Patna Division Department Of Agriculture, Government Of Bihar, Mithapur Farm, Patna 4. The District Agriculture Officer, Patna .... .... Respondent/s ====================================================== Appearance : For the Petitioner/s : Mr. Gautam Kejriwal, Adv. For the Respondent/s : Mr. A.K.Sharma, SC-9. ====================================================== CORAM: HONOURABLE MR. JUSTICE JAYANANDAN SINGH CAV ORDER 5 31-10-2013 Before adverting to the issues and cases of the parties, chequered history of this case is required to be noticed. Petitioner is a proprietary concern and a wholesale dealer of fertilizer in the district of Patna. It got registered with the respondents and was issued certificate of registration by the Licensing Authority, i.e., District Agriculture Officer-cum-Notified Authority (Fertilizer), Patna with effect from 16.8.2007 for three years, i.e., till 15.8.2010 (Annexure-1) which was renewed with effect from 9.10.2010 for another three years (Annexure-1/A). Under the instructions of the Directorate, contained in memo no.195 dated Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 2 13.11.2008, a review meeting was held in the office of the Licensing Authority on 15.11.2008. In the meeting, as per the telephonic instructions of the Principal Secretary, three separate inspection teams were set up for inspection of functioning of the wholesale and retail fertilizer dealers of the district. Team-II led by one Sri Krishna Bihari, Deputy Director, Agriculture (Plant Protection), Patna Division was assigned to inspect the functioning of the petitioner and review of sale of fertilizers in the month of October, 2008 up to the last point. Accordingly, the team held inspection and submitted its report on 18.11.2008. In the report the team pointed out certain shortfalls and anomalies in the functioning of the petitioner and some retail dealers. The report was considered by the Director, Agriculture, who, vide his letter dated 13.1.2009 (Annexure-3), directed the Licensing Authority to cancel the letter of authorization of the petitioner and others with immediate effect, collect documentary evidences and institute an
Facts
FIR against them under Section 7 of the E.C. Act. Meanwhile, in view of the report, a show cause notice had been issued to the petitioner, vide letter dated 29.11.2008. Petitioner replied to the show cause notice, giving his explanation with supporting documents (Annexure-4). However, the Licensing Authority was not satisfied with the show cause and, in view of the orders of the Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 3 Director, letter of authorization of the petitioner was cancelled, which was communicated through letter dated 18.4.2009 (Annexure-5). Petitioner challenged the said order before this Court in CWJC No.5971 of 2009. The writ application was heard and was finally allowed by order dated 15.5.2009 (Annexure-6), whereby the order of the Licensing Authority dated 18.4.2009 was quashed, primarily on the ground that the Licensing Authority had not applied his independent mind and had acted on the directions of the Director, who had no authority in law to direct the Licensing Authority, a statutory authority, to exercise his jurisdiction in any particular manner. Accordingly, the respondent Director, Agriculture, revoking his orders contained in the said letter dated 13.1.2009, referred the report of the inspecting team to the Licensing Authority through his letter dated 22.7.2009 (Annexure-6/A) for appropriate action, on the irregularities pointed out in the report, under the provisions of the Fertilizer Control Order, 1985 and Essential Commodities Act, 1955. Accordingly, the Licensing Authority restored the certificate of registration of petitioner by letter dated 19.8.2009 and issued a notice on 24.8.2009 to show cause. Thereafter referring to the conditions in the certificate of registration of the petitioner, certain provisions of the Essential Commodities Act and of Fertilizer Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 4 Control Order, 1985, he again cancelled the licence of the petitioner, vide his letter dated 10.10.2009 (Annexure-7). This order of the Licensing Authority was also challenged by the petitioner before this Court in CWJC No.14783 of 2009, and its operation was stayed by this Court by order dated 23.12.2009 (Annexure-8). The said writ application was finally heard and allowed by order dated 11.11.2010 (Annexure-9) by which notice dated 24.8.2009, as well as the order of cancellation of certificate of registration dated 10.10.2009, were quashed and the matter was remitted back to the Licensing Authority to issue fresh show cause notice to the petitioner within a period of 15 days, to which petitioner was directed to file reply within next 15 days, and the Licensing Authority was directed to dispose of the matter within three months thereafter. The Licensing Authority thereafter issued a fresh show cause notice on 27.12.2011, in compliance to the orders of this Court, leveling certain charges against the petitioner, to which petitioner