P B Samant and ors Vs State of Maharashtra and ors - Citation 353652 - Court Judgment

Judgment:

B. Lentin, J.

1. The petitioners challenge the method of distribution of ad hoc cement in the State of Maharashtra as being contrary to the rule of law and probity in public life. Initially the petitioners has also challenged the vires of the Foreign Exchange Remittance Scheme. However, at the conclusion of the arguments, that challenge was not pressed.

2. The petitioner are social workers and consumers of cement. The 1st respondent is the State of Maharashtra. The 2nd respondent is the Chief Minister. The 3rd respondent is the Union of India.

3. It is the petitioners' case that as social workers and members of 'Samajwadi Manch', an organisation committed to seeing that sale and distribution of essential commodities is done in an equitable manner, they received several complaints from the public that cement was not available from the rationing offices either for building or repair work, that bona fide applications for cement were side-tracked and that cement was given in large quantities to persons who had secured recommendations from the 2nd respondent, Ministers and M.L.As. As the petitioners needed cement for urgent monsoon repairs to their houses, they applied for 5 bags each to the Deputy Controller of Rationing (Bombay Region). However, no cement was made available to them. The petitioners came to know that large quantities of cement were being allotted by the 2nd respondent directly from Mantralaya in violation and circumvention of the statutory distribution scheme. In order to ascertain the factual position for himself, the 1st petitioner visited the Food and Civil Supplies Department in Mantralaya in June 1981, where a notice was displayed that no applications for cement would be entertained at Mantralaya and that all pending applications received in the department had been forwarded to the respective cement distribution committees through the Controller of Rationing/Collector and that future enquiries should be made with the Tahsildar/Food Grains Distribution Officers/Deputy Controller of Rationing concerned. It is the petitioners' grievance that despite this notice and in violation of the statutory cement distribution scheme, large quantities of cement were unauthorisedly, arbitrarily and mala fide allotted directly from Mantralaya by the 2nd respondent to builders, as a quid pro quo for contributions to certain trusts created and controlled by the 2nd respondent in his private capacity and of which he is a trustee, with the result that bona fide applicants received a meagre, and in some instances no allocation at all. Instances of such cement allocation and distribution ranging from 350 tonnes to 1,000 tonnes to builders have been set out in the petition. The petitioners are indignant, inter alia, that (i) whereas in 'D' Zone (Bandra to Dahisar) 4,128 applications are pending for want of cement, it received only 8,808 tonnes against 16,660 tonnes allocated by the Deputy Controller of Rationing, as against which seven applicants named in the petition received 6,150 tonnes and 142 applicants received 20,260 tonnes directly from Mantralaya, which far exceeded the allocation to the entire 'D' Zone itself; (ii) in 1981, out of 900 applicants, not a single applicant received any cement; (iii) out of several thousand applicants who required cement for monsoon repairs, cement was received by a very small percentage and in extremely small quantities. It is, however, not merely on this indignation expressed by the petitioners but on the principles involved, that a judicial finding must be arrived at in this petition.

4. It was urged by Mr. Desai, the learned Counsel appearing on behalf of the petitioners, that allotments of ad hoc allocations received by the State Government form the Central Government, must be made in accordance with a certain Circular issued by the State Government on 31st March, 1981 read with Government Circular dated 2nd March, 1981 read with the guidelines laid down in a Government Resolution dated 12th September, 1978. In the alternative and in the event of it being held that the Circular of 31st March, 1981 does not apply to ad hoc allotments, it was urged that large quantities of cement were arbitrarily and mala fide distributed by the 2nd respondent to builders as a quid pro quo for donations directly or indirectly made by them as the trusts created and controlled by the 2nd respondent.

5. On the other hand, it was urged by Mr. Sen, the learned Counsel appearing on behalf of the 1st and 2nd respondents, that the Government Circular dated 31st March, 1981 did not apply and was not intended to apply to ad hoc allotments made by the Central Government to the State Government. It was further urged that it was not possible or practicable to make application of ad hoc allotments on the guidelines laid down in Government Resolution dated 12th September, 1978, which applied to the distribution only of the regular quarterly allotments made by the Central Government to the State Government. It was also urged that the Government Circular dated 31st March, 1981 was issued by mistake and misunderstanding. In response to the arbitrariness and mala fides attributed to the 2nd respondent, Mr. Sen urged that no allocations whatsoever were made by the 2nd respondent personally or under his directions, nor was there any element of quid pro quo between the allocations made to builders and the donations given by them to the trusts.

6. In order to appreciate these rival contentions, a brief resume of the legislative history of the distribution and control of cement in the State of Maharashtra, culminating in the Government Circular dated 31st March, 1981, is pertinent.

(A) 'In the Industries (Development and Regulation) Act, 1951, cement was included as a 'Scheduled Industry' as defined by section 3(1) of that Act. By Central Government Order dated 24th November, 1962, cement was included as an essential commodity under section 2(xi) of the Essential Commodities Act, 1955. Delegation of powers to the State Government was effected by Central Government Order dated 18th June, 1966. By reason of the increasingly acute shortage of cement, its sale and distribution were controlled and regulated by the Cement Control Order, 1967. The Maharashtra Cement (Licensing & Control) Order, 1973 was passed by the State Government for the control, distribution and sale of cement throughout the State of Maharashtra.

(B) In view of the frequent complaints of non-availability and black-marketing of cement and in order to re-organise and create a monopoly in the system of distribution and sale of cement, so as to ensure its equitable distribution at fixed prices throughout the State of Maharashtra, the State Government by its Food and Civil Supplies Department, issued a Resolution dated 12th September, 1978, directing that distribution of cement in the State from 1st October, 1978 was to be on the guidelines laid down therein. The salient features of this Government Resolution are : (a) the total distribution and sale of cement in the State would be controlled by the State Government from 1st October, 1978; (b) cement would be sold throughout the State through authorised dealers of the State Government; (c) the districtwise allocation of the public quota would be made by Government and communicated to the Regional Cement Controller, who would issue release orders against various cement producers; (d) quarterly public quota of cement allotted to the districts would be communicated to the Collector/Controller of Rationing by the Government for distribution among Taluka/Rationing Regions by the District Level Committees; (e) the quota allotted by Government to the Bombay and Bombay Suburban District should be allocated by the District Level Committee to each of the four Rationing Regions, viz., 'A', 'C', 'D' and 'E'; (f) the meeting of the meeting of the District Level Committee should be held as soon as the quarterly quota of cement allocated to the district was communicated to the Collectors/Controller of Rationing. The District Level Committees should constantly supervise and review the working of the cement distribution system and suggest improvements and should meet at least twice during the quarter in order to review the working of the cement distribution system and to assess the taluka-wise/region-wise requirements of cement for the forth coming quarter; (g) with effect from 1st October, 1978, the entire stocks of cement received by the dealers should be sold to consumers only against permits issued by the Tahsildars in the District and the Deputy Controller of Rationing in Greater Bombay; (h) all consumers requiring cement would have to apply to the Tahsildar/deputy Controller of Rationing within whose jurisdiction cement was proposed to be utilised; (i) the applicants quota of cement should be sanctioned by the Taluka Level Committee (Regional Level Committee in respect of Greater Bombay); (j) the consumer's application should immediately be entered in the prescribed register and an acknowledgment be issued; (k) applications should be classified category-wise for all different categories of consumers so as to enable Government to have reliable data about category-wise demands in different areas; (l) permits should be valid for 10 days only from the date of issue, during which period the permit-holder must lift the cement from the specified stockist. The period of validity of a permit should not normally be extended except for special reasons to be recorded on an application for extension and permits not utilised within the prescribed period would automatically lapse; (m) since the quantity applied for by the consumer would be in excess of availability, if the available stocks should be equitably distributed among different categories of consumers, as to obviate meeting the requirements of only a few categories to the exclusion of others. In order to achieve that objective, certain guidelines were laid down viz. (i) no cement should be issued to parties eligible to get cement from the Central quota and Rate Contract/other than Rate Contract parties or contractors executing their works, as they would be allotted quarterly quota of cement, (ii) allocation should be made by the committee among the different categories of consumers and thereafter to individuals in strict chronological order of applications in that category, (iii) in cases of large requirements, sanction should be by suitable instalments, (iv) the Secretary of the Committee should carefully prepare the list of sanctioned cases and the signatures of the members present should be obtained, (v) the list should be forwarded by the committee to the Tahsildar/Deputy Controller of Rationing for permits to be issued to the applicants, and (vi) permits should be issued in chronological order.

(C) The Cement Control (Amendment) Order, 1979, empowered the Central Government to authorise a State Government to decide, subject to such condition as may be specified and within the total quantities of cement allotted to the State Government by the Central Government from each cement producer, the details of the allottees and the quantities to be supplied to each of them by each cement producer.

(D) On 20th September, 1980, a letter was addressed to the Collector/Controller of Rationing, Bombay, by Mr. Sayed Yakoob, Assistant Secretary to Government, Food and Civil Supplies Department, stating that no application for allotment of cement directly by Government would be entertained unless the same was supported by a certificate issued by the concerned Regional Deputy Controller of Rationing/Food grains Distribution Officer/Tahsildar, as the case may be, containing certain particulars, to with, (i) whether the application has been registered with the concerned cement distribution committee and if so its registration number and date; (ii) the total entitlement of cement as approved by the committee; (iii) the quota already supplied from all sources; (iv) the date of the last instalment of cement released and the quantity and source of release; (v) the inability of the committee to meet the requirement from the stocks available with it. A copy of a press note containing the aforesaid directions issued by Government was also enclosed with that letter.

(E) By a Circular dated 2nd March, 1981 issued by the State Government (Food & Civil Supplies Department), the guidelines for sanctioning cement by the Tahsil/City/Regional Level Cement Distribution Committees as laid down in the Government Resolution of 12th September, 1978 were reiterated and nine categories were classified, commencing with agriculturists and ending with 'all categories of consumers for repairs and maintenance', with builders and developers ranking seventh in the category. This circular issued 'By order and in the name of the Government of Maharashtra' was signed by Mr. U.B. Tipnis, Deputy Secretary to the Government of Maharashtra. It was circulated to 'all Commissioners, all Collectors, the Controller of Rationing, Bombay, all Foodgrains Distribution Officers, all District Supply Officers.'

(F) On 31st March, 1981, the State Government (Food and Civil Supplies Department) issued a circular headed as under :--- 'Allotment of cement to consumers directly by Govt. from ad hoc quota released from Govt. of India.'

In this Circular it was stated that Government had decided that---

'......no applications for cement should be entertained directly by Government. All applications for cement should be considered by the Local Regional Level/City Level/Tahsil Level /Cement Distribution Committees in accordance with the guidelines issued by Government vide its Circular......dated 2nd March, 1981. The Controller of Rationing, Bombay and Collectors of district are requested to bring this to the notice of the Deputy Controllers of Rationing/Food grains Distribution Officers/Tahsildars and to instruct these officers not to issue any no objection certificates or to recommend any application for cement to Government henceforth.

'In accordance with the decision of Government mentioned above, any application that would be received directly by Government in future will be referred to the concerned Collector/Controller of Rationing, Bombay for suitable action. Application which have been received earlier by Government and still pending in this department will also be sent back to the respective Collectors and Controller of Rationing, Bombay for further necessary action. Lists of such applications are being prepared and the same will be sent in due course along with the applications to the Controller of Rationing, Bombay and Collectors concerned for onward transmission to the concerned officers for necessary action.'This circular signed by Mr. Sayed Yakoob, Under Secretary to the Government of Maharashtra, was issued 'By order and in the name of the Governor of Maharashtra', and was circulated to 'all Commissioner of Division/all Collectors (except Collector of Greater Bombay)/Controller of Rationing, Bombay/all Foodgrains Distribution Officers/Dy. Controller of Rationing, Bombay, A/C/D/E Regions/all Tahsildars, all District Supply Officers, Private Secretary to Minister (Food and Civil Suppliers) Personal Assistant to Minister of State (Food and Civil Supplies)'.

