Krishnan, J.
1. The respondents who run a business in foodgrains at a place called Khetia on the border of the Maharashtra State have been acquitted by the First Class Magistrate, Sendhwa, of the offence of contravening one of the provisions of the Madhya Pradesh Foodgrain Dealers Licensing Order, punishable under Section 7 of the Essential Commodities Act of 1955. The contravention was their storing, in course of their business, 155 maunds of rice ore 16-2-1959 without a valid license. While finding the facts, as alleged by the prosecution, the learned Magistrate; held that the respondents were only guilty of 'haste and ignorance' and there was no mens rea; elsewhere he has suggested that the offence was only of 'technical, nature'. Accordingly he has acquitted them. In the State appeal it is pointed out that on the. facts themselves these appellants were liable to punishment especially because such contraventions' lead to extensive export to other States and sales at unconscionably high prices.
2. The Questions in this Court are, whether they were justified because they had already obtained a license under the Madhya Bharat Agricultural Produce Markets Act on 1952, which was valid on the date of the storage of the rice; further, whether the Court was right in acquitting simply by calling it a 'technical offence', or one without mens rea.
3. The facts are simple. Khetia is a municipal town and there is a market there constituted under the Madhya Bharat Agricultural Produce Markets Act 1952 (hereinafter called 'the Act of 1952'). That Act has nothing to do with the control over the supply, distribution and sale of essential commodities; it provides for the licensing of business in agricultural produce in the declared market areas. The respondents had been licensed under that Act. Theirs seems to be a family business run by the father and son, namely, Keshrimal and Jogilal jointly; but in the relevant transactions, it was Jogilal who was playing the active part and for the purpose of the criminal prosecution it would be convenient to treat him as the only person in charge of the business.
4. The Madhya, Pradesh Foodgrain Dealers Licensing Order was made under Section 3 of the Essential Commodities Act (10 of 1955) for the purpose of centrolling business in foodgrain anywhere in the Madhya Pradesh. Every person who wants to do business in foodgrain should, from the date of the commencement of the order which was the 23rd October, 1958, obtain a license from the licensing authority. If anybody carries on the business of a dealer of foodgrain without a valid license he would be liable to punishment under the general penal Section 7, the maximum punishment being three years' imprisonment and a fine imprisonment is mandatory, except where the Court records reasons why a fine alone would meet the ends of justice. Dealing in foodgrain has been defined and there is a provision that anybody who stores foodgrain in a quantity more than 100 maunds would, unless he proves the contrary, be presumed to be storing it for the purpose of sate, which straightway would make him a dealer.
5. The respondents had applied for a license on the 29th January, 1959 though they seem to have purchased the appropriate stamp sometime before. This application was under consideration, and the license was issued to them about three months later. In that application itself it was clearly stated that there was no stock of rice; but on the 16th February, the Naib Tehsildar paid a visit to Khetia because he had got information that a few days before it, the respondents had brought to their godown a truckload, of 155 maunds of rice, which, so the information went, was to be exported to a neighbouring State without appropriate license or sanction. The information is of course not evidence, but it was introductory to the Tehsildar's conduct. When he went and called upon the respondents to explain, respondent Jogilal appeared and gave a written statement that a few days before it, the rice had come and a quantity of 150 maunds were with him. He added :
'We have not sold them yet and we intend to do so after obtaining the license according to law when we shall inform you of the particulars of the sale'.
The point to note here is that this was not a piece of information conveyed to the authorities spontaneously, but one given as an explanation when the Naib Tehsildar went for inspection and actually confronted the respondent. The stock was checked and the quantity which is given as 155 and not 150 maunds was taken over (which is only a minor difference). Since on that date there was no license under the Madhya Pradesh Foodgrains Control Order, the respondents were prosecuted under Section 3 of the Act with the results already mentioned.
6. The defence inter alia was of having been coerced to give the admission; here, however, the stand is on the statement itself. Any way, it is admitted that therewas the stock on the 16th February. It was not thereon the date on which the license was applied for and hadcome sometime before the 16th; obviously it was insecrecy, because the Tehsildar has pointed out, withoutcontradiction, that there was no reference to the arrivalof the truckload in the octroi books of the municipality.Howsoever it was brought, the stock was there certainlyfor the purpose of sale, which even without the respondent's statement, has to be presumed. No doubt the respondent Jogilal stated that he would sell it later on, butit was a statement made not of his own accord directlyto the authorities but when he was confronted with thestock and asked to explain.
