9911796707
TMI Blog1996 (5) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... icals, edible oils etc. and is alleged to be one of the biggest manufacturer of edible oils with large turnover. Petitioner No. 2 is engaged in the business of dry-fruits and petitioner No. 3 is engaged in the business of manufacturing of labels and the annual turnover is estimated to be Rs.5.1 crores. Similarly, petitioner No. 4 is engaged in the business of manufacturing of labels. The respondents are under the Ministry of Food and Supplies and, Therefore, fall within the definition of 'State' within the meaning of Article 12 of the Constitution of India. The said respondents through their officers have powers to prosecute the petitioners for violating the provisions of Standards of Weights and Measures Act and the Rules framed thereunder. The object which is sought to be achieved by the Act, it is contended, is to lay down the standards of weights and measures or number pertaining to different commodities in conformation with the standards laid down by the International Bureau of Weights and Measures. The basic intention of the Act is that the commodities commonly used by people should be packed in rationalised standards quantities by weight, measure or number so as to f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quantity (in terms of weight, measure or number) of each such serving. (4) The statement on a package or label as to the net weight, measure or number of the contents thereof shall not include any expression which tends to qualify such weight, measure or number : Provided that the Central Government may, by rules, specify the commodities, the weight or measure of which is likely to increase or decrease beyond the prescribed tolerance limits by reason of climatic variations ; and it shall be lawful for the manufacturer or packer of the commodity so specified to qualify the statement as to the net content of such commodity by the use of the words when packed . Explanation :- The words when packed shall not be used in any case except a case to which the proviso to sub-section (4) applies. (5) Where the Central Government has reason to believe that there is undue proliferation of weight, measure or number in which any commodity is, or reasonably comparable commodities are, being packed for sale, distribution or delivery and such undue proliferation impairs in the opinion of that Government, the reasonable ability of the consumer to make a comparative assessment of the prices afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... declarations as are required to be made under these rules. The relevant portion of Rule 6 deals with the declarations to be made on every package is to the following effect: (6) Declarations to be made on every package (1) Every package shall bear thereon or on a label securely affixed thereto a definite, plain and conspicuous declaration, made in accordance with the provisions of this Chapter as, to :- (a) the name and address of the manufacturer, or where the manufacturer is not the packer, of the packer or with the written consent of the manufacturer, of the manufacturer ; (b) the common or generic names of the commodity contained in the package; Explanation :- Generic name in relation to a commodity means the name of the genus of the commodity, for example, in the case of common salt, sodium chloride is the generic name. (c) the net quantity, in terms of the standard unit of weight or measure, of the commodity contained in the package or where the commodity is packed or sold by number, the number of the commodity contained in the package; (d) the month and year in which the commodity is manufactured or pre-packed; (c) the unit (retail sale price) of the commodity contai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed for pre-packing the concerned commodity: (C).......... .... Rule 23 may be reproduced as under: 23. Provisions relating to wholesale dealer and retail dealers :- (1) No wholesale dealer or retail dealer shall sell, distribute, deliver, display or store for sale any commodity in the packaged form unless the package complies with, in all respects, the provisions of the Act and these rules. (2) No retail dealer or other person including manufacturer, packer and wholesale dealer shall make any sale of any commodity in packaged form at a price exceeding the retail sale price thereof. Explanation :- For the removal of doubts, it is hereby declared that a sale, distribution or delivery by a wholesale dealer to a retail dealer or other person is a 'retail sale' within the meaning of this sub-rule, (4) Where, after any commodity has been pre-packed for sale, any tax payable in relation to such commodity is revised, the retail dealer or any other person shall not make any retail sale of such commodity at a price exceeding the revised retail sale price, communicated to him by the manufacturer, or where the manufacturer is not the packer, the packer and it shall be the duly of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terpreting in an untenably wide manner and to even restrict and alter the scheme of the parent Act purely on the ipse dixit of the respondents cannot be sustained; (c) The impugned actions are ultra vires the parent Act, arbitrary, unreasonable and discriminatory. Section 2(n) which defines labels to mean any written, marked, stamped, printed or graphic matter affixed to or appearing on any commodity or packing containing any commodity and such label and stickers can be used as it is permissible under the Act and, Therefore, the amendment to rule 4 cannot lake away this right of the petitioners; (d) the alleged amendment is purported to be for the purposes of furtherance of public interest. In fact, it does not serve any public interest. The circulars while baring use of sticker labels by manufacturers to make statutory declarations, permit the manufacturers to blank out the earlier declaration and reprint the revised declarations by other similarly placed methods, as provided under Section 2(n)(e) the impugned actions are excessive and colourable exercise of powers which in fact extend the state control on pricing of free market commodities indirectly and illegally, in spite of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t off date could be sold as such without attracting penal action. The purpose of the amendment was further explained by the Government of India in a communication dated 15th September, 1993 to M/s Vanaspati Manufacturers Association (page 196 of the paper book) which reads as follows: NO.WM-9(7)/93 Government of India Ministry of Civil Supplies, Consumer Affairs and Public Distribution 12-A, Jam Nagar House, New Delhi - 110011 Dated : 15th September, 1993 To: M/s Vanaspati manufacturers Association of India, 903, Akash deep Building, 26-A, Barakhamba Road