7. Such is the legislative history of distribution and control of cement in the State of Maharashtra.

8. The first question that arises is whether the Government Circular dated 31st March, 1981 applies to the guidelines for cement distribution as laid down in the Government Resolution dated 12th September, 1978. On a plain reading of the Government Circular dated 31st March, 1981, read with Government Circular dated 2nd March, 1981, the answer must be in the affirmative. It is clear that the Circular dated 31st March, 1981 in terms refers to allotments from the ad hoc quota, as is manifest from the very heading of the Circular reproduced in sub-para (F) above. This Circular also specifically refers to the guidelines in the earlier Government Circular dated 2nd March, 1981 which in turn specifically refers to the Government Resolution dated 12th September, 1978 and reiterates the guidelines which re-affirm the entire Government Resolution dated 12th September, 1978. The Circular of 31st March, 1981 directs the Controller of Rationing and Collectors to bring to the notice of the Deputy Controllers of Rationing/Food grains Distribution Officers/Tahsildars that no applications would be considered directly by Government and that all applications should be considered by the Local Regional Level/City Level/Tahsil Level/Cement Distribution Committees in accordance with the guidelines issued by Government vide its Circular dated 2nd March, 1981, with instructions to those officers not to issue no objection certificates or recommendatory applications to Government henceforth. It could not be clearer that the Circular dated 31st March, 1981 is expressly made applicable to ad hoc allotments nor merely for passing formal orders but for substantially carrying out the Government Resolution dated 12th September, 1978 and the guidelines laid down therein. Reading the Circular dated 31st March, 1981 with the Circular dated 2-3-1981 (which is referred to in the later Circular of 31st March, 1981) and the Government Resolution dated 12th September, 1978 (which is refereed to in the Circular dated 2nd March, 1981), it is abundantly clear that Government intended that for the distribution of ad hoc allocations, the guidelines laid down in the Government Resolution of 12th September, 1978 would be followed. The connection between the Circular dated 31st March, 1981 and the Circular dated 2nd March, 1981 and the Government Resolution dated 12th September, 1978 is unmistakably established, making equitable distribution of ad hoc cement mandatory in consonance with the guidelines laid down in Government Resolution dated 12th September, 1978. This is brought to the forefront from the representation in the Circular dated 31st March, 1981 that Government had decided that no applications for cement would be entertained directly by Government and that all applications would be considered by the Local Regional Level/City Level/Tahsil Level/Cement Distribution Committees in accordance with the guidelines laid down in the Circular dated 2nd March, 1981 which, as stated earlier, reiterated the guidelines which re-affirm the entire Government Resolution dated 12th September, 1978. The Circular dated 31st March ,1981 was not some secret or highly classified documents or a private one. It was issued by a highly placed and responsible Government Officers, viz. the under secretary himself by order and in the name of the Governor of Maharashtra. It was circulated to all the concerned heads of departments as stated in the Circular itself. A notice was even admittedly put at Mantralaya. This Circular is still in force. In these circumstances, the Government Circular dated 31st March, 1981 read with Government Circular dated 2nd March, 1981 can lead but to one conclusion namely, that Government had decided that ad hoc allotments should be distributed according to the guidelines laid down in the Government Resolution dated 12th September, 1978.

9. Mr. Sen, however, urged that the Government Circular dated 31st March, 1981 was not intended to and did not apply to ad hoc allotments because it was not possible or practicable to make allocations of ad hoc allotments on the guidelines laid down in Government Resolution dated 12th September, 1978, which only applied to distribution of the regular quarterly allocations. To start within if the Circular dated 31st March, 1981 was not intended to and did not apply to distribution of ad hoc allotments, why is this Circular still in force? Indisputably there was sufficient time and opportunity for the State Government to have withdrawn it. To date nothing of the kind has been done. Mr. Sen was unable to give an answer, (except to say that every one seems to have forgotten about this Circular, which is no answer at all) nor is one vouchsafed in any of the affidavits filed on behalf of the State Government. Thus during such time as this Circular is in force, it must necessarily be acted upon and it cannot lie in the mouth of the State Government now to say that it was not intended to and does not apply to ad hoc allotments in the teeth of the heading and contents of this Circular read with Government Circular dated 2nd March, 1981.

10. In support of the second leg of his contention namely that it was not possible or practicable to make allocations of ad hoc allotments on the guidelines laid down in the Government Resolution dated 12th September, 1978, Mr. Sen relied on the affidavits filed by Mr. Tipnis, Deputy Secretary, Food & Civil Supplies Department, Mr. V.T. Chari, Secretary to Government of Maharashtra, Food & Civil Supplies Department, Mr. Sayed Yakoob, Under Secretary, Food & Civil Supplies Department, and Mr. D.S. Kamale, Minister of State for Food and Civil Supplies Department. The sum total of these long, tortuous and repetitive affidavits is that the guidelines laid down in the Government Resolution dated 12th September, 1978 cannot apply to allotments of ad hoc allocations because prior thereto no ad hoc allotment was made by the Central Government except once when it was distributed by the State Government among Government and semi-Government bodies without following the procedure laid down in that Resolution. By the every nature of ad hoc allotments and the conditions attached thereto by the Central Government, ad hoc allocations cannot be governed by the distribution system envisaged by the Government Resolution dated 12th September, 1978. The conditions attached by the Central government to ad hoc allocation are : (a) the allotments must be picked up by the allottees from the factory itself. Except for two factories, the rest are outside Maharashtra; (b) the allottees must lift the cement released in their favour within the time prescribed; (c) the allottees must make their own arrangements for taking delivery at the factory; (d) regular quarterly allotments had to be transported by rail, whereas ad hoc allotments had to be carried from the factory by road only; (e) allottees had to carry the cements as direct consumers and not as stockists; and (f) the allottees ran the risk of non-delivery at the factory. For these reasons, the State government had to devise the best possible procedure for distribution of the entire ad hoc allotments so that they may not lapse for failure of the allottees to lift the quantities allotted to them immediately and to carry the same to Maharashtra. Cement available as a result of ad hoc allotment is distributed by the State Government in its discretion to various parties who are in need of cement after considering the urgency of their requirement, their capacity and willingness to take delivery on these conditions. Ad hoc allotments commenced from December 1978 with an allotment of 10,000 M.T. to Bombay region. This was distributed by the State Government without following the procedure laid down in the Government Resolution dated 12th September, 1978 but after obtaining the recommendations of the Regional Cement Committee. Thereafter the State Government selected only those persons whose needs were found to be genuine and who were ready and willing to transport the cement by road immediately. The ad hoc system of distribution on this basis was found to be practicable and reasonable. It was, however, found after some time that the procedure of inviting recommendations from the Regional Committees of Bombay and Taluka Level Committees and then making allotments to individuals on that basis was a slow and complicated process which could not be applied to ad hoc allotments as the same could not be lifted and carried immediately as required by the Central Government, with the result that there was a risk of the allotments not being lifted in time and lapsing. For allotments given in December 1978 and April 1981, recommendations were asked for only from the Bombay Regions. Thereafter the High Level Committee laid down the procedure for distribution of ad hoc allotments after recommendations from the Collector/Controller. Even that system had to be discontinued because between 6th April, 1981 and 21st April, 1981, no recommendation were received from the Collectors. Hence Government had to carry out the distributions without recommendations from the Collectors. This the Government did from Mantralaya. For the allocation of the regular quarterly allotments, there is a three-stage system. The first stage is that element is made by the State Government to certain categories, viz. rate contract parties, other than rate contract parties and public sale quota allotment. In so far as rate contract parties are concerned, the Directorate General of Supplies and Disposals has entered into a contract with the cement procedures for the supply of cement. All Government Departments, both in the Central and State, are eligible to obtain the supplies by following the procedure prescribed in the Director General of Supplies and Disposals Rate Contract. A rate contract envisages the booking of a supply order directly by the designated official of the concerned Government Department with the concerned cement producer in the prescribed form. Certain quasi-Government bodies are also permitted to obtain supplies under the Rate Contracts systems. All other parties which are not public sector or quasi-Government bodies, come under the category 'Other than Rate Contract Parties', which generally comprise of allottees like industries, institutions, colleges and schools. The second stage is allotment made to stockists by the Collector in the districts and by the Controller of Rationing for the 4 Bombay Region. The third stage is the release or allocations by way of permits to individual consumers by Tahsildars in the districts and the Deputy Controller for the Bombay Regions. After the stockists received and stored their quota, further distribution of cement was made by issuing the permits to individual consumers for drawing the cement from the respective stockist. It was impracticable to adopt this three stage system in the case of ad hoc allotments. It was also not possible for stockists to lift the ad hoc allotments. Such is the substance of the affidavits.

11. The reasons given in the affidavits-in-reply for the purported inability to follow the guidelines laid down in the Government Resolution dated 12th September, 1978 for distribution of ad hoc allotments appear to be unconvincing. To start with, it is not entirely correct to say that except once, no ad hoc allotments were made by the Central Government prior to September 1978, as is manifest from the following ad hoc allotments made by the Central Government between July 1977 and March 1978 viz. prior to the Government Resolution dated 12th September, 1978 :---

July-September 1977 ... 5,27,400 tonnes

October-December 1977 ... 5,14,250 tonnes

January-March 1978 ... 5,75,000 tonnes.

Be that as it may, the version that the Central Government stipulated that ad hoc allotments had to be lifted only by road and regular quarterly allotments only by rail, is also not correct, for there are instances when lifting of ad hoc allotments and the regular quarterly allotments has been permitted by road or rail. To illustrate, there is a communication dated 23rd February, 1981 from the Regional Cement Controller to Mr. Chari himself, wherein in connection with an ad hoc allocation of 15,000 tonnes from Karur Factory, it is stated that dispatches would be 'by rail road'. In the letter dated 9th April, 1981 from the Assistant Cement Controller to Mr. Chari, in connection with an ad hoc allocation of 5,000 M.T. from the Yerranguntla Factory no condition of lifting by road or rail is even made, leaving it open for the allotment to be lifted either by rail or road. Similarly, the version that the regular quarterly allotments had to be transported only by rail, is directly contrary to a letter dated 6th July, 1981 from Mr. Tipnis to all Collectors, Controller of Rationing, all District Supply Officers, all Foodgrains Distribution Officers, all Assistant Commissioners (Supply), wherein in connection with the quarterly allocation for July-September 1981, the concerned officers were directed to ensure that the parties who got bulk allotments, lift the cement even by road in view of the scarcity of cement and even though transportation by rail would be cheaper. Furthermore, even if in some cases the cement was required to be picked up form the factory immediately and transported by road only, who could do so better than Government itself and distribute it to Government and semi-Government bodies, which according to Mr. Chari himself, Government itself had done in the past. To say, as Mr. Sen did, that Government has no trucks to carry the cement or any storage facility or that en-route there would be pilferage or adulteration of cement, is not exactly a happy reflection on the capability of the State Government. Mr. Sen's comment that if Government were to transport the cement, not less than 10% would be eaten away by rats and rodents, I shall attribute to a piquant sense of humour. In any event, if the State Government does not want to take upon itself this burden, it can ask Government or semi-Government bodies or even stockists, who would be more than willing to do so. The version that it is not possible for ad hoc allotments being lifted by stockists is an ipse dixit and is in terms negatived by a letter dated 18th June, 1981 from Mr. Syed Yakoob, Under Secretary to Government of Maharashtra, addressed to the Regional Cement Controller, wherein, in connection with an ad hoc allotment from a certain Tamil Nadu factory, it stated, inter alia, that 500 M.T. had been allotted to 3 stockists in Bombay, whose names and addresses have been given in that letter. No one has as yet said on affidavit that stockists were unwilling to pick up the cement from the factory or transport it by road or that these 3 stockists failed to pick up the cement allotted to them. The version that ad hoc allocations ran the risk of lapsing if not picked up within the stipulated time, is strained. For that matter, so would the regular quarterly allotments, if not picked up within the stipulated time. Mr. Sen's contention that the three-stage distribution system being a cumbersome one, would be an impediment to fast distribution of ad hoc allotments, should have been a factor taken into consideration before issuing the Government Circular dated 31st March, 1981 and not thought of thereafter. Even so that Circular is still in force and as long as it is, it must be adhered to, the purported impediment notwithstanding. One may recall the words of the Supreme Court in Commissioner of Police v. Gordhandas, : [1952]1SCR135 ---

