HON’BLE SRI JUSTICE A. RAMALINGESWARA RAO WRIT PETITION No.151 of 2008
Date: July 04, 2014
Between:
1. S.V. Industries, Jammikunta, Karimnagar District, rep. by Its Partner S. Nagaraj & another.
… Petitioners And
1. Union of India, Ministry of Food and Public Distribution Department, New Delhi, rep. by its Secretary & 3 others.
… Respondents * * * HON’BLE SRI JUSTICE A. RAMALINGESWARA RAO WRIT PETITION No.151 of 2008
O R D E R:
Heard learned counsel for the petitioners and none appeared for the respondents. No counter-affidavit is filed by the respondents.
2. The petitioners are engaged in the business of purchasing Paddy and converting the same by milling into rice for further sale. In the course of their business, the petitioners procure Paddy from farmers directly as also at the Market Committee constituted under the A.P. Agriculture (Produce and Livestock) Markets Act. The purchase of Paddy and milling the same is regulated by the Control Orders issued under the provisions of the Essential Commodities Act, 1955. Under clause 3 of the Andhra Pradesh Rice Procurement (Levy) Order, 1984, every licensed miller is bound to sell to the Food Corporation of India/State Corporation at the procurement price 75% of the total quantity of rice milled out of every day stocks of Paddy. Clause 4A of the said Control Order prohibits a miller from purchasing Paddy at a price lower than the notified price. The Government of Andhra Pradesh in exercise of its powers under Control Order, issued G.O.Ms.No.38, Consumer Affairs, Food and Civil Supplies (CS-1) (1) Department dated 24.09.2007 notifying the procurement policy for the Khariff Marketing Season (KMS) 2007-2008 and fixing procurement price (minimum support price) for Paddy. The petitioners state that they commenced the purchase of Paddy from 01.10.2007 by paying minimum support price (MSP).
3. The Government of India vide its Proceedings No.171(3)/2007-Py.1 dated 12.10.2007, communicated its decision to give incentive bonus of Rs.50/- per quintal for procurement of Paddy during Khariff Marketing Season 2007-2008 over and above the MSP. The communication further states that the incentive bonus will be applicable during the entire procurement period in KMS 2007-2008. The said order was communicated by the Government of Andhra Pradesh on 16.10.2007 to the rice millers through their associations. Accordingly, the petitioners paid the MSP together with the incentive bonus to the farmers with effect from 16.10.2007. The Government of India issued further Proceedings on 21.11.2007 giving additional incentive bonus of Rs.50/- per quintal over and above the bonus of Rs.50/- per quintal already announced for procurement of Paddy during KMS 2007- 2008. It was communicated by the Government of Andhra Pradesh on 24.11.2007. The additional incentive bonus was paid by the petitioners to the farmers with effect from 24.11.2007. The petitioners challenge the applicability of incentive bonus and additional incentive bonus during the entire procurement period of KMS 2007-2008 in Proceedings dated 12.10.2007 and 21.11.2007 on the ground that they started procuring the Paddy from 01.10.2007 and the incentive bonus and the additional incentive bonus cannot be paid by them prior to the date of issuance of the orders. The 4th respondent vide his notice dated 29.12.2007 directed the petitioners to pay the incentive bonus of Rs.100/- (Rs.50/- + Rs.50/-) per quintal for the purchases made from 01.10.2007 with a threat of taking action under the provisions of Control Orders. The said notice was issued as the incentive bonus and additional incentive bonus will be applicable during the entire procurement period in KMS 2007-2008 in the Proceedings dated 12.10.2007 and 21.11.2007 respectively. It amounted to retrospective application of the payment of incentive and additional incentive bonus and the same is challenged in the present writ petition.
4. An identical issue was considered by this Court in W.P.Nos.25901, 25919, 26045 & 26407 of 2007 and W.P.Nos.21849 of 2007 and W.P.No.3197 of 2008 and it was held as follows:
“There cannot be any dispute that application of the policy under the impugned order has imposed fiscal liability on the petitioners with retrospective effect and their failure to discharge the liability for the past transactions would attract penal provisions for contravention of Clause 12 of the Control Order read with Section 7 of the Essential Commodities Act, 1955. It is a settled proposition of law that no person shall be subjected to penal proceedings with retrospective effect on the basis of law subsequently enacted. Thus, I am of the considered view that the impugned order of the Union of India, dated 24.4.2007 to the extent of its application retrospectively from 1.4.2007 to 24.4.2007 is not legal and sustainable and as such the consequential notices dated 15.11.2007 issued by the District Collector directing the petitioners to pay the amounts are not sustainable.”
5. In the instant case also proceedings were issued on 12.10.2007 and 21.11.2007, but it was sought to be made applicable with effect from 01.10.2007 by the 4th respondent on the ground that the incentive bonus and additional incentive bonus are applicable to the entire procurement period 2007-2008 which commenced on 01.07.2007. Hence, the retrospective application of such liability with effect from 01.10.2007 is not legal and the liability is applicable only with effect from 12.10.2007 and 21.11.2007 respectively in respect of the incentive bonus and the additional incentive bonus.
6. The writ petition is accordingly allowed. Pending miscellaneous petitions, if any, shall stand closed in consequence. No costs.
A. RAMALINGESWARA RAO, J Date: July 04, 2014 BSB
8 HON’BLE SRI JUSTICE A. RAMALINGESWARA RAO
WRIT PETITION No.151 of 2008
Date: July 04, 2014
BSB