replied through its letter dated 27.1.2012 (Annexure-10 series). However, the Licensing Authority, through his letter dated 7.2.2012 (Annexure-11), once again cancelled the certificate of registration of the petitioner. Against this order, petitioner preferred appeal before the Joint Director, Agriculture, which was Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 5 heard on 27.2.2012 and 12.3.2012, and was rejected and the order of the Licensing Authority dated 7.2.2012 of the cancellation of certificate of registration was confirmed, communication of which was received by the petitioner through letter dated 20.3.2012 (Annexure-12). Petitioner thereafter once again moved this Court through CWJC No.8650 of 2012, which was heard and disposed of by this Court by order dated 21.6.2012 (Annexure-13), and the said communication dated 20.3.2012 (Annexure-12) was set aside, as being without reasons, and the matter was remitted back to the Joint Director, Agriculture, with a direction to him to rehear the matter. Accordingly petitioner filed a representation, with a certified copy of the order of this Court, before the Joint Director through letter dated 03.07.2012 (Annexure-14). The Joint Director once again rejected the appeal of the petitioner and affirmed the order of the Licensing Authority dated 7.2.2012 and communicated the same to the petitioner through letter dated 14.7.2012 (Annexure-15). Petitioner challenged this communication also in this Court through CWJC No.15546 of 2012. However, while the case was pending the Joint Director issued a notice of rehearing to the petitioner. Petitioner accordingly appeared before him, but finally under the letter Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 6 no.112 dated 29.1.2013 (Annexure-16) dealing with the charges against the petitioner the appeal of the petitioner was once again rejected and the order of the Licensing Authority dated 7.2.2012 was again confirmed. Accordingly, petitioner withdrew his writ application on 26.2.2013 (Annexure-17). This appellate order as contained in Annexure-16 and the order of Licensing Authority contained in letter dated 7.2.2012 (Annexure-11) are under challenge in this writ application. This chronology of events shows that dispute has been traveling as a shuttle cork between the respondents and this Court repeatedly and the present writ application is the 5th round in the matter. Hence, this Court was of the opinion that this is a fit case in which under the powers of judicial review, this Court should go deeper into the merits of the matter within the permissible limits of its jurisdiction than confining itself only to the decision making process. Now, after the earlier orders of this Court, what remains alive for consideration in this writ application are the inspection report, as contained in Annexure-2, the last show cause notice, as contained in Annexure-10 with its reply, and the impugned appellate order, as contained in Annexure-16. Since the last order of the respondent District Agriculture Officer, as Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 7 contained in Annexure-11, against which appeal was preferred, merges into the impugned appellate order, this Court does not consider it necessary to separately consider it. Now, the impugned appellate order shows that, out of the five charges, four have been found true against the petitioner. Out of the four, the first charge is that the petitioner had not maintained the stock register as per form ‘N’ of the Fertilizer Control Order, 1985, inasmuch as, there was no signature of the proprietor or his representative on the same so that it could be termed as the stock register of the registered firm. During the hearing before the appellate authority a copy of the stock register was shown by the District Agriculture Officer. In reply, the representative of the firm submitted that the stock register is maintained and is duly certified by the District Agriculture Officer, but he could not show any signature of any representative of the firm on it. In this very charge it is also alleged that from the firm Jubilant Organosys, 8000 bags of fertilizer were lifted by the petitioner on 27.10.2008, 28.10.2008 and 29.10.2008, but they were entered into the stock register at page 122 and 123 on 31.10.2008 only, which according to the Rules should have been entered in the stock register on each and every date, as and when they were received. The explanation submitted by the Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 8 representative of the petitioner was that since the lifting of bags of the fertilizer was continuing, due to lack of time the same was separately not entered into the stock register on each and every date, and was entered into the register after the stock was received, which was informed to the District Agriculture Officer verbally. This information was denied by the District Agriculture Officer. In view of the stand of the parties, the Appellate Authority found this charge proved against the petitioner. Now coming to the enquiry report in respect of this charge, this