'We are clear that public orders, publicity made, in exercise of a statutory authority, cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are dressed and must be construed objectively with reference to the language used in the order itself.' (The underlining is mine)

12. Where Mr. Sen is correct is in his submission that the guidelines laid down in the Government Resolution dated 12th September, 1978 pertain to distribution of the regular quarterly allotments made by the Central Government to the State Government and not to distribution of ad hoc allotments. The entire tenor of Government Resolution dated 12th September, 1978 is in connection with cement given by the Central Government by way of quarterly allotments and not by way of ad hoc allocations. Mr. Desai is not correct in his reliance on the heading of that Resolution, namely,

'Cement :

Re-Organisation of the system of distribution of---',

in urging that the word 'cement would include ad hoc allotments. There are several varieties of cement, to wit, Portland pozzolana cement, blast furnace slag cement, hydrophobia or waterproof cement, rapid-hardening cement, low heat cement, masonry cement, grey cement, oil-well cement and so forth. The word 'cement' in the heading of the Government Resolution dated 12th September, 1978, embraces not the different heads of allotments like quarterly and ad hoc but the different varieties of cement, all of which must be distributed on the guidelines laid down therein. Read by itself and as a whole, Government Resolution dated 12th September, 1978 lays down the guidelines for the distribution of regular quarterly allotments of cement of whatsoever variety without drawing into its fold distribution of ad hoc allotments. There is specific reference to the receipt by the State Government of quarterly allotments and to a temporary phase of receiving some additional quantity of cement, not by way of ad hoc allotments from the Central Government, but from factories in Karnataka by way of barter for electricity supplied by the State Government. Thereafter come the guidelines for the distribution of cement. The generality of the heading of the Government Resolution must necessarily be read as being confined to the re-organisation of the system of distribution of cement in its different varieties on the guidelines laid down in that Resolution and not as being inclusive of ad hoc allotments. No mention is made of ad hoc quotas allotted by the Central Government. If the Government Resolution had been intended to include ad hoc allotments also, it would certainly have so provided, more so in view of the fact that prior to this Resolution, not less than 3 ad hoc allotments had been made by the Centre between July 1977 and March 1978, aggregating to 16,16,650 tonnes. Read by itself and as a whole, Government Resolution dated 12th September, 1978 does not apply to ad hoc allotments, nor was it intended to, until it was specifically made applicable by Government Circular dated 31st March, 1981 read with Government Circular dated 2nd March, 1981. As long as Government Circular dated 31st March, 1981 is in force, it must be acted upon and, unless any allotment is earmarked for a particular purpose by the Central Government or any condition is attached by the Central Government, distribution of ad hoc allocations must be done in accordance with the law and in the light of that Circular, read with Government Circular dated 2nd March, 1981 and on the guidelines laid down in Government Resolution dated 12th September, 1978.

13. The stand taken up by the State Government that the Circular dated 31st March, 1981 was issued under a mistake and misunderstanding, has nothing to commend itself. This hypothesis of mistake and misunderstanding is sought to be attributed to the under Secretary Mr. Syed Yakoob, Mr. Tipnis, the Deputy Secretary, and Mr. Chari, the Secretary to Government, in their purported failure to appreciate that the doubt about the decision of the High Level Committee in its meeting of 4th March, 1981 was resolved in the meeting held on 31st March, 1981, reaffirming an earlier decision of the meeting of 2nd March, 1981. Reliance was placed by Mr. Sen on the minutes of the meetings of the High Level Committee held on 2nd March ,1981, 4th March 1981, and 31st March 1981. In order to appreciate the significance of these minutes, a brief narration of the events is necessary.

14. On 16th August 1980, the Department of Food and Civil Supplies set up a small Committee at State Level in order to Systematise the allotment of cement from the Central Government. The Minister of State for Civil Supplies was the Chairman and the Secretary and Joint Secretary were the other member of this Committee. This Committee was to scrutinise the applications for ad hoc allotments and make its recommendations to the Minister for Food and Civil Supplies for his final approval. The State Level Committee functioned till 28th February, 1981 when the State Government set up a High Level Committee consisting of the Minister, Food and Civil Supplies Department as Chairman, various other Ministers and officials as members including Mr. Chari as the Member-Secretary. The purpose of setting up this committee was to monitor, guide and review the distribution of cement among the development departments and needy institutions and individuals in accordance with the approved priorities and ensure that the departments, institutions and individuals utilised the cement allotted to them for the purpose allotted. This High Level Committee was intended to assist and advise the State Government in regard to allocations both against the regular quarterly quota as also the ad hoc allotments made by the Central Government. At its meeting held on 28th February, 1981, the High Level Committee made certain recommendation not germane to the subject matter in hand. The second meeting was held on 1st March, 1981. The relevant excerpts of the minutes are as under :---

'Minister (Food and & Civil Supplies) explained to the committee the procedure being followed in regard to allotment of cement by the department. Minister (Food and Civil Supplies) observed that the regular quarterly allotment is distributed by the department between all the departments of the Government and the districts including Greater Bombay. There is no direct allotment to parties from Food & Civil Supplies Department in respect of regular allotment. In respect of ad hoc allotments it has been found advantageous to issue allotment order from the department. Ad hoc allotments form only a small proportion of the total allotment of the State. Minister (Food & Civil Supplies) then explained that the State Level Committee of the Department had finalised certain allotments recently, but orders are yet to issue. Minister (Food & Civil Supplies) desired to know the view of the High Level Committee as to whether the allotment orders may issue. The High Level Committee decided that a meeting may be called on 2nd March, 1981 at 4 p.m. to review the allotments finalised by the High Level Committee.'

In its meeting held on 2nd March, 1981, the High Level Committee decided that with regard to ad hoc allotments, normally no applications should be entertained by Mantralaya and applications received earlier should be sent to the respective Collector/Controller of Rationing for necessary action and that the Collectors should submit to Government their recommendations for allocations upto 1,000 M.T. and the Controller of Rationing, Bombay, upto 4,000 M.T. As a result of this decision, pending applications were sent to the District Collectors and Controller of Rationing by the Department of Food and Civil Supplies. Mr. Chari understood these recommendations of the High Level Committee to mean a direction that all pending applications should be sent to the Collectors/Deputy Controller of Rationing merely for their consideration and that it was never intended that they had to make allocations against ad hoc allotments. He further understood that whenever called upon those authorities would send their recommendations in respect of the applications against ad hoc allotments. He never understood the recommendations of the High Level Committee as meaning that the distribution of ad hoc allotments should be done in the manner laid down by the Government Resolution dated 12th September, 1978. Mr. Chari asserts that he is informed by Mr. Syed Yakoob that he too understood this in the same way. Mr. Chari goes on to say that if the Government Circular dated 31st March, 1981 conveys the impression as if distribution or allotment of cement should be made in the manner laid down by the Government Resolution dated 12th September, 1978, then the language of the Circular dated 31st March, 1981 is inappropriate and clearly wrong.

15. On 4th March, 1981, the High Level Committee held a meeting where Mr. Chari as Member-Secretary, was present. The minutes of that meeting were prepared by Mr. Chari as was fairly conceded by Mr. Sen. The correctness of those minutes is not in dispute. The relevant excerpt of those minutes reads thus :

'The committee decided that case of individuals/institutions/builders shall not be placed before the committee for consideration. Such cases shall be decided by the Taluka Committee and in Bombay by the Regional Committees.' The underlining is mind)

16. On 31st March, 1981, the High Level Committee held a meeting. Mr. Chari was present at that meeting. Item 2 of the agenda was to report to the committee action taken on the decision of the High Level Committee in its earlier meeting. The relevant excerpts of the report on the action taken on the decisions taken in its earlier meeting of 4th March, 1981 pertaining to Item 2 of the agenda reads as under :---

'Decision of the committee. Action taken

x x x x x

8. Pending applications for Sorting out

cement to be refereed back applications

to local/Taluka Level/City districtwise and

Level/Regional Level Cement preparing lists

Distribution Committee to be of applicants is

decided by them in progress'.

Items 3 and 4 of the agenda read as under :---

'(3) To inform to the Committee the allotments of cement made in some emergent cases after the last meeting of the committee (Note appended)'.

'(4) To place before the Committee the list of emergent cases received after 1st March, 1981 (Note appended)'.

The note appended to Item 3 stated inter alia.---

'In response to the instructions received from Chief Minister, cement was required to be allotted immediately in certain cases. The total quantity required for issue of cement in these cases worked out to 3570 M.T. It was considered advisable to allot the cement to concerned parties in suitable instalments. Hence orders allotting the first instalment have been issued. The quantity involved in such allotment is 1320 M.T.'

The relevant excerpt of the note appended to Item 4 reads as under :---

'2. In the meeting held on 4th March, 1981, the Committee decided that the cases of individuals/institutions/builders should not be placed before the Committee for consideration and such cases should be decided by the Taluka/Regional/City Level Committee.'

'4. (Sic.) Since the formation of the Committee, some applications have been received in the department for submission before the Committee, accordingly all such applications received after 1st March, 1981, have been listed chronologically and the list is appended herewith.

'4. At present no ad hoc quota is available. Till now the regular quarterly quota which we receive from the Government of India......is distributed to different departments for being distributed further to various Government and semi Government Organisations under their control and to the Collectors and the Controller of Rationing for public sale through the Taluka/Regional/City Level Committees. In view of the decision taken by the Committee on 4th March, 1981, it will be necessary for the committee to decide whether decision taken earlier should be revised'.

The relevant excerpts of the minutes of the meeting of 31st March, 1981 are as under :---

'9. In regard to Item No. 3 of the agenda the Committee reiterated its earlier decision that no applications should, normally, be entertained in Mantralaya and that any application for cement received in Mantralaya including those received earlier and pending in the Deptt. should be sent to the respective Collectors and Controller of Rationing, Bombay, for necessary action.'

'10. For want of time the Committee could not consider Item Nos. 1, 2 and 3 on the agenda'.

It is not in dispute that these minutes were prepared by Mr. Chari who as Member-Secretary was present at the meeting. In Clause 9 of the minutes, the first sentence, viz. 'In regard to Item No. 3 of the agenda', is written in ink by Mr. Chari. This is admitted by Mr. Sen. The last sentence originally appearing in that clause read thus---

'This disposed of Item No. 4 of the agenda.' This sentence is in the handwriting of Mr. Chari and is deleted in ink by Mr. Chari. This is also admitted by Mr. Sen. In Clause 10 of the minutes the figure '4' has been changed to the figure '3' in ink by Mr. Chari. This too is admitted by Mr. Sen.

