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Issues Involved:
1. Validity of the Andhra Pradesh Catering Establishments (Fixation and Display of Prices of Foodstuffs) Order, 1978. 2. Competence of the State Government to issue price control measures for cooked food under the Essential Commodities Act, 1955. 3. Alleged arbitrariness and unprofitability of the maximum prices fixed under the impugned orders. Summary: 1. Validity of the Andhra Pradesh Catering Establishments (Fixation and Display of Prices of Foodstuffs) Order, 1978: The hoteliers of Andhra Pradesh challenged the 1978 Order, which mandated the display of prices and fixed maximum prices for certain food items. The petitioners argued that the prices should be re-examined to ensure a reasonable return on investment, satisfying Art. 19 (1) (g) of the Constitution. The Court found that the petitioners suppressed material facts and obtained an ex-parte stay order, which was unjustified. The Court held that the review of prices at reasonable intervals is implicit in any price fixation measure and rejected the petitioners' contention about the impossibility of complying with the conditions of the Orders. 2. Competence of the State Government to issue price control measures for cooked food under the Essential Commodities Act, 1955: The petitioners argued that the State Government lacked the authority to issue price control measures for cooked food, as the Essential Commodities Act, 1955, did not cover cooked food. The Court rejected this argument, stating that the expression "foodstuffs" in the Act includes cooked food. The Court referred to previous judgments and dictionaries to support its interpretation that "foodstuffs" encompasses both raw and cooked food. 3. Alleged arbitrariness and unprofitability of the maximum prices fixed under the impugned orders: The petitioners contended that the maximum prices fixed were economically unprofitable and arbitrary. The Court declined to engage in a detailed examination of the cost structures presented by both sides, emphasizing that the mechanics of price fixation should be left to the executive's judgment. The Court noted that the petitioners had agreed to a review of prices after three months but instead sought an ex-parte stay, suppressing the fact that the latest order had replaced the earlier ones. The Court held that no price fixation order needs to guarantee profit for each unit of article served or sold, and the overall trade or commerce picture should be considered. The Court found no merit in the petitioners' contentions and dismissed the petitions with costs. Conclusion: The Supreme Court dismissed the petitions, finding no merit in the contentions raised by the petitioners. The Court emphasized that the petitioners had obtained an unfair advantage by suppressing material facts and obtaining an ex-parte stay order. The notification fixing the maximum prices will revive and can be enforced, but the unjust enrichment enjoyed by the hoteliers during the stay period cannot be undone. The petitions were dismissed with costs.
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