7. The first point raised here is that the respondents are not dealers at ail, because a dealer is one who actually sells, and in any view of the matter they were not actually doing so at or about the time the stock was seized. This argument is fallacious; a dealer is one who sells and buys; but he need not be actually selling it every moment. Here the storage was for the purpose of selling which may be immediate or deferred.
8. The most seriously urged argument, which has been made for the first time here is that the respondents were already holding a valid license. There was a law in force in this area from before the enactment of the Essential Commodities Act (10 of 1955); that was the Madhya Bharat Agricultural Produce Markets Act of 1952. This Act, it is urged, has been repealed by the operation of Section 16 of the Essential Commodities Act; but under Sub-section (2) all appointments made, licenses and permits granted under the repealed Act will continue to be in force unless and until they are superseded. Since the respondents had bean licensed under that Act and that license was valid till the 31st March, 1959, it is seriously argued that they are not affected by the absence at the relevant time of a license under the new Order. This argument overlooks two important features; the first fatal to it. The Madhya Bharat Act of 1952 is not one that is covered by Section 16 of the Essential Commodities Act. For that it should be one controlling or authorizing the control of the production, supply and distribution of and trade and commerce in any essential commodity. The peculiarity of this repealing section is it does not set cut expressly the Parliamentary or the State enactments that were sought to be repealed, but describes them as a class. This was probably because different States had different laws on that subject and it was difficult to make an exhaustive list within a short time. But that does not in the least alter the position that only the laws dealing with this subject stand repealed; if such a law stood repealed, then appointments, licenses and permits under it would continue, all the same, till superseded by similar appointments, licenses, and permits under the new Act. But the Madhya Bharat Act has altogether nothing to do with this subject.
As already mentioned in the beginning, it only provides for licenses enabling a dealer in agricultural produce to do business in a particular market area constituted under that Act. Thus, that Act has not been repealed by Section 16 of the Essential Commodities Act, nor can license issued under that Act take place of a license under the Madhya Pradesh Foodgrains Control Order made under Section 3 of the Essential Commodities Act. The second question is, whether in the event of our really dealing with an Acton the same subject, the promulgation of the said Order, in October 1958 would not supersede the older licenses. But since the old enactment is not on the same subject, it is unnecessary in the instant case to examine that question. Thus, the respondents' having been, licensed under the said Madhya Bharat Act does not in any manner enable them to deal in essential commodities or food-grains without a license under the Madhya Pradesh Food-grains Control Order, 1958.
9. This takes us to the question whether the mere fact of the respondents having applied for a license does in any manner justify or extenuate their storing this quantity of foodgrain. Obviously, the mere fact of applying for a license is not equal to obtaining a license. For one thing, the license might not be granted; for another, there may be conditions; thirdly, the vigilance that the authorities exercise on the operation tinder license may start after its issue, white clandestine dealing before it is given night escape. The point to remember is that the obtaining of a license is not merely a ritual, but is something of considerable practical consequence; for one thing, the general reliability of the applicant for license and his amenability to the control of the authorities concerned is always a ground for the grant. In fact, by such an application the dealer is really lulling the authorities into a feeling that he is a straightforward person, and is not likely to do anything in that regard till he obtains it. exceptional circumstances might arise. For example, for reasons beyond his control the applicant might already have a stock. The obvious course for him is to mention it in his application. In the instant case, he recorded no stock. Another exceptional circumstance conceivable is where for unavoidable reasons the stock has come into his hands before the expected license has been issued. In that case again, he should either before or immediately after the arrival of the stock report to the licensing authorities 'of his own accord'.
In this case, the respondents did not do so. It was made to appear during the argument on behalf of the respondents at the bar that Jogilal had gone to the office of the licensing authority with the letter Ex. P/5 which has already been referred to. The fact was that when the Naib Tehsildar arrived at Khetia and called upon the respondents to state if they did not have a stock of about 150 maunds of rice, then and then alone, did Jogilal who is one of them, give this letter as an explanation. Certainly, a quantity like this could not be concealed; confronted with that difficulty, the respondent tried to make the best of it by saying that it was for sale and he proposed to sell it after obtaining the license. But storing for sale is itself dealing in the business and therefore this letter does not give him either the benefit of a justification or of extenuation. What the respondent seems to have done is to apply for a license and then store the foodgrain for sale on the off chance of escaping detection.