17. It was urged by Mr. Sen that it was an error or oversight on the part of Mr. Chari to have added the first sentence in Clause 9 and that Clause 9 as it originally stood without the addition of the first sentence was correct and further that it was also through mistake or oversight that Mr. Chari deleted the last sentence after correctly writing it out in ink at the end of Clause 9. According to Mr. Sen, Mr. Chari did so as it was redundant in the context of Clause 9 itself. Pausing here for a moment, this explanation assailed by Mr. Sen, albeit on instructions, is not to be found in any of the lengthy affidavits filed on behalf of the State Government. Even Mr. Chari is silent about the additions, interpolation and deletion made by him, as fairly conceded by Mr. Sen. Surely Mr. Chari would have been the best person in a position and pre-eminently able to give the explanation offered by Mr. Sen across the Bar. However, Mr. Chari has chosen to maintain a stoic silence and perhaps discreetly so. When I pointedly brought this to Mr. Sen's attention, his explanation was that Mr. Chari could not do so as these minutes were produced before me in Court on 18th December, 1981 during the course of arguments. I am afraid this is an utterly weak explanation to explain away the inexplicable. To start with, these minutes which indisputably were throughout in the custody of the State Government, were not produced at the admission stage, through lengthy and detailed arguments were advanced for some days to oppose admission of this petition. Though Mr. Chari has referred to these minutes in his affidavit dated 21st November, 1981, he has made not the slightest attempt to give any explanation now assailed by Mr. Sen on instructions. He has not even stated that any corrections or alterations were made by him in these minutes, or when they were made, much less why. Mr. Chari could in his affidavit dated 21st November, 1981 have clarified all this. He also had later opportunities to do so, but did not. The petitioners had even protested in correspondence that several documents of which inspection was given had been tampered with. This protest was reiterated before me by Mr. Desai in the course of his arguments. Thus at my request the original minutes were produced before me by Mr. Sen on 18th December, 1981, when after scrutinising them Mr. Sen offered his explanations on instructions. Thereafter the matter proceeded before me for several days. Yet no explanation was forthcoming from Mr. Chari himself. Nothing prevented him from making yet another affidavit. As it is, he has made three, and one more surely would not have over-burdened the record. Even during the course of these proceedings, the State filed affidavits, including Mr. Chari's. Despite that, on this aspect no explanation was forthcoming from the person best in a position to give one, namely, Mr. Chari himself. No explanation was forthcoming for this omission. Instead the onerous task was placed on the shoulders of Mr. Sen to advance an explanation which can be no better than an ipse dixit. These minutes are not exactly calculated to inspire any confidence.

18. It was urged by Mr. Sen that the penultimate para of the minutes of 4th March, 1981 dealt with cases of individuals, institutions and builders being considered by the Taluka Committees in the districts and the Regional Committee in Bombay and it was this para which created a misunderstanding in the minds of Mr. Syed Yakoob, Mr. Tipnis and Mr. Chari. This is a myth. What was decided at the meeting of 4th March, 1981 was not that such cases shall merely be considered by the Taluka/Regional Committees, but that such cases shall be decided by them. So was it minted in language explicit and unambiguous. This decision taken by the Committee is also reflected in a note appended in respect of Item 2 of the agenda of the Committee's meeting on 31st March, 1981 where it has been also stated that the sorting out of the applications districtwise and preparation of the lists of the applicants is in progress. Thus where arises any question of any misunderstanding arising in the minds of Mr. Syed Yakoob, Mr. Tipnis or Mr. Chari.

19. On 6th April, 1981, Mr. Tipnis addressed a letter to various Collectors in connection with the Circular dated 31st March, 1981. In this letter he stated that a large number of applications which were pending in the Food & Civil Supplies Department on which either the Committee decided not to issue any ad hoc quota or on which decision could not be taken by Government as mentioned in para 3 of the Circular dated 31st March, 1981, have been sorted out districtwise and that it was contemplated preparing lists of such applications before they were forwarded to the respective Collectors/Controller of Rationing, for further action. It was further stated that some of the applicants might have approached Government directly and as such as delay in forwarding those applications to the Regional/City/Taluka Committees would cause further delay and hardship to the applicants, hence Mr. Tipnis was sending a bunch of applications pertaining to the concerned district for distribution further to the Deputy Controller of Rationing/Tahsildar/Foodgrains Officers concerned, who should inform the applicants that the applications have been received back from Government and will be examined by the respective cement distribution committee. In his affidavit an attempt has been made by Mr. Tipnis to explain away this letter written by him. He says that neither he, nor Mr. Yakoob, under Secretary, who issued the Circular dated 31st March 1981, understood the recommendations of the Committee contained in the minutes of the Committee's meetings on 2nd, 4th and 31st March, 1981 to mean that ad hoc allotments should also be allocated in the same manner by going through the 3 stages of distribution stated by Mr. Chari in his affidavit and prescribed by the Resolution dated 12th September, 1978. Both he and Mr. Yakoob interpreted the Committees recommendations to mean that applications should be sent to the Taluka Level and Regional Level Committees for their advice in the same manner as they were doing for allocating to consumers in the third stage of the regular quarterly allotments. If however the Circular dated 31st March, 1981 conveys the impression that distribution of cement against ad hoc allotments should be done in the same manner enjoined in the Resolution dated 12th September, 1978, then the Circular would be clearly wrong and inappropriate, as ad hoc allotments cannot be distributed in the manner laid down in the Resolution dated 12th September, 1978 for the reasons mentioned in Mr. Chari's affidavit.

20. Mr. Chari has also ventured his explanation, viz. that Mr. Tipnis letter dated 6th April, 1981 did not mean that the Collectors and Controller were to deal with the applications against regular allotments on the basis of the three-stage distribution system envisaged by the Resolution dated 12th September, 1978, for the same could not be applied to the one-stage distribution against ad hoc allotments. Mr. Chari says that the Committee itself decided that the emergent cases for allotment of cement against ad hoc allotments made by the Central Government were to be decided by the Minister of Food and Civil Supplies Department, although the cases were referred to them for their recommendations. They could not have recommended that the Regional Committee for Bombay and the Taluka Level Committee in the districts should follow the three-stage of distribution applicable to the regular quarterly allotments envisaged under the Resolution dated 12th September, 1978 also for allocation against the ad hoc allotments. The Committee at its meeting of 2nd March, 1981 only recommended that applications should be sent to the Collectors and the Controller of Rationing for their recommendations and they never recommended that the one-stage distribution to the consumers directly against ad hoc allotments were to be dealt with by the Regional and Taluka Committees in accordance with the procedure for distribution as laid down by the Resolution of 12th September, 1978. They were recommended that the distribution done by the State Government with regard to ad hoc allotments was to be taken over by the Regional and Taluka Committees and that the entire work was to be done by following the three-stage distribution envisaged by the Resolution dated 12th September, 1978 for allocation to consumers. The State Government throughout maintained its control and function in the matter of distribution of cement against ad hoc allotments as also in respect of the regular quarterly allotments, subject to the procedure envisaged in the Resolution dated 12th September, 1978 in the case of the latter. The Taluka Level Committees and the Regional Committees were set up only to advise on the work of distribution against regular allotments. With regard to the distribution against ad hoc allotments, the State Government retained control throughout and though the State Level Committee and later the High Level Committee made certain recommendations with regard to individual cases also, the actual allocation in each case was made by the State through the Department of Food and Civil Supplies from Manatralaya by issuing orders of allotments in favour of individual consumers and not by issuing individual permits as in the case of distribution of the regular quarterly quota. Even in regard to cases recommended by the Committee for allocation against ad hoc allotment, final allotment orders were made by the State in the Department of Food & Civil Supplies Department from Mantralaya. According to Mr. Chari, the Circular dated 31st March, 1981 was issued by Mr. Syed Yakoob through a misconception and misreading of the recommendation of the Committee as contained in the minutes of its meeting held on 2nd March, 1981, 4th March, 1981 and 31st March, 1981. According to Mr. Chari, Mr. Syed Yakoob purported to interpret this recommendation of the High Level Committee at its meeting of 2nd March, 1981 and reiterated on 31st March, 1981, in a manner so as to suggest that the Committee had recommended that the allocation to the consumer against the ad hoc allotments which was a one-stage process, was also to be done in the same manner as the distribution of the regular allotments of quarterly quotas to the public in accordance with the Government Resolution dated 12th September, 1978 which involved a three-stage process. Mr. Chari explains that based on a wrong interpretation of the said recommendation of the Committee, Mr. Syed Yakoob issued the Circular dated 31st March, 1981, thinking that the Committee had recommended that the entire work of one-stage distribution to the consumers from the ad hoc allotments was to be done by the Regional Committee in the Bombay Region and the Taluka Committees in the districts exclusively in accordance with the procedure envisaged by the Government Resolution of 12th September, 1978. The fact was that the Committee was only dealing with making recommendations concerning part of the work of distribution against ad hoc allotments and the State Government was throughout discharging its functions of distribution against ad hoc allotments ever since the ad hoc allotments started from 1978. Mr. Chari adds that he is informed that Mr. Syed Yakoob was under a misconception when he issued the Circular dated 31st March, 1981.

21. The Hon'ble Minister of State, Mr. D.S. Kamale, and a member of the High Level Committee echoes the sentiments of Mr. Chari and adds that in issuing the Circular dated 31st March, 1981, Mr. Syed Yakoob misunderstood the minutes of the meetings held on 2nd March, 1981 and 4th March, 1981. The State Government never decided that all pending applications should be considered by the Taluka/Regional Committees in accordance with the Government Resolution dated 12th September, 1978. Despite Mr. Tipnis letter dated 6th April, 1981 to the Collectors and Controller of Rationing, no recommendations were received from them, with the result that the State Government in the Department of Food and Civil Supplies received applications for ad hoc allotment and continued to issue allocation orders against ad hoc allotments. It is not stated from what point of time. However, Mr. Sen stated it was from 21st April, 1981 and without any formal decision taken in that behalf.

22. What is not without its own significance is that both Mr. Chari and Mr. Kamale have chosen to slur over the minutes of the meeting held on 4th March, 1981 which in unmistakable terms reflect the Committee's unequivocal decision that cases of individual/institutions/builders shall not be placed before the Committee for consideration and that such cases shall be decided by the Taluka Committee/Regional Committee. It is difficult to see what mistake or misunderstanding could possibly arise out of this decision taken without reservation and minuted with exactitude. It is manifest that this decision over-rules the Committee's earlier decision of 2nd March, 1981 of sending applications to Collectors/Controller of Rationing for their recommendations. There could possibly be no question of any doubt being entertained by any one as to what was decided by the Committee on 4th March, 1981. It is clear and explicit. In the light thereof, where arises the question of resolving any doubt as purported to have been done in the Committee's meeting of 31st March, 1981 the correctness of the minutes whereof are highly suspect, bristle as they do with additions, alterations and interpolations. In the light of this clear-cut and categorical decision taken at the meeting on 4th March, 1981, harping on the Committee's recommendations in the meeting of 2nd March, 1981 can possibly have no useful purpose except to lay a red bearing, cloud the issue and make a belated basis for mistake and misunderstanding for which there can be no possible foundation except to willy-nilly to circumvent the Government Circular dated 31st March, 1981 issued by Mr. Syed Yakoob by order and in the name of the Governor of Maharashtra.

23. This brings me to the most pitiable affidavit of the lot. And that is by Mr. Syed Yakoob. It makes pathetic reading. The only thing to commend it is that it is mercifully brief. Mr. Syed Yakoob says that after perusing a copy of the minutes of the meetings held on 2nd and 4th March, 1981, he issued the Circular dated 31st March, 1981. He thought that the Committee had possibly given directions that the allocation of cement to consumers against ad hoc allotment should also be carried out under the same procedure and in the same manner prescribed by the Resolution of 12th September, 1978. He did not at that time fully apply his mind into the matter as he should have done. After applying his mind to the relevant facts involving cement distribution against the regular quarterly allotments and those involving distribution of cement against ad hoc allotments and after perusing the minutes of the Committee, he now realises that the Circular dated 31st March, 1981 was not correct and in fact is misconceived. The statements made by Mr. Chari in his affidavit are based on the information and explanations given by him to Mr. Chari and that the said statements are correct.

24. Mr. Syed Yakoob's affidavit is supremely vague. It is vacuous in thought and abject in content and gives an uncomfortable feeling whether he too is being made a scapegoat.

