M/s Bhagat Rice Mills v. The State of Haryana & Ors.

CORAM: HON’BLE MR. JUSTICE K. KANNAN ------ Present: Mr. Suresh Kumar Yadav, Advocate, for the petitioner. Mr. Ravi Dutt Sharma, Deputy Advocate General, Haryana, for respondents 1 and 4. Mr. Pankaj Gupta, Advocate, for respondents 2 and 3. -----

1. Whether reporters of local papers may be allowed to see the judgment? No. To be referred to the reporters or not? No.

2. 3. Whether the judgment should be reported in the digest? Yes. ----- K.Kannan, J (Oral)

1. The petitioner challenges an order of recovery which is sought to be made from the milling charges payable for the Kharif Marketing Season 2008-09, the amount which purports to be the transportation charges for the previous years 2004-05 and 2005-06. The challenge to the demand for recovery is on the basis that the milling charges for even those relevant years 2004-05 and 2005-06 had been paid after due satisfaction by the authorities of tenability of the claims and the goods that had been transported to the petitioner were from storage points within a distance of 8 kilometers from the location of the Civil Writ Petition No.7319 of 2009 (O&M) - 2 - petitioner's Mill. The contention of the petitioner is that the charges levied were as per the contract and that included the costs of transport which they bore themselves. It is the contention of the petitioner that the transportation from the storage point to the Mill had not been borne by the respondents and, therefore, the issue of recovery of transportation charges for the years 2004-05 and 2006-07 from out of the amount due and payable to the petitioner, cannot be made.

2. The respective learned counsel appearing for the respondents rely on the clause 4 (vii) in the agreement of the year 2004 which sets out among other activities that the miller shall make transportation of milled rice to Railway Station and loading into wagons etc. and also the transport of milled rice to the storage point of the Government including those of the hired godowns as per the directions of the FCI, unloading of trucks and delivery after inspection. While the service of the petitioner shall include the transportation of milled rice to the storage point of FCI, the question of payment of transportation charges is governed through an independent clause, clause (6) which reads as follows:- “The delivery of paddy shall be made on book weight to the miller which shall be covered by Bank guarantee. In case paddy is delivered from storage depot of the Government within 8 kms. it will be transported by the miller at his cost including loading, unloading and stacking charges. In case paddy is lifted by the miller from the storage point beyond 8 kms all the expenditure concerning with transportation and loading charges will be paid by the miller and it is payable by the government as per DC rates or FCI rates whichever is less. Paddy will be in the joint custody of government and the millers till its milling is completed and rice delivered to Food Corporation of India.” Civil Writ Petition No.7319 of 2009 (O&M) - 3 -

3. The contention on behalf of the respondents is that in view of the fact that the petitioner was bound to extend the service as per clause (4) (vii), the transportation of the milled rice to storage point shall be done by the petitioner and, therefore, that would include also the charges that had been determined from the place of recovery by the State to the storage point.

4. In my view, the reading of the provisions of clause (4)(vii) and clause (6) are wrongly understood. While the service of the petitioner shall include transportation of milled rice to the storage point, clause (6) refers to delivery of paddy from the storage point of the Government which is within 8 kilometers to the place of milling. The petitioner's contention is that he has absorbed all the costs of transport from the storage point to the mill and what is now sought to be deducted is the alleged cost of transport by the respondents from mandi to their own storage point. There is no basis for calculation of such amount from the petitioner and there is no clause which entitles the respondents to effect such a recovery. The learned counsel refers to an unreported decision of this Court when a similar exercise was sought to be done by the respondents in M/s Aggarwal Rice & General Mills Versus Food Corporation of India and others in Civil Writ Petition No.17326 of 2002, dated 05.12.2002, when this Court repelled such an attempt and directed that the miller was entitled to the payment of the milling charges without suffering any deduction for alleged transportation charges for earlier years. Even apart from making reliance to this, I am taking the decision on the ground that it is not the case of the respondents that they Civil Writ Petition No.7319 of 2009 (O&M) - 4 - have suffered any transportation charges from the storage point to the petitioner's mill for a distance within 8 kilometers. Any cost incurred by the respondents to bring the paddy to their own storage point cannot be added as an item of expenditure which could be taxed on the petitioner by way of recovery. The demand for payment is unreasonable and it is quashed. The counsel for the petitioner states that the amount has already been deducted from the petitioner. Having regard to the fact that I have found that the demand is bad, the recovery is also bad and respondents 2 and 3 are liable to refund to the petitioner the amount deducted with interest at 9% from the date when the recovery was made till the date of actual payment. The payment shall be made within a period of 8 weeks from the date of the receipt of the copy of the order. The writ petition is allowed. However, there shall be no directions as to costs.

25.03.2010 sanjeev (K.KANNAN) JUDGE