Court finds that, the inspecting team had visited the premises of the petitioner on 26.10.2008. The stock register was produced before the inspecting team and its findings were as follows :- The above findings of the enquiry team shows that it did not find anything wrong in the stock register and it found all the fertilizer allotted to the firm entered into it. On 26.10.2008 it Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 9 did not find the bags of fertilizer allotted to it from the Jubilant Organosys received there. The reply of the petitioner and the submissions before the Appellate Authority on its behalf shows that it was the specific stand of the petitioner before the Appellate Authority that the stock register being maintained in the firm was duly certified by the District Agriculture Officer. It is also admitted position that the stock of fertilizer allotted to it on 26.10.2008 from the Jubilant Organosys was lifted and transported to the go-down of the petitioner on 27th, 28th and 29th and, after completion of the transportation, the same was entered into the stock register on 31st. This shows that the stock register was being maintained by the petitioner which was duly certified by the District Agriculture Officer. It may be that due to continued lifting and transportation, the large numbers of fertilizer bags, received on each and every date was not entered into the stock register. But
Legal Reasoning
there is no dispute that the entire stock was entered into the stock register on 31.10.2008 itself, i.e., only two days after. There may be a little delay, but this Court fails to appreciate that how this can be a ground for cancellation of the registration altogether. The respondents have taken it as violation of clause 35(1)(a) of the said Control Order. The said clause 35(1)(a) reads as follows : (a) To maintain such books of account Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 10 records etc. relating to their business in form ‘N’. In this sub clause (a), there is no such stipulation that the part of the stock received on each and every date, had to be entered on that very day. Learned counsel for the respondents has also not show any other provision in the Control Order to this effect. Hence, in the opinion of this Court entry of entire stock after lifting the entire fertilizer bags under one allotment, in one transaction, may be sufficient compliance of the requirement of law. Matter would have been different if the petitioner would have lifted only part of the allotment and would have left the rest for indefinite period and on that pretext would not have entered the part stock received in the stock register. But in this case, it is undisputedly established that the entire stock under one allotment was lifted in one continued process. It has not been denied by the respondents during the hearing of the appeal or in the counter affidavit that stock register of the petitioner was duly certified by the District Agriculture Officer. Hence, mere absence of signature of any representative on the stock register will not, in the opinion of this Court, be a violation of said sub-clause (a). Second charge, leveled by the District Agriculture Officer against the petitioner, was that the cash memos of the sold Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 11 fertilizer were not being maintained in form ‘M’, as they did not contain signature of the purchasers of the fertilizer. In support of this, the representative of the District Agriculture Officer showed one volume of cash memos without signature of the purchasers. Reply of the representative of the petitioner was that, due to heavy work load, it may be possible that in some volumes the signature of the purchaser could not be taken. This explanation has been accepted by the Appellate Authority and it has come to the conclusion that this violation by the Firm was not deliberate. Though the explanation on behalf of the petitioner, in respect of this charge, has been accepted by the Appellate Authority, but it is being noticed only to show that the similar explanation on behalf of the petitioner in respect of some other charges have not been accepted by the Appellate Authority without any valid reasons. The 3rd charge against the petitioner was that the stock lifted by the petitioner on 20.10.2008, 24.10.2008 and 28.10.2008, under delivery order no.127221, from M/s Tata Chemicals Limited (TCL), were entered at page 101 of the stock register on 28.10.2008. In support of this, the representative of the District Agriculture Officer referred to the inspection report and learned counsel submitted that the petitioner has accepted this charge before this Court also. The explanation of the representative of the Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 12 petitioner was that during the transportation, there were repeated traffic jams on the bypass road and the employees of the firm were busy in lifting and transporting of fertilizer bags. Hence, the number of the bags received on each day could not be entered into the stock register. But admittedly