25. Mr. Syed Yakoob, Mr. Chari, Mr. Tipnis and Mr. Kamale have chosen to observe a studied and discreet silence as to the point of time when realisation drowned on them that the Government Circular dated 31st March, 1981 was begotten in mistake and conceived in misunderstanding. This Government Circular was not a private document signed by Mr. Syed Yakoob in his personal capacity or some department note to lie forgotten in the morass of Mantralaya files. It was widely circulated. It was made public. It was intended to be acted upon. Even a notice was placed outside the Food and Civil Supplies Department, Mantralaya, that no applications would be received at Mantralaya. This notice remained displayed in any event till June 1981, if not later. No one has yet told me that this notice too was a 'mistake' and result of 'misunderstanding'. This Government Circular dated 31st March, 1981 was in fact acted upon, as in demonstrated by the reply dated as late as 3rd September, 1981 given by Mantralaya, Food and Civil Supplies Department, to an application dated 17th March, 1981 made by Bombay R.C.C. Grill Association to Mantralaya. The reply from Mantralaya says that after the applicants' letter dated 17th March, 1981, Government has---

'decided that henceforth no application for allotment of cement should be entertained at Mantralaya and that all the applicants desirous of applying for cement should approach the local cement distribution committees through the concerned Deputy Controller of Rationing for their requirement of cement as per normal procedure. In view of this position you are requested to approach the local cement distribution committee through the concerned Deputy Controller of Rationing, Bombay, accordingly for your requirement of cement.' Happily it was not urged that this letter from Mantralaya itself was also written under 'mistake' and 'misunderstanding'. When I put this query to Mr. Sen, he had the modesty to blush.'

26. What also militates against the hypothesis of 'mistake' and 'misunderstanding' is, why the 'mistake' and 'misunderstanding' were not sought to be rectified instead of being perpetuated and attempted to be justified in the guise of affidavits and arguments. No explanation was forthcoming.

27. There is not the slightest doubt in my mind that the hypothesis of 'mistake' and 'misunderstanding' now advanced at the hearing stage is a myth and a cover-up operation indulged in by the State Government in a belated attempt to extricate itself from its own Circular dated 31st March, 1981 after being confronted with it during the course of arguments at the admission stage. By then Mr. Tipnis had already made an affidavit opposing admission, but kept silent about this Circular. Even after being confronted with this Circular during arguments at the admission stage, significantly it did not strike either Mr. Tipnis or Mr. Chari or Mr. Syed Yakoob to apply for time to make an affidavit on the lines of mistake and misunderstanding. It did not even occur to them to instruct their own Counsel the learned Advocate General that the Circular dated 31st March, 1981 was the result of mistake and misunderstanding. Mr. Sen cannot blithely dismiss all this as a comedy of errors. It is neither. It is an after-thought, with Mr. Tipins, Mr. Chari and Mr. Syed Yakoob as willing or unwilling tools suppression having failed to achieve its purpose.

28. Perhaps the unkindest cut of all was the criticism levelled against the learned Advocate-General. During the admission stage of this petition, an admission was made by him that in the absence of any direction by the Central Government to the contrary, the Government Resolution dated 12th September, 1978 would also apply to ad hoc quotas in the light of the Circular dated 31st March, 1981. Mr. Desai categorically stated more than once that during the admission stage, Mr. Tipnis, Mr. Chari and Mr. Syed Yakoob were present when the learned Advocate-General made his statement. This was not contradicted by Mr. Sen. Yet Mr. Chari in his affidavit now has the temerity to state that when the learned Advocate-General made his statement to the Court, he did not have full instructions and was not aware of the Committee's recommendations of 2nd March, 1981 and 31st March, 1981 or that the Government Resolution could not apply to ad hoc allotments. Nothing could have been simpler for Mr. Chari, Mr. Tipnis and Mr. Syed Yakoob to have immediately told the learned Advocate-General then and there that the Circular dated 31st March, 1981 was issued under a mistake and misunderstanding as in now sought to be made out. They did nothing of the kind, nor is any explanation forthcoming why these 3 presumably responsible and highly-placed Officers did not. This is yet another factor which militates against the hypothesis of 'mistake' and 'misunderstanding' now trotted forth by Messrs Chari, Tipnis and company and demonstrates it as an after-thought. The statement made by the learned Advocate-General was in the highest traditions of the Bar which he leads. The criticism levelled against him was unwarranted. The attempt on the part of the State Government to mulct the learned Advocate-General cannot but be deplored.

29. In support of his contention that allotments were arbitrarily made to builders by the 2nd respondent or under his instructions, Mr. Desai relied on certain endorsements made by the 2nd respondent and the Officer on Special Duty Mr. Lulla on certain letters asking for allotments. It is nobody's case that Mr. Lulla made any endorsements on his own. On the other hand, it was urged by Mr. Sen that not a single allotment was made by the 2nd respondent or under his instructions and that endorsements made by the 2nd respondent on the application letter of certain builders were mere recommendation and not directives or others and were never intended to be so. Mr. Sen urged that the applications with endorsements made by the 2nd respondent and Mr. Lulla were forwarded to the Food and Civil Supplies Department for action and it was only rarely that full quantities asked for in the applications were given. These contentions of Mr. Sen were based on the affidavits filed by Mr. Chari, Mr. Kamale and the 2nd respondent himself.

30. The 2nd respondent says that the representations received by him daily on various aspects exceed a thousand in number and over 100 persons meet him daily with representations and submissions. On the representations made to him personally or such as are routed to him through official channels, he generally makes comments or suggestions on the basis of what he thinks fit and proper. These representations with his comments are then forwarded to the concerned departments for appropriate action. In many cases, senior officers, including the Officer on Special Duty, also receive representations from the public. These officers record their views on such representations and forward them to the appropriate departments. In many cases, files containing the 2nd respondent's commands or suggestions are sent back to him if the concerned department does not agree with the second respondent. On numerous occasions the 2nd respondent has even modified his views, suggestions or observations in deference to the opinion expressed by the concerned department. Requests and representations received by the 2nd respondent have necessarily to be processed and decided in accordance with the rules, regulations, practice and policies of the State Government. The 2nd respondent denies that any person by the name of Yusuf Patel was given any cement or received any cement through him as alleged in the petition. The remaining 9 builders mentioned in the petition had received cement from the previous Government also. Ad hoc allocations to these builders were made by the Department of Food & Civil Supplies on merit in accordance with the procedure in force without arbitrariness or quid pro quo. The system of making allocations since the present Government took charge in June 1980 is the same as followed the previous Government as it was found to be rational, fair and promoting the public interest of the State. Out of the builder-allotters referred to in the petition, only a few gave donations. However, the donations were given unconditionally, voluntarily and without any request emanating directly or indirectly from the 2nd respondent or on his behalf. He denies that there was any quid pro quo between the allotments and donations. Several builders made donations but did not received any cement. A vast majority of the allottees got allocations without making donations. The 2nd respondent repeatedly denies that any allotment was made by him. He asserts that he never allotted cement in large or any quantity whatsoever and reiterates that allocations were made by the State Government in the Food & Civil Supplies Department and that no cement was distributed under his personal instructions. There was no connection between the donations given by the Hiranandani concerns of builders and the allocations made to them. He treated all applications before him equally. He asserts that he has not allowed that fact of his being a Trustee of the Trusts to conflict with his duty as Chief Minister and the interest of the Trust. In any event, he did not distribute cement because all the relevant orders were passed by the concerned department.

31. Mr. Chari says that no quotas were allotted by the 2nd respondent himself. The 2nd respondent merely made recommendatory comments or otherwise on the applications directly made to him by various parties. Such comments cannot be regarded as allocation orders. All such applications with the 2nd respondent's comments were forwarded to the Department of Food & Civil Supplies to be dealt with by that department. Where the department found that allocation orders should be issued, it was done by the concerned officers. In a number of cases, the quantity recommended by the 2nd respondent was not allotted and a lesser quantity was allotted.

32. Mr. Kamale's affidavit is on the same lines as the 2nd respondent and Mr. Chari with a rider that in some cases, even the 2nd respondents' recommendations could not be accepted.

33. In order to ascertain whether the 2nd respondent's endorsements on the builders' applications were mere recommendations as urged by Mr. Sen or whether they were directives as urged by Mr. Desai, during the course of the hearing, I called for on a random selection some applications made by builders bearing endorsements made by the 2nd respondent and the Officer on Special Duty Mr. Lulla. I have tabulated this sample survey in sets A, B and C for reasons which will soon be evident.

---------------------------------------------------------------------------------------

No. Name of Builder Date of Quantity Endorsement of the

application applied for 2nd Respondent.

---------------------------------------------------------------------------------------

1. Daryanani (Indo 5-1-81 500 M.T. 'We should sanction

Saigon) them the requested

Constructions Pvt. Ltd. quota.'

2. Indo Saigon 5-1-81 500 M.T. 'We may accept this

Agency request.'

3. Veena Estate 12-1-81 1,000 M.T. 'We may give them.'

Pvt. Ltd.

4. Kedy Co-operative 19-3-81 40,000 Bags 'He may be allotted in

Housing Society. suitable reasonable

instalments.'

5. Navin Constructions 13-4-81 310 M.T. 'We may give them.'

6. Nahar Enterprises 23-4-81 250 M.T. 'I think they deserve

held.'

7. Hira Nagar 28-4-81 250 M.T. 'Pl. do help.'

Development

8. Hira Nagar 28-4-81 250 M.T. 'Can we not help them.'

Constructions

---------------------------------------------------------------------------------------

From the tone and tenor of these endorsements made by the 2nd respondent, it is not possible to come to a positive finding that they were orders or directives given by him for allocation of cement as urged by Mr. Desai. These endorsements are at best the 2nd respondent's opinions or recommendations. Couched in the language they are, these endorsements cannot with any certainly be categorised as orders or directives given by the 2nd respondent. But Mr. Desai says that even an opinion expressed or recommendation made by the 2nd respondent would be considered by the officers as a fiat emanating from the 2nd respondent. This is conjecture. On conjecture and speculative reasoning, I am not prepared attribute to officials universal servility which Mr. Desai invites me to do.

Endorsements of the Officer on Special Duty, Mr. Lulla.

-------------------------------------------------------------------------------

Name of Builder Date of Quantity Endorsement of

application applied for

Mr. Lulla

1 2 3 4

--------------------------------------------------------------------------------

1. Amir 1-4-81 1280 M.T. This is a weaker section

Constructions housing project started

in 1979.

'We may give them 400

tonnes on Kessoram. The

C.M. has approved'.

2. Olympic 22-5-81 250 M.T. '200 tonnes on Mancheral

Enterprises to be allotted.'

3. Olympic 24-5-81 250 M.T. '250 tonnes may be

Enterprises issued on Kessoram'.

4. Amrut 27-5-81 Not stated. 'This is a weaker section

Builders 5487 M.T. housing project.

required for '100 tonnes on kessoram.

15 buildings

for weaker 'The C.M. has approved.

section of

Society. Only

450 M.T.

received.

Labourers

starving for

want of work.

5. Satguru 3-6-81 200 M.T. '100 tonnes on Kessoram'.

Enterprises

6. Jaycee 4-6-81 200 M.T. '150 tonnes on Kessoram'.

Enterprises

7. M.R. 8-6-81 200 M.T. '150 tonnes on Mancheral'

Associates

8. Havenkores Real 16-6-81 450 M.T. 'The project is of 1979

Estate Pvt. Ltd. 'We may allot 100 tonnes

from Kessoram.'

9. Makers 22-6-81 2400 M.T. 'This is the only project in

Development @ 400 M.T. B.B.R. area not completed.

Services per month for

6 months. 'C.M. has agreed that

400 tonnes be allotted

from Kessoram.'

10. Bombay 23-6-81 500 M.T. '100 tonnes from

Builders kessoram'.

11. Havenkores Real 23-6-81 500 M.T. 'We may allot 150 tonnes

Estates Pvt. Ltd. from Kessoram.'

'C.M. has agreed'.

12. Aydyogik Shramik 24-6-81 250 M.T. 'This is a 1975 project

Kamgar Co-op (Residential of Industrial workers.

Housing Society. Flats, 33 sq. 'We may release 200

mts., Nahar tonnes from Kessoram.

Village, Mulund) 'The C.M. has approved'

13. Hiranandani 24-6-81 50 M.T. 'The C.M. has agreed

Enterprises. that 50 tonnes be allotted

to Kessoram'.