10. All this is found by the Magistrate himself; but he seems to have a notion that every offence should have what he calls 'mens rea', and without it even if it is apparently one covered by the definition of an offence, there could be no conviction. Without entering into any elaborate discussion about the principle of mens rea, we need only note that unlike in England we are in the field of criminal jurisprudence governed wholly by enacted law, and have nothing similar to common law offences. Most of the enactments expressly provide for the ingredients of guilty knowledge, bad faith and the like; when we are dealing with control provisions restricting the freedom of trade for the benefit of the public in general no occasion arises for discussion of mens rea at all. These laws are enacted because of the possibility of very considerable harm to the public in general, if people are allowed to store, distribute and sell essential commodities without the supervision and check enforced by the licensing authorities. Courts are not concerned with the propriety or ethics of this policy; but they have to note that while administering the control laws they are not called upon to discuss the mens rea, but to hold that if there is contravention, an offence has been committed. Nor is it pertinent to ascertain if the contravenor has really intended or stood to gain at the expense of the public by that particular act; he has violated the law meant to arrest tendencies which the Legislature considers most dangerous to public interest.
11. Another word which seems to be favourite with some of our Courts is 'technical'. In a general sense every offence is technical because it has in our country to be a breach of a statutory provision, using the word statute in a broad sense. But by that they usually seem to mean that there is nothing like moral turpitude in the breach concerned. Moral turpitude and mens rea sometime appear to be similar, but there is a basic difference. But we are not dealing with that aspect of the matter. To consider whether the offence involves moral turpitude is very easy when we are dealing with what might be called 'classical offences' like theft or murder which have throughout ages been disapproved and punished. On the other hand, control laws like the present one are comparatively modern, necessitated by the extended commerce and movements of essential commodities in the organized industrial societies of today. There may be quite a number of general public or even of Courts who are not able to visualize the moral significance of these control laws. To them pickpocketing of a rupee or two might seem an enormity because throughout ages people have been disapproving of it. And the breach of some control law by which foodgrain is imported or exported in the wrong direction and sold at unconscionably high prices seems to be 'technical' though in the ultimate analysis far more harm is done to society by such breaches. So the best for Courts in such cases is to avoid hazy notions such as the 'technicality' of breaches of control laws.
12. We would, therefore, allow the appeal and convict the respondent Jogilal under Section 7 of the Essential Commodities Act for the breach of the licensing provision in the Madhya Pradesh Foodgrains Control Order of 1958. At all stages connected with the storage of the rice Jogilal alone has been figuring and not his father Keshrimal. In the special circumstances, it would be proper to acquit Keshrimal. Coming to the sentence, imprisonment is mandatory unless special reasons are recorded. The purpose of selling the foodgrain has to be lead in the light of the fact that Khetia is on the border of Maharashtra State and it is a notorious fact for judicial notice that at that time Maharashtra was a deficit State in this regard and Madhya Pradesh a surplus one. On the other hand, the respondent had tried to obtain a license; and in spite of this breach the authorities have given 'him one in the beginning of May, that is to say, two-and-a-half months after the detection of this breach. This we would consider a sufficient ground why a sentence of imprisonment need not be awarded. We would accordingly sentence the respondent Jogilal to pay a fine of Rs. 5000 (five thousand) which is a small multiple of the ten or fifteen rupees per maund he might have made by the uncontrolled dealing. The imprisonment in default shall be rigorous for nine months, It is ordered that the stock of rice or its sale proceeds in deposit if it has already been sold is forfeited to Government.
Sen, J.
13. I have the advantage of reading the judgment written by my learned brother. Though I agree with him about the conclusions he has reached in finding the respondent Jogilal guilty; I am afraid I cannot take a serious view of the offence.
14. The admitted facts are that the respondents are dealers of agricultural produce including rice for a number of years, more than 40 years according to the application Ex. P-8. They also have got license for carrying on business under the M. B. Agricultural produce Markets Act of 1952, for selling foodgrains in the Mandi area of village Khetia. This license was valid upto 31-3-59.