New Delhi - 110001 Subject : Notification No. Gsr 578 A 26 August, 1993 regarding. Sir, Kindly refer to your representation No.R:2: dated 6th September, 1993 regarding the above mentioned Notification amending certain provisions of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977. The Government decided to withdraw the relevant provisions from the Rule permitting revision of prices by use of stickers by deleting Explanation clause to Rule-4 and adding a sub-clause 23 (7) with immediate effect. However, there are possibilities of packages lying in the market or in the pipeline with stickers before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il dealer or other person shall not charge such revised prices in relation to any packages except those packages which bear marking, indicating that they were pre-packed in the month in which such tax has been revised or fresh tax has been imposed or in the month immediately following the month aforesaid: Provided Also that where the revised prices are lower than the price marked on the package the retail dealer or other person shall not charge any price in excess of the revised price, irrespective of the month in which the commodity was pre-packed. (7) The matter was also considered by the 'Expert Committee on Best Method of determining the declaration of retail sale price on pre-packed commodities', as appointed by the Ministry of Civil Supplies, Consumer Affairs Public Distribution, New Delhi on 28th February, 1994. The use of stickers (small labels) on pre-packages was examined in detail and the following paragraphs (Chapter III) of the report may be of some relevance which read as under: WHILE discussing the issue of the use of stickers for altering the declarations made by manufacturers or for making first time declarations, the Committee considered the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich any essential commodity may be bought or sold. The dominant purpose of these provisions is to ensure the availability of essential commodities to the consumers at a fair price. And though patent injustice to the producer is not to be encouraged, a reasonable return on investment or a reasonable rate of profit is not the sine qua non of the validity of action taken in furtherance of the powers conferred by S.3(1) and S.3(2)(c) of the Essential Commodities Act. The interest of the consumer has to be kept in the forefront and the prime consideration that an essential commodity ought to be made available to the common man at a fair price must rank in priority over every other consideration. 59. We are not impressed by the play of statistics on the part of the petitioners which is designed to show that as a result of the Price Control Order, they are faced with a loss of about Rs.5.00 per kilogram on the sale of mustard oil. We will ignore, while we are on this point, the pronounced reiteration of the respondent that the petitioners have made huge profits in past years and that their concerns are sufficiently prosperous to be able to absorb a small loss for a temporary per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reasonableness of a classification made in an enactment to see if it infringed or was contrary to the constitution. In that decision for determining the question, even affidavit on behalf of the State of the circumstances which prevailed at the time when the law there under consideration had been passed and which necessitated the passing of that law was relied on. It was reiterated in State of West Bengal v. Union of India [1964] 1 SCR371 - that the Statement and Objects and Reasons accompanying a Bill, when introduced in Parliament, can be used for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation'. Similarly, in Pannalal Binjraj v. Union of India [1957] 1 SCR 233 a challenge to the validity of classification was repelled placing reliance on an affidavit filed on behalf of the Central Board of Revenue disclosing the true object of enacting the impugned provision in the Income Tax Act. 17. Not only this, to sustain the presumption of constitutionality, consideration may be had even to matters of common knowledge; the history of the times; and every conceivable state of facts existing at the time of legislat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the consumer and there was no necessity to amend them by introducing the impugned notification. It is, Therefore, argued that the manufacturer or the retailer, as the case may be, is permitted to use the label which means any written marks, statements printed, graphic matter affixed to or appearing upon any commodity or package containing any commodity as defined in Section 2(n). Similarly, Section 39 lays down the relevant provisions for the manufacturer to comply and give details of the information as referred to, which will indicate that sufficient safeguards are provided in the provision and there was no necessity of banning the use of label or the sticker, as the case may be. This reasoning is perhaps based on misapprehension as the amendment does not, in any manner ban the use of the label or the sticker. It only implies that the manufacturer or packer shall not alter the price on the wrapper once printed or used for packing. Therefore, the only purpose behind the new provision is that all the information which is to be given in terms of the statute can be printed on one label or sticker and there is no need to put repeated labels or stickers which practice has often been u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e power granted, and on relevant consideration of material facts. All his decisions, whether characterised as legislative or administrative or quasi- judicial, must be in harmony with the Constitution and other laws of the land. They must be reasonably related to the purposes of the enabling legislation . See Leila Mourning v. Family Publications Service (1973) 411 Us 356. If they are manifestly unjust or oppressive or outrageous or directed to an unauthorised end or do not tend in some degree to the accomplishment of the objects of delegation, courts might well say, Parliament never intended to give authority to make such rules; they are unreasonable and ultra vires : per Lord Russel of Killowen, C.J. in Kruse v. Johnson (1898) 2 Qb 91. The doctrine of judicial review implies that the repository of power acts within the bounds of the power delegated and he does not abuse his power. He must act reasonably and in good faith. It is not only sufficient that an instrument is in travires the parent Act, but it must also be consistent with the constitutional principles: Maneka Gandhi v. Union of India [1978] 2 SCR 621. The true position, Therefore, is that any act of the repository of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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