14. Huma Exhibitors 24-6-81 200 M.T. 'We may allot 50 tonnes

(Not builder) for cinema on Tilda.

at Hariyali 'C.M. has agreed'.

Village.

15. Conwood 25-6-81 1000, M.T. 'Two hundred tonnes

Construction per month to pl.'

Co. Pvt. Ltd. complete pending

application for

2,75,662 bags (Low

Cost Housing Project

of 4,880 tenements)

16. Asian 25-6-81 250 M.T. 'One hundred tonnes.'

Construction Co.

(Note : This allocation appears to have been granted on specific instructions from the

joint Cement Controller, New Delhi, vide letter dated 13th April, 1981 to

the Secretary, Food & Civil Supplies Department, Bombay.)

-------------------------------------------------------------------------------------

These endorsements made by the Officer on Special Duty Mr. Lulla, are a mixed bag. Mr. Lulla's endorsements at Serial Nos. 3 and 8 cannot with any certainty be categorised as orders or directives emanating from the 2nd respondent. They may legitimately be construed as reflecting the 2nd respondents opinion or recommendation. The same, however, cannot be said of the endorsements at Serial Nos. 1, 2, 4 to 7 and 10 to 16. I ignore the endorsement at Serial No. 9, because that allocation appears to have been made pursuant to specific instructions given by the Joint Cement Controller, New Delhi, to the Secretary, Food and Civil Supplies Department, Bombay. Notwithstanding the 2nd respondent's protestations to the contrary in his affidavit, Mr. Lulla's endorsements at Serial Nos. 1, 2, 4 to 7 and 10 to 16 unmistakably reflect orders and directives emanating from the 2nd responding for making the allotments. The approval/agreement of the 2nd respondent endorsed by Mr. Lulla at Serial Nos. 1, 4, and 11 to 14 clearly reflects the 2nd respondents decision and order not only to grant those allotments but also orders the particular quota from which the allotment must be made. The peremptory nature of the endorsements at Serial Nos. 2, 5, 6, 7, 10, 15 and 16 (despite the 'pl.' in Serial No. 15), also reflects nothing short of an order given by the 2nd respondent. Of course, no fault can be found with Mr. Lulla for making the endorsements. He merely carried out the 2nd respondent's orders, which Mr. Lulla was bound to do.

Endorsements of the 2nd respondent on applications called to by me at random:

-------------------------------------------------------------------------------------------

Name of Builder Date of Quantity Endorsement of the

application. applied for 2nd Respondent.

-------------------------------------------------------------------------------------------

1. Turab Ali Potia 7-4-81 1000 M.T. 'Out of Bombay quotapl.'

(Through

R.W. Gudal

Associates, Architechs).

2. ACME Enterprises 7-4-81 1000 M.T. 'Out of Bombay quotapl.'

(Through R.W. Gudal

Associates, Architechs).

3. Sterling 7-4-81 1000 M.T. 'Out of Bombay quotapl.'

Enterprises

(Through R.W. Gudal

Associates, Architechs).

4. Hiranandani 28-4-81 250 M.T. 'Pl. give them.'

Constructions Pvt.

Ltd.

5. Anupam Cons- 2-6-81 500 M.T. 'Out of Bombay quotapl.'

truction Co.

6. Amol Construction 2-6-81 500 M.T. 'Out of Bombay quotapl.'

Co.

7. M/s. Pukhraj & 2-6-81 300 M.T. 'Out of Bombay quotapl.'

Sons.

8. Century Builders 2-6-81 1000 M.T. 'Out of Bombay quotapl.'

9. Joshi Undated 3 505 Bags. 'Pl. allot Sd. 4/5'.

Constructions

-----------------------------------------------------------------------------------------

These endorsements made by the 2nd respondent unmistakably disclose the peremptory order for allotments. There is nothing in the tone and tenor of these endorsements to indicate an opinion or a recommendation. Even the particular quota from which the allotments must be made has been ordered by the 2nd respondent, leaving the department no choice or discretion in the matter. The explicitness of the tenor of the endorsements conveys the implicitness and exactitude with which they must be carried out.

34. Here it may be stated that during the admission stage, 5 builder's applications had been called for at random from 5 different files. These applications find a place at Serial No. 4 of Table 'A', Serial Nos. 9, 10 and 13 of Table 'B' and Serial No. 8 of Table 'C' hereinabove and have been commented upon by me just now. Hence no further comment is necessary.

35. Despite the protestations of Mr. Chari, Mr. Kamale and the 2nd respondent to the contrary, even this limited random survey unmistakably reveals that allotments to certain builders were ordered by the 2nd respondent himself. Mr. Chari, Mr. Kamale and the 2nd respondent have been less than frank when on oath they say otherwise. It was not necessary for the 2nd respondent to have himself written out or himself signed the formal allotment orders. As Chief Minister, that was not his function, nor was he expected to do so. That would be the minion duty of the official concerned. It is sufficient that the 2nd respondent ordered allocations, even though he may not have ordered each and every one of them, which in fact he did not Mr. Chari's version that lesser quantities were allotted than what was 'recommended' by the 2nd respondent or Mr. Kamale's version that in some cases the 2nd respondent's 'recommendations' could not be accepted, must remain in the nebulous sphere of an ipse dixit, with not an iota of documentary evidence produced before me to establish it.

36. What also is not without its own significance is the manner in which the allotment applications found their way to the 2nd respondent and the manner in which allotments were ordered by him. Both appear to be cavalier. The applications do not bear any inward number. They do not even appear to have been processed. The endorsements themselves do not suggest any guidelines having been followed or that any enquiries were even made to ascertain the correctness of the contents of the builders' applications, which appear to have been taken at face value. No attempt was made by Mr. Sen, and perhaps discreetly so, to suggest what guidelines, if any, had been followed before the 2nd respondent ordered the allotments. What obviously was followed was the rule of the thumb which can never be substituted for the rule of law. The latter is the surest safeguard against the arbitrariness and contrariness of the former. It is futile for Mr. Sen to harp on the allotments ordered by the 2nd respondent in favour or hospitals, medical practitioners, charitable and religious institutions, temples and other worthy causes. On what guidelines even those allotments were ordered, was not made manifest. In any event, howsoever pious be the thought behind those allocations, it cannot be a balancing or redeeming factor for the 2nd respondent ordering allotments on the builders' applications, not by the rule of the law but by the rule of thumb. The charge of arbitrariness against the 2nd respondent has been brought home.

37. Coming to the petitioner's grievance that allocations were made to builders as a quid pro quo for donations to the Trusts. Mr. Desai urged that the modus operandi, was that the donations would be made by the builders or by another concern with which they were connected or by their friends, relations and associates. He contended that this subterfuge also enabled the builders to lawfully circumvent the restriction placed by section 80-G of the Income Tax Act which exempts donations only to the extent of 10% of the gross income of the donor. Reliance was placed by Mr. Desai on a speech made by the 2nd respondent in the Assembly and on a speech made by him as appearing in a collection of his speeches in a publication called 'Antriche Bol'. Mr. Desai urged that these speeches showed that builders were invited by the 2nd respondent to make donations as a quid pro quo for allotments.

38. I shall take up Mr. Desai's last contention first and get it out of the way. Political speeches made by the 2nd respondent cannot be the basis of a final Judicial conclusion, to resort to the former in order to arrive at the latter would to my mind be impermissible. Assuming what Mr. Desai says is correct, if nexus between allotments and donations is not otherwise established, political speeches made by the 2nd respondent cannot be utilised to fill in the lacuna. Should however nexus be otherwise established, these political speeches become redundant. Thus looked at either way, I propose to ignore them.

39. The question that arises is, has this nexus fact been established by the petitioners On that aspect, various affidavits and counter-affidavits, have been filed. During the course of the hearing, Mr. Sen handed over to be a statement and a few days later an amended statement showing the allotments made and the donations received. Mr. Desai also handed over to be a statement of allotments and donations. Some items of the one were irreconcilable with the other. Therefore, instead of allowing myself to be inundated with conflicting statements, I requested Mr. Sen to tell me across the Bar the allotments made and the donations received. That he very kindly did. It is, therefore, unnecessary to dilate on the affidavits filed or the statements handed in by the parties. In the light of the statements made across the Bar on behalf of the 1st and 2nd respondents and the uncontroverted data urged by Mr. Desai, the admitted position is at (A) to (F) hereunder. What however was not admitted by Mr. Sen, has been specifically stated by me.

(A) M/s. Pearl Corporation, M/s. Orchids Corporation, M/s. Manali Corporation, M/s. Lotus Corporation, M/s. Queens Park, M/s. Cool Breeze Corporation, M/s. Bhagwandas and M/s. D.S. Raheja & Co., though having different names, are all controlled by members of the Raheja family and for convenience are referred to hereafter as 'the Raheja Group'. On 2nd July, 1981, M/s. Pearl Corporation, M/s. Orchids Corporation, M/s. Cool Breeze Corporation, M/s. Bhagwandas and M/s. D.S. Raheja & Co., were allotted 2,000, 1,500, 1,500, 1,500 and 1,500 bags of cement respectively. Ten M.T. are equivalent to 200 bags. It is no longer in dispute that Mrs. Shanti Raheja, Dr. B.S. Raheja, Deepak B. Raheja, Vijay R. Raheja, and Rajan B. Raheja, are all related to each other and in some capacity or other are connected with the concerns comprising the Raheja Group. It is also no longer in dispute that two days after allotment of the cement to the aforesaid concerns forming the Raheja Group, these persons made donations by cheque on the same day, viz. 4th July, 1981, of Rs. 10,000/-, Rs. 7,500/-, Rs. 10,000/-, Rs. 7,500/-, and Rs. 10,000/- respectively, aggregating to Rs. 45,000/-. Also on the same day, viz. 4th July, 1981, and two days after the cement allocation, B.S. Raheja and Mrs. Geeta Raheja also made donations by cheque of Rs. 7,500/- each, aggregating to Rs. 15,000/-. In addition, on the same day, viz. 4th July, 1981, Pearl Corporation, Manali Corporation, Cool Breeze Corporation, Lotus Corporation, Queens Park and D.S. Raheja and Co., also made donations by cheque of Rs. 20,000/-, Rs. 30,000/-, Rs. 20,000/-, Rs. 50,000/-, Rs. 40,000/-, and Rs. 35,000/-, respectively aggregating to Rs. 1,95,000/-. Thus on one day itself, viz. on 4th July, 1981 and two days after allocation of 8,000/- bags of cement to the Raheja concerns, the Raheja group and family members made a total donation of not less than Rs. 2,55,000/-. Towards the end of the hearing it was suggested by Mr. Desai that these donations aggregating to Rs. 2,55,000/- were all made on 13th July, 1981. Whether they were made on 4th July, 1981 or 13th July, 1981, makes not the slightest difference in the lights of the admitted position that these donations were made on one day itself. That the Raheja concerns and numerous family members should all have decided to become charity minded and make their donations on the same day and conveniently two days or at the latest within ten days after the large allotment, cannot be attributed to mere coincidence, more so in the absence of any affidavit forthcoming from any of these donors. That is not all. On 18th July, 1981, Sewaram Raheja Foundation made a donation by cheque of Rs. 2,80,000/- and another donation of Rs. 1,60,000/- on 25th July, 1981. Towards the end of the hearing, Mr. Desai suggested that the donation of Rs. 2,80,000/- was made not on 18th July, 1981 but on 25th July, 1981. That makes no difference in the light of the admitted position that these donations were made. Thus between 4th July, 1981 and 18th July, 1981 or latest 25th July, 1981, the Raheja made a total donation of Rs. 6,95,000/-. Once again no affidavit has been forthcoming from this foundation to explain such large donations. While no blame can be attached to anyone making donations to a cause he considers worthy, the inescapable inference in this case is that there is a nexus between allotments and donations made by the Raheja concerns and family members, and that one was a quid pro quo for the other.