15. There was no prohibition for dealers for dealing in foodgrains without license before the coming into force of the M. P. Foodgrain Dealers Licensing Order of 1958. This order came into force in 1958. The respondents deposited the necessary license fee on 16-1-59 for obtaining a license under the M. P. Foodgrain Dealers Licensing Order and obtained the same on 16-5-59. In the meantime after they had applied for license in January, the Naib Tehsildar, according to the prosecution story, on information received by him that the responendent was in possession of certain quantity of rice without license, visited the village Khetia. Jogilal came to him and stated that he was in possession of 150 maunds of rice. He also stated that he had applied for a license already. He also gave an undertaking that he would not sell the stock of rice which he brought from Khandwa before obtaining a license.
16. On the basis of Ex. P-5 however a challan was filed against both Jogilal and Kesrimal on 23-9-59.
17. The prosecution relies on the statement of the accused Jogilal and the possession of 150 maunds of rice which was found on 16-2-59. There is no reliable evidence on record as to when the rice was brought. Reliance was placed on Ex. P-5 in order to say that 'a few days before the incident, Naib Tehsildar arrived at Khetia, rice was brought from Khandwa.'
18. It cannot be doubted that the possession of 150 maunds of rice without license is contrary to Clause 3 of the M. P. Foodgrain Dealers Licensing Order. But the counsel for the respondents submitted that according to Ex. P-5 they had undertaken not to sell unless a license was obtained.
19. The clause which is alleged to have been contravened read as follows:-
'No person shall carry on business as a dealer except under and in accordance with the terms and conditions of the license issued in this behalf by the licensing authority.'
20. Dealer has been defined in Clause 2. For the purpose of this case the relevant portions are as follows:-
' 'Dealer' means a person engaged in the business of .................. storage for sale, of any one or more of the foodgrains in quantity of one hundred maunds or more..................'
21. The respondent was undoubtedly found in possession of 150 maunds of rice. Question is whether this was for sale. The prosecution relies on Clause 3 (2) of the Order which reads as follows :-
'For the purpose of this clause, any person who stores any foodgrains in quantity of one hundred maunds or more at one time shall, unless the contrary is proved be deemed to store the foodgrains for the purpose of sale.'
22. The contention of the respondent is, he is entitled to show that it was not for the purpose of sale. He says that it was not for the purpose of sale because he did not obtain license. He would only sell it if he would get the license. Therefore so long he does not get the license, the storage cannot be called for the purpose of sale. There is no evidence that he had made any attempt to sell the foodgrains beforehand. Undoubtedly burden is on the accused to show that the storage was not for sale.
23. The prosecution does not challenge the statement of the accused that the rice would be sold only after obtaining a license. But the offence against the accused is not selling without license but storage without license and this was undoubtedly storage for the purpose of sale, as there could not be any other purpose. Infact the accused admits that.
24. There cannot therefore be any doubt that he has contravened Clause 3 of the M. P. Foodgrain Dealers, Licensing Order 1958. He had no license required under Clause 3 on the date he was found to be in possession. But the circumstances indicated that this possession cannot be taken to be very seriously. There is no allegation that he was attempting to export foodgrains to another State. Simply because Khetia happens to be on the border of Maharashtra and Madhya Pradesh an inference should rot be drawn even for awarding punishment. He has been in this business for 30 to 40 years. Not only that, he has a license already for selling in that area under the M. B. Agricultural Produce Markets Act of 1952. He has not done anything surreptitiously. In fact before the date when foodgrains was seized he had applied for a license. If that was granted promptly as in such cases it should be, there could not have been any prosecution in spite of his being in possession of the foodgrains. Though it has not been pleaded by the accused it is known that rice is cheaper in February and the dealers always purchase rice in that season if they want to do business. The prosecution has given no date or data as to when rice was brought. That could have been easily available from the entry in the Octroi Naka if an attempt was made in that direction. The statement of the Naib Tehsildar that he did not see any entry between 1-2-59 to 16-2-59 is no evidence. The books, were not produced. Whatever that may be if the authorities were prompt in granting license within a fort-night there would have been no offence as the storage was reported to be on 16-2-59.
