1984 (1) TMI 340 - SC - Indian Laws

Summary

Issues Involved:
1. Validity of the State Government's Notification dated June 14, 1974.
2. Power of the State Government under the Defence of India Rules, 1971.
3. Alleged inconsistency between the Central and State notifications.
4. Alleged violation of Article 14 of the Constitution of India.

Issue-Wise Detailed Analysis:

1. Validity of the State Government's Notification dated June 14, 1974:
The appellants challenged the validity of the State Government's notification dated June 14, 1974, which restricted the sale price of fertilizers from old stocks to the pre-revision rates. The notification aimed to prevent dealers from charging higher prices for fertilizers acquired before the price hike on June 1, 1974. The Supreme Court upheld the High Court's decision, which confirmed the validity of the notification, emphasizing that the notification was issued to prevent unjust enrichment of dealers at the expense of cultivators.

2. Power of the State Government under the Defence of India Rules, 1971:
The appellants argued that the State Government lacked the power to issue the impugned notification under the Defence of India Rules, 1971, as the regulation of fertilizer prices should fall exclusively under the Essential Commodities Act, 1955. The Supreme Court rejected this contention, affirming that both the Essential Commodities Act, 1955, and the Defence of India Rules, 1971, are valid legislations enacted by Parliament. The Court held that there is no constitutional or jurisprudential limitation preventing the creation of two sources of power for regulating prices.

3. Alleged inconsistency between the Central and State notifications:
The appellants contended that the State notification was inconsistent with the Central notification issued on June 1, 1974. The Supreme Court examined whether there was any irreconcilable inconsistency between the two notifications. The Court found that the Central notification was silent on the issue of old stocks, while the State notification specifically addressed this aspect. The Court concluded that the two notifications were supplementary rather than inconsistent, as the State notification aimed to prevent exploitation and promote the objectives of both the Central and State regulations.

4. Alleged violation of Article 14 of the Constitution of India:
The appellants argued that the State notification violated Article 14 of the Constitution, claiming discriminatory treatment as governmental agencies were allegedly allowed to sell fertilizers at higher rates. The Supreme Court found no evidence supporting this claim, as the State Government had not granted any such permission. The Court held that the allegation of discrimination was unfounded, and the High Court was justified in rejecting this contention.

Conclusion:
The Supreme Court dismissed the appeals, confirming the validity of the State Government's notification dated June 14, 1974. The Court emphasized that the notification was issued to prevent unjust enrichment and exploitation of cultivators by dealers. The Court also vacated the interim orders and directed the concerned District Magistrates to take appropriate steps to return the differential amounts deposited by the dealers to the cultivators within six months.