(B) Shreemal Builders and Amrut Builders are sister concerns. They carry on business from the same address. Out of 5 partners in Amrut Builders, 4 are partners in Shreemal Builders. On 24th June, 1981 and 1st July, 1981, Amrut Builders were allotted 100 tonnes of cement on each occasion. No donation was given by Amrut Builders. However, 2 days after the second allotment its sister concern Shreemal Builders gave a donation of Rs. 1,00,000/- by cheque on 3rd July, 1981. On the same day, viz. 3rd July, 1981, 9 individuals paid Rs. 9,000/- each in the same branch of Dena Bank at the same time and withdrew 9 demand drafts of Rs. 9,000/- each. On the same day and same time as these 9 persons, two other persons paid Rs. 9,500/- each into the same branch of Dena Bank and withdrew a demand draft of Rs. 9,500/- each. All the 11 demand drafts were in chronological order of numbers, viz. 904847 to 904857 and were donated to the same Trust on the same day. While it is not admitted by Mr. Sen that these 11 persons had any connection with Shreemal Builders or Amrut Builders, it is admitted that on the same day the Trust did receive these donations from these 11 persons by 11 demand drafts in chronological order of numbers. This sudden outburst of generosity in these circumstances from 11 persons supposedly unconnected either with Shreemal Builders or Amrut Builders, making donations of the same amounts at the same time on the same day in the same branch of the same Bank, is more than mere coincidence. In the totality of events, it is not difficult to draw the irresistible inference that these amounts aggregating to Rs. 1,00,000/- donated by these 11 persons in these circumstances on 3rd July, 1981 as also the donation of Rs. 1,00,000/- by Shreemal Builders on the same day, had a connection with each other and had direct bearing on the allotment to its sister concern Amrut Builders a few days prior thereto. No affidavit has been forthcoming either from Shreemal Builders or Amrut Builders or any of these 11 persons in explanation. Even assuming these 11 persons were not connected with Amrut Builders or Shreemal Builders, the very fact that Shreemal Builders did donate Rs. 1,00,000/- on 3rd July, 1981 and its sister concern Amrut Builders did receive 100 tonnes on 24th June, 1981 and another 100 tonnes on 1st July, 1981 is by itself sufficient to show the proximity between the dates of allotments to Amrut Builders and the dates of donation by Shreemal Builders leading to the irresistible inference of quo pro quo between the one and the other. Nexus is established.

(C) N.L. Hiranandani, a partner of Hiranandani Builders, has chosen to make a charmingly vague affidavit admitting having made a donation to one of the Trust and having received an allotment. He however throws up his hands in horror at any suggestion that the one was a quid pro quo for the other. However, from the data furnished by Mr. Sen, the factual position is that the Hiranandani Group, which had 7 projects, was allotted 350 M.T. on 13th May, 1981, 350 M.T. on 20th June, 1981, and 300 M.T. on 2nd July, 1981, aggregating to 1000 M.T. against their application for 1,350 M.T. The first allotment of 350 M.T. is stated by Mr. Sen across the Bar not to have materialised. On 1st July, 1981 and 2nd July, 1981 the Hiranandani group was allotted 50 M.T. and 175 M.T. respectively, aggregating to 225 M.T. Mr. Sen says that the last two allotments were given in lieu of the first allotment of 350 M.T. Significantly however, though Hiranandani has made an affidavit, he does not say anything of the kind himself, nor do any of the officers of the 1st respondent. Be that as it may, nothing much need be made of that. However, it may be stated that the instructions given to Mr. Sen do not appear to be entirely accurate because from among the builders' applications I called for at random during the hearing. I came across yet another application dated 24th June, 1981 for 50 M.T. which was granted by the 2nd respondent as reflected by the endorsement made by Mr. Lulla. A DONATION was made of Rs. 30,000/- on 2nd June, 1981 and of Rs. 1,20,000/- on 4th July, 1981, aggregating to Rs. 1,50,000/-. Once again the proximity between the donations and allotments, and the quantity allotted and amount donated cannot but lead to the irresistible inference of quid pro quo between the one and the other. Nexus is established.

(D) Makers Development Services (P) Ltd. was allotted 500 tonnes on 23rd April, 1981, 20 tonnes on 4th May, 1981 and 400 tonnes on 23rd June, 1981, aggregating to 920 tonnes. Two days later Makers made a donation of Rs. 4,00,000/- to one Trust on 25th June, 1981 and a week later on 1st July, 1981 made a donation of Rs. 2,00,000/- to the other Trust. Though R.A. Maker has made an affidavit, he has not chosen to explain this sudden munificence and outburst of charity the very next day of the allotment of 400 tonnes and again a week later. He has contended himself by saying that the donations made to the Trust by his concern were voluntary without the element of quid pro quo creeping in and that even prior to June 1980, his concern had received allotments of cement from Mantralaya. This affidavit is charmingly vague and is the epitome of discretion, revealing less than it should. The proximity between the allotment and donations and the quantity allotted and amount donated, cannot but lead to the irresistible inference of quid pro quo between the one and the other. Nexus is established.

(E) Bombay Builders were allotted 100 tonnes on 24th June, 1981 and 100 tonnes on 1st July, 1981. During the course of arguments before me, Mr. Kanuga, the learned Government Pleader, made a statement that Bombay Builders gave a donation of Rs. 1,50,000/- on 23rd July, 1981. There however seems to be some reservation about this on the part of Mr. Sen. I shall, therefore, ignore this amount of Rs. 1,50,000/-. But that is not all. One Zakaria Aghadi is a partner in Bombay Builders. He is also the Chairman of Hanjer Educational Society and is the common link. He has made an affidavit that among several other charitable purposes towards which the society has made donations, it also made a donation to the Pratibha Pratisthan (he does not say how much or when) and a donation of Rs. 25,000/- to the Konkan Unnati Mitra Mandal by cheque on 19th June, 1981. However, Mr. Sawant, the learned Assistant Government Pleader, frankly stated that the society had made a donation of Rs. 1,50,000/- to the Pratibha Pratisthan on 23rd June, 1981 and a donation of Rs. 25,000/- to the other Trust on 25th June 1981. Incidentally, it may be stated that as appears from Aghadi's affidavit, the Society had never in the past made a donation as large as Rs. 1,50,000/- as it did in the instant case. It is patent that the society chaired by Zakaria Aghadi donated to the Trusts and Bombay Builders in which the same Zakaria Aghadi is a partner, was given the allocation of cement. Once again the proximity between the dates of the allocations the donations and the quantity allotted and the amount donated must necessarily lead to the irresistible inference of quid pro quo. Nexus is established.

(F) (i) Evershine Builders were allotted 300 M.T. on 2nd July, 1981 and 11 days later on 13th July, 1981, made a donation of Rs. 2,40,000/- to one of the Trusts, (ii) Prithvi Construction (P) Ltd. was allotted 20 M.T. on 4th May, 1981 and 200 M.T. on 2nd July, 1981, aggregating to 220 M.T. against 250 M.T. applied for, and within 11 days on 13th July, 1981 made a donation of Rs. 1,60,000/ to one of the Trusts. (iii) Ansa Builders were allotted 200 M.T. on 2nd July, 1981 against 250 M.T. applied for and 3 weeks later on 25th July, 1981 made a donation of Rs. 1,10,000/- to one of the trusts (iv) Olympic Enterprises were allotted 10 M.T. on 12th March, 1981, 20 M.T. on 2nd May, 1981, 200 M.T. on 24th June, 1981 and 250 M.T. on 24th June, 1981, aggregating to 480 M.T. The next day, viz. on 25th June, 1981, they made a donation of Rs. 1,00,000/-; (v) Satguru Enterprises were allotted 20 M.T. on 12th March, 1981, 50 M.T. on 20th May, 1981 and 100 M.T. on 24th June, 1981, aggregating to 170 M.T., within a week on 30th June, 1981, a donation of Rs. 25,000/- was made to one of the Trusts (vi) Navketan Builders were allotted 10 M.T. on 4th May 1981, 50 M.T. on 29th June, 1981 and 200 M.T. on 2nd July, 1981. Eleven days later on 13th July, 1981, they made a donation of Rs. 30,000/- to one of the Trusts (vii) N.R. Associates were allotted 20 M.T. on 12th March, 1981, 40 M.T. on 2nd May, 1981 and 150 M.T. on 24th June, 1981. The next day, viz. on 25th June, 1981, they donated Rs. 1,00,000/- to one of the Trusts; (viii) D.S. Raheja & Co., applied for 75 M.T. which were allotted on 2nd July, 1981. Eleven days later on 13th July, 1981, it made a donation of Rs. 35,000/- to one of the Trust. The case of these builders also unmistakably reveals the proximity between the allocations and donations and the quantities allotted and amounts donated, leading to the irresistible inference of quid pro quo. Once again nexus established.

40. Not being privy to the records of the Trusts, and not having been given the requisite inspection despite requests, the petitioners naturally cannot say whether donations were received from other builders as well and/or their, friends, relations and associates. Be that as it may, at least for the purpose of this petition, more than sufficient material has come to light which demonstrably establishes the petitioners' charge of quid pro quo and nexus between allotments and donations. For ready reference I have at the end of this judgment, on the data furnished by Mr. Sen himself, prepared an appendix giving in a tabulated form the particulars of allotments made to these 17 builders and the donations given. From that appendix emerges in the forefront that these 17 builders alone were allotted not less than 4560 tonnes of cement and that the donations aggregate to not less than Rs. 26,20,000/-, most of them being between a limited period of 23rd June, 1981 and 4th July, 1981. A glance at that appendix disclose nexus between allotments and donations and that one was the quid pro quo for the other. Whether the allotments preceded the donations or vice versa or whether on calculation of the quantities allotted and the amounts donated, the rate works out at Rs. 40/- and over per bag (as it does in some cases) or less (as it does in some cases), are factors which are irrelevant once nexus is established. In some instances the amounts donated are themselves eloquent from the point of view of the figures themselves, which on the face of it indicate some calculation on the basis of which such figures were arrived at as donations. For instance, donations in figures like Rs. 2,80,000/-, Rs. 1,60,000/-, Rs. 1,10,000/- and Rs. 2,40,000/- ipso facto indicate some calculation in arriving at these figures. These are unusual figures concerning donations, which in our culture embrace auspicious figures. One may legitimately ask why the unusual '80', '10', '40' or '60' Obviously, they are based on some calculation. If taken in conjunction with the allocation, these figures work out to about Rs. 40/- per bag. In some cases, the amount works out even to more than that and in some cases comparatively speaking, even to as little as Rs. 27.50 or even less per bag, presumably depending on the capacity of the builder to donate and the quantity allotted to him. The rate need not be uniform. What you lose on the swings you make up on the round abouts. Even if in a few cases the donations work out to Rs. 70/- and over per bag as urged by Mr. Sen, even so the builder would stand to gain as the price in the form of donations would even so be much cheaper than what the builder would have to pay in order to procure the same quantity in the black-market, which cannot be ignored because its existence may be uncomfortable to countence. Once nexus is established, mala fides must be the natural sequiter, and it cannot militate from the principle involved to say that from several other builders donations were received but no allocation was made. And the principle involved is that there can be no quid pro quo in allotment of an essential commodity, however, laudable the object of the charity donated to may be considered to be. It cannot be said in defence or mitigation that the donations were openly received by cheque and are accounted for by the Trusts or that they did not go into the pocket of the 2nd respondent himself. None of this would make any difference. It would even have made no difference had the 2nd respondent not been connected with these Trusts. That he is, makes it worse.