the same was entered into in the stock register on 28.10.2008 after receiving the entire stock under one allotment order. As pointed out earlier, the said sub-clause (a) does not stipulate that if allotment received and transported to the godown of a firm on successive dates had to be entered into in piecemeal and part by part. It may also be pointed out that, whereas verbal explanation of the representative of the petitioner in respect of charge no.2 was accepted by the Appellate Authority, but identical verbal explanation in respect of this charge was not accepted by it. The fourth charge against the petitioner was that from 15.10.2008 to 30.10.2008 fertilizer was withheld by it in its godown. Rabi season had starts and during this period fertilizer was needed by the farmers at a large scale. Not selling the fertilizer during this period was therefore an attempt by the petitioner to create artificial shortage in the market and to encourage black-marketing. The explanation of the representative of the petitioner was that no retailer of fertilizer had contacted it Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 13 during the period for purchase of fertilizer and no one had made any complaint against it in this regard. Hence, in absence of any complain, no sale of fertilizer during these fifteen days could be taken as an attempt to encourage black-marketing. It was stated by the representative of the District Agriculture Officer that, after lifting of fertilizer, the Firm did not issue any information to the retailers for lifting of the fertilizer, which was denied by the representative of the petitioner and was stated that information was given to the retailers by phone. But the Appellate Authority has found that no proof of the same was being produced on behalf of the petitioner. In these circumstances, the Appellate Authority found the explanation submitted on behalf of the Firm as not correct and found the charge proved. Learned counsel for the respondents had called for the original records and has produced the same in the Court on the day the matter was heard i.e. on 12.8.2013. However, after going through the records, he fairly accepted that no material was available on the record to substantiate this charge as also charge no.5, also found proved against the petitioner. Thus, it has to be held that the respondents had not received any complaint against the petitioner of having stock of fertilizer and withholding it between 15.10.2008 to 30.10.2008, i.e. for fifteen days. In the Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 14 circumstances, the conclusion of the District Agriculture Officer as well as Appellate Authority, that the same was deliberately withheld by the petitioner is apparently presumptive and without any basis. At this stage, it will be appropriate to revert back to the charge no.1 and 3. These charges show that between 20.10.2008 to 29.10.2008, petitioner was lifting and transporting the bags of fertilizers under allotment orders against two different firms. The allotment of fertilizers from M/s TCL was received by the petitioner and the lifting completed on 28.10.2008 and same was entered into the stock register on that day, whereas the allotment of fertilizers from the Jubilant Organosys was received and the lifting completed on 29.08.2008 and the same was entered into the stock register on 31.10.2008. Hence it is apparent that during the period 15.10.2008 to 31.10.2008, when it is alleged that the petitioner was withholding the fertilizer to create artificial shortage, it was still getting the stock of fertilizer from different firms and was in the process of lifting and transportation of the same to its godown. This fact, admitted by the respondents also, has been totally overlooked by the District Agriculture Officer as well as by the Appellate Authority while considering this charge. The 5th charge against the petitioner is that the petitioner had sold fertilizer to one M/s Jagdamba Fertilizer Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 15 through cash memos dated 06.10.2008, 10.10.2008, 11.10.2008 and 21.10.2008, but when the inspecting team visited the premises of the said Jagdamba Fertilizer it did not find the stock there. The explanation of the representative of the petitioner before the Appellate Authority was that due to traffic jam there was delay in receipt of the fertilizer by the M/s Jagdamba Fertilizer. It was also stated that, out of 700 bags of fertilizer sold to M/s Jagdamba Fertilizer, 250 bags were damaged and therefore they were taken back. In reply it was stated by the representative of the District Agriculture Officer that inspecting team had visited the premises of M/s Jagdamba Fertilizer on 15.11.2008 still the fertilizer had not been received there. It was also stated that the fertilizer was made available to the M/s Jagdamba Fertilizer after deposit of money by it. Hence, the circumstances under which 250 damaged bags were made available to it, which were taken back by the petitioner, shows that the petitioner had manufactured papers later on, which