41. Mr. Sen attempted to defend the allotments made to these builders on the ground that they had been allotted cement by the previous Government also. That is no defence. Where lies the distinction is that it is nobody's case that allocations were then made as a quid pro quo for donations. Mr. Sen urged that non-builders like medical practitioners, private individuals, charitable institutions, hospitals, Co-operative Housing Societies and temples were allotted cement without their making donations. Surely that cannot be a justification for allotting cement to not less than 17 builders as a quid pro quo for donations. It is not necessary that there must be a quid pro quo for every allotment made. No one can be heard to off-set one grievous act against a dozen pious ones, except perhaps in the reckoning of the Almighty. But then that stage has not been reached. By the seemingly mundane rule of law governing a civilized community, it is sufficient for the purpose of this petition that nexus between allotments and donations has been established in not less than 17 instances of builders. I agree with Mr. Sen when he says that it would be absurd to suggest that India Hotels Ltd. which made a tremendous profit running into several corers of rupees, gave a donation of an amount as large as Rs. 26 lack in March-April 1981 just to get a miserable allotment of 100 M.T. on 21st April, 1981. It stands to reason and common sense that in such a case there can possibly be no nexus between allotments and donation, which however is otherwise in the case of the builders instanced earlier.

42. Mr. Sen says the builders were given allocations so as to enable them to complete their projects in hand so that the poor and the underprivileged for whom they were constructing, would not suffer. Not a single builder has ventured forth to express this admirable sentiment on affidavit.

43. Mr. Sen says that several builders had donated to other charities as well, so why not to these Trusts. And why not indeed; however, one quid pro quo is established, donations to other charities can be no answer or excuse.

44. Mr. Sen says that the donations made by these builders were voluntary without any suggestion made by anyone that allotments would be impeded which the builders had to prevent by making donations. This some-what strained contention does not cater to the tremendous shortage of cement which willy-nilly had to be procured by the expedient of allotments for donations or vice versa.

45. Mr. Sen says that the tax exemptions enjoyed by the Trusts was a potent factor for attracting donations by persons with surplus income liable to taxation, with the result that it was in the interest of the donors themselves to make generous donations to the Trusts. Significantly enough, not a single builder has himself come forward with this explanation. The result is genius in its very simplicity-the donors got the exemption, the Trusts got the donations and the builders got the cement.

46. Mr. Sen says that the hypothesis of a quid pro quo must stand negatived from the fact that a larger quantity was allotted to the public sector and to the districts, thereby reducing the proportionate allotment to the builders from 35% to 28% and increasing the number of builder-allotters from 893 to 1894 between July 1980 and September 1981. According to Mr. Sen, out of the total ad hoc allotments of 2,63,000 M.T., 73,000 M.T. were distributed among 1894 builders out of whom only an insignificant number have made donations. I fail to see how the quid pro quo established by the petitioners can be said to be negatived from these circumstances, assuming they are correct. However, this seemingly rosy picture attains a less colourful hue from the affidavit of Mr. Tipnis himself. From 1st July, 1980 onwards the total quantity allotted by the Central Government was 2,63,000 M.T. The quantity allotted to the districts was 46,350 M.T., Government and Semi-Government departments were allotted 71,500 M.T., Co-operative Hosing Societies, Educational institutions and individuals were allotted 48,819 M.T. and builders were allotted 73,270 M.T. Thus builders got more than even Government and Semi-Government departments and in comparison with the other categories, got the lion's share. During this period 1st July, 1980 onwards, the break-up of 23,061 M.T. (which includes 10,000 M.T. which has not materialised) is not available with the State Government. The State Government has admitted that between June 1980 and December 1980, 8 builders viz. Majethia, Century Builders, Maker, Amir, Nahar, Hiranandani, Raheja and Rizvi were allotted 400, 30, 550, 270, 480, 30, 1050 and 710 M.T., aggregating to 3520 M.T. from Mantralaya and that between 1st January, 1981 and 31st July, 1981 the same builders and Bombay Builders were allotted from Mantralaya 2400, 1000, 1300, 500, 1225, 580, 1240, 210 and 130 M.T., aggregating to 8585 M.T. Thus during these periods these builders received an aggregate of 12,105 M.T. which works out to an average of 1345 M.T. per builder for a period of one year and 953 M.T. per builder even during the 6 month period of 1981. In addition, they received from the Regional Level Cement Committee 845, 180, 3620, 710, 745, 30, 2855, 930 and 180 M.T., aggregating to 10,095 M.T. Between 20th June, 1981 and 1st July, 1981 the allotments from Mantralaya to builders aggregated to 10,410 M.T. and to Co-operative Housing Societies to 2910 M.T. This reveals that over 80% of the cement went to builders. Further more, once nexus between allotments and donations is established, the rest pales into insignificance.

47. I entirely agree with Mr. Sen when he says that suspicion can never take the place of proof and that proof has to be reasonable, leading to reasonable probability. However, in the instant case these salutary principles can have no application. The quid pro quo and nexus established between allotments and donations is far beyond the realm of mere suspicion. The nexus established is more than sufficient to render absence of bona fides reasonably probable. Proof to the hilt is not required Pannalal v. Union of India, : [1957]1SCR233 , followed in Barium Chemical's case, : [1967]1SCR898 and even a single allegation, if established can be so serious as to lead to an inference of mala fides, State of Haryana v. Rajendra Sareen A.I.R. 1975 Sc 1004.

48. I agree with Mr. Sen when he says that the State can take administrative decisions in matters of contract and other forms of largesse, public interest being the guiding factor. I also agree with Mr. Sen when he says that there is a presumption in favour of the validity of State action, the onus of proving invalidity resting on the challenger. Mr. Sen could not have enunciated principles more salutary and less appropriate in the facts established in this case. His reliance on the decision in M/s. Kasturi Lal Reddy v. State of Jammu & Kashmir, : [1980]3SCR1338 is misplaced. In that case, Government excluded certain blazes in in-accessibly areas from tapping and kept them out of the sections held by the State and allotted the same to a private party on the ground that it was impracticable to give them for tapping on wage contract basis. It was held that in these circumstances, the action of the Government could not be condemned as arbitrary or irrational. Mr. Sen relied on the following observations :---

'........there is always a presumption that the Governmental action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest. This burden is a heavy one and it has to be discharged to the satisfaction of the Court by proper and adequate material. The Court cannot lightly assume that the action taken by the Government is unreasonable or without public interest. But where it is so satisfied, it would be the plainest duty of the Court under the Constitution to invalidate the Governmental action. This is one of the most important functions of the Court and also one of the most essential for preservation of the rule of the law'.

No parallel can be drawn between that case and the present, where nexus between allotments and donations has unmistakably been established. It is impossible to hold that allotment of an essential commodity like cement for donation is reasonable or conducive to public interest. Arbitrariness and mala fides are writ large.

49. It was urged by Mr. Sen that the petitioners' charge of mala fides is disproved as they have made no grievance that builder-allotters have not utilised the cement against the approved demand or that their projects were bogus or that the quantities allotted were extravagant or that they were not bona fide builders. It was not necessary for the petitioners to establish any of these things. They had to establish that there was a nexus between allotments and donations and that one was the quid pro quo for the other. That they have done is ample measure.

50. This is not the case of one swallow making a summer as pictures query though somewhat inaccurately put by Mr. Sen. The numerous instance cited earlier reveal a set and consistent pattern between allotments and donations. The enthusiasm of the builders, their associates, friends and relations in making large donations, often in unusual figures, is heartwarming and be speaks a generous disposition in the noble cause of cement.

51. Mr. Sen queried the petitioners' locus on the ground that they are not in the category of builders and also on the ground that their claim for 5 bags each made against the regular quarterly allotment, was satisfied. Mr. Sen elaborated that only another builder could make a grievance of discrimination, which no builder has done I do not agree. On behalf of a certain Co-operative Housing Society, on 19th December, 1980 the 1st petitioner applied for a certain quantity of cement viz. 200 M.T. for the construction of a building for the weaker section of society. Along with 183 other societies who were each granted 200 M.T., the 1st petitioner too was allotted 20 M.T. This would perhaps draw him in the builder category. Even assuming it does not, and even though no builder has claimed to be discriminated against, the petitioners still have a locus to file this petition. The petitioners cannot be said to be meddlers or busybodies. They have taken upon themselves the task of litigating in a matter touching the rule of the law and probity in public life. Locus they certainly have.

52. I recapitulate my findings as under :---

(a) Read by itself and as a whole, Government Resolution dated 12th September, 1978 pertains to regular quarterly allotments only and not to ad hoc allotments received from the Central Government;

(b) Government Circular dated 31st March, 1981 is valid and binding;

(c) the hypothesis of mistake and misunderstanding advanced by the State Government in issuing the Government Circular dated 31st March, 1981 is rejected;

(d) the criticism levelled by the State Government against the learned Advocate General is unwarranted and the attempt to mulct him cannot but be deplored;

(e) As long as Government Circular dated 31st March, 1981 is in force, it must be acted upon and unless any allotment is earmarked for a particular purpose by the Central Government or any condition is attached thereto by the Central Government, distribution of ad hoc allotments must be in accordance with the law and in the light of Government Circular dated 31st March, 1981 read with Government Circular dated 2nd March, 1981 and on the guidelines laid down in Government Resolution dated 12th September, 1978;

(f) the version of the 1st and 2nd respondents that no allocations were made by the 2nd respondent, is rejected;

(g) the petitioners' charge of arbitrariness against the 2nd respondent in making allocations, is justified;

(h) nexus and quid pro quo between allotments made by the 2nd respondent in favour of certain builders and donations made by them directly or indirectly, is established;

(i) Once nexus and quid pro quo are manifest, mala fides on the part of the 2nd respondent must be the natural sequitor;

(j) the challenge to the petitioners' locus is repelled.

53. I pass the following order :---

Unless any allotment is earmarked for a particular purpose by the Central Government or any condition is attached thereto by the Central Government, the State Government is directed, as long as Government Circular dated 31st March, 1981 is in force, to distribute ad hoc allocations of cement in accordance with the law and in the light of the said Government Circular dated 31st March, 1981 read with Government Circular dated 2nd March, 1981 and the guidelines laid down in Government Resolution dated 12th September, 1978.

54. Petition is also allowed in terms of prayer (c)(ii) and (c)(iii) with the addition of the words, 'except as provided by the law' at the end of prayer (c)(ii).

Rule is made absolute accordingly.

55. On the question of costs, Mr. Desai submits that no fees whatsoever have been charged by any of the petitioner's Counsel or instructing attorney but that the petitioners have incurred-out-of-pocket expenses aggregating to Rs. 14,386/-. He applies that as a matter of principle these out-of-pocket expenses should be awarded to the petitioners. On the other hand, Mr. Sawant does not entirely agree with this figure suggested by Mr. Desai and suggests a figure of Rs. 3,000/- looking to the fact, inter alia, that despite 20 copies of the petition having been made by the petitioners, only two were furnished to the State Government. Taking all factors into consideration, I quantity a sum of Rs. 7,500/- which the State Government shall pay to the petitioners as costs of this petition.

56. Minutes of the meeting of 31st March, 1981 duly initialled in my presence by opposing Counsel and applications bearing the endorsements of the 2nd respondent and Mr. Lulla itemised in Tables 'A', 'B', and 'C' in para 33 of this judgment, and which applications have also been initialled in my presence by opposing Counsel shall remain in a sealed envelope with the Prothonotary and Senior Master until further orders.

Subject	Commercial
Court	Mumbai High Court
Decided On	Jan-12-1982
Case Number	Misc. Petition No. 1165 of 1981
Judge	B. Lentin, J.
Reported in	1982(1)BomCR367
Acts	Industries (Development and Regulation) Act, 1951 - Sections 3(1); Essential Commodities Act, 1955 - Sections 2; Maharashtra Cement (Licensing and Control) Order, 1973; Maharashtra Cement Control (Licensing and Control) (Amendment) Order, 1979
Appellant	P.B. Samant and ors.
Respondent	State of Maharashtra and ors.
Appellant Advocate	Ashok H. Desai, ; N.H. Seervai, ; R. Iyar and ; D.H. Nanavati, Advs.
Respondent Advocate	Ashok Sen, Advocate General of Mah., ; C.J. Sawant, ; S.P. Kanuga, ; B.A. Desai and ; Lalit Bhasin, Advs. for respondents 1 and 2, ; L.K. Chatterji and ; M.J.A. Patrawnala, Advs. for respondent No. 3

P.B. Samant and ors. Vs. State of Maharashtra and ors. - Court Judgment