fact was denied by the representative of the petitioner. The inspecting team had visited the premises of M/s Jagdamba Fertilizer also. The findings of the inspecting team in respect of inspection of its premises were as follows :- Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 16 I II III IV These findings show that sale of 950 bags of fertilizer by the petitioner to the M/s Jagdamba Fertilizer was in the month of October. The representative of the M/s Jagdamba Fertilizer did not dispute this. During the inspection the inspecting team found that the records of the M/s Jagdamba Fertilizer were not up-to- Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 17 date. The proprietor of the M/s Jagdamba Fertilizer gave an explanation that since Munshi of the Firm was ill, therefore, entries in the register could not be made. During the inspection, the inspecting team found that the fertilizer was being sold to the farmers. Thus, the inspecting team did not find anything wrong in the sale of fertilizer by the petitioner to M/s Jagdamba Fertilizer or received any complaint by the proprietor of the M/s Jagdamba Fertilizer against the petitioner in this regard. Before the Appellate Authority the representative of the District Agriculture Officer raised a question as to why the 250 damaged fertilizer bags were supplied by the petitioner to the M/s Jagdamba Fertilizer which it had to take back. But the Appellate Authority has failed to appreciate that the sale was made to the M/s Jagdamba Fertilizer by the petitioner on 6.10.2008, 10.10.2008, 11.10.2008 and 21.10.2008 which was much prior to the allotment of new stock was received by the petitioner, as is apparent from the charge no.1 and 3. In the circumstances, obviously fertilizer, which were sold to M/s Jagdamba Fertilizer on those dates, was of old stock. Hence, there was no circumstance to rule out the possibility that the bags were damaged. Moreover, learned counsel for the respondents, after looking to the records, has accepted before this Court that there is no other material available on record in respect Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 18 of this charge against the petitioner, which necessarily implies that no complaint by the M/s Jagdamba Fertilizer is available on record in this regard against the petitioner. Moreover, as shown above, this charge is also not substantiated from the findings in the Inquiry Report. This Court has dealt with the charges against the petitioner and the findings of the respondents in detail only due to the reason that the matter has traveled to this Court a number of times without getting finally concluded. After looking to the facts and materials, this Court finds that the materials available with the respondents, do not in any way support or establish the charges. In fact on the other hand this Court finds that the findings of the respondents against the petitioner in respect of the charges are on non-est grounds without any cogent or reliable material available, presumptive and without appreciation of over all facts situation and not supported by the findings of the enquiry team as well. In the circumstances, this Court finds that the order of the District Agriculture Officer, as contained in Annexure-11, and the order of the Appellate Authority, as contained in Annexure-16, are not based on records, perverse and unsustainable in law and fit to be quashed. The same are accordingly quashed. The petitioner’s certificate of registration was Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 19 cancelled first by the District Agriculture Officer by order dated 18.4.2009, as contained in Annexure-5. Since then the matter has traveled to this Court and back to respondents a number of times. The entire basis of the action against the petitioner by the respondents is the enquiry report, as contained in Annexure-2, which as shown earlier in this order does not support the charges framed against the petitioner in the manner it has been done. Hence, in the facts and circumstances of this case, this Court finds that it is appropriate to quash the charges also framed against the petitioner as well, as reflected in the last notice dated 27.11.2011, as contained in Annexure-11. The same is also accordingly quashed. This Court, in the interest of justice, is of the opinion that the dispute be given a quietus. Hence, this writ application is allowed without any leave to the respondents to take any further action against the petitioner in the matter on the basis of the said enquiry report and consequential findings of the respondents in that regard. The certificate of registration of the petitioner shall stand revived counting its remaining period of validity from today onwards. The respondents are restrained from taking any further action against the petitioner for any act or omission on its part committed prior to the cancellation of its registration by the order Patna High Court CWJC No.8174 of 2013 (5) dt.31-10-2013 20 of the District Agriculture Officer dated 18.4.2009, as contained in Annexure-5. Arvind/- (Jayanandan Singh, J)