25. It is not always possible to get foodgrains immediately after the license is obtained. When the accused applied for a license he could have reasonably expected that he would get the same within a reasonable time and the reasonable time cannot be 4 months. The offence according to me is therefore nominal, if we avoid the use of the word 'technical'. From the storage of food-grains alone it cannot be suspected that it was meant for importing or exporting in a wrong direction after obtaining black market price, to use the common words. If really there was any evidence to that effect the matter was serious.
26. In the absence of a clear-cut evidence as to the date when rice was brought, or any evidence about his intention to export to prohibited areas, or to earn a black market price, I cannot speculate as to what his intention was, That he has been dealing in grains was known to everybody for the last 30 or 40 years. Within a short time after the Licensing Order came out he applied for license. The best season for obtaining rice is February March and it was not improper for him to think that he would get license before the stock arrived; but the delay in the office made the difference.
27. Therefore, though I uphold the conviction of the applicant punishable under Section 7 of the Essential Commodities Act of 1955, I sentence him to pay a nominal fine of Rs. 50/- or in default to suffer simple imprisonment for 15 days only.
(ORDER BY THE DIVISION BENCH)
28. As there is difference of opinion regarding sentence, the records of this case may be placed before my lord the Chief Justice for opinion by a third Judge.
(ORDER BY NEWASKAR, J. ON DIFFERENCE BETWEEN KRISHNAN AND SEN, JJ.)
29. In this appeal against the order of acquittalthe matter has been placed before me as difference hadarisen between the learned Judges constituting the Division Bench as regards the sentence of fine to be imposedupon the accused who was found guilty of the offencepunishable under Section 7 of the Essential Commodities Act,1955, for the contravention of the Madhya Pradesh Food-grain Dealers Licensing Order issued in pursuance of thepower vested in the State Government under Section 3 ofthe Act.
30. Facts on which he was found guilty by the learned Judges constituting the Division Bench were that after the Madhya Pradesh Foodgrain Dealers Licensing Order (hereinafter called 'the Order') had been promulgated on 7-10-1958 the respondent had deposited requisite licensing fee on 16-1-1959 and had applied for a license as required by the provisions of the Order on 29-1-1959 but had not received the same when he imported a truck load of rice weighing one hundred and fiftyfive Maunds and had that quantity in stock with him on 16-2-1959 when the Naib Tehsildar Tappa Pansemal visited Khetia. The accused on coming to know of Naib Tehsildar's visit submitted an application on the same day i.e. 16-2-1950 admitting to have brought approximately 150 maunds of rice and to have the same in his store. Under the provisions of Section 3(2) of the Order if a dealer had in his store any quantity of foodgrain for which license is required in excess of 100 maunds there would be presumption that he had the same for the purpose of sale. Since the respondent had not secured license till that date or even later upto 18-5-1959 there would be on terms of the provision aforesaid a presumption that he had stored the food-grains for the purpose of sale and consequently because of such storage he would be a dealer. As this was done by him when he was not armed with a license, which was a pre-condition, there was a clear contravention of the Order.
Both the learned Judges agree upon this. But when It came to awarding sentence Krishnan, J., was of the opinion that the mere circumstances, that he had deposited the license fee on 16-1-1959 and had submitted an application for a license on 29-1-1959 or had submitted an application to the Naib Tehsildar on 16-2-1959 accepting the fact that he had in store about 150 Maunds of rice brought by him about four or five days before that, cannot have the effect of operating as extenuating circumstance so as to reduce the gravity of the offence. On the other hand Sen, J., thought that there was no allegation that he was attempting to export food-grains to another State and that simply because Khetia happened to be on the border of Maharashtra an inference should not be drawn that he wanted to smuggle away the goods into the adjoining Maharashtra territory, while considering the question of sentence. The learned Judge was of the view that his applying for a license even before the goods came into his possession and his bringing of the goods not surreptitiously but openly were circumstances which ought to be taken into account in, awarding moderate fine on the ground that the offence was nominal.
31. In my opinion since the offence consists in contravention of the provision of the Order not to carry on business as a dealer except and in accordance with the terms and conditions of the license issued in this behalf by the licensing authority, procuring grain without having secured any such license to an extent which would lead to a presumption about a person's carrying on business as a dealer clearly ought to amount to an offence. About this both of the learned Judges agree. What extenuation could there be for a person who knows that he has no license and yet secures goods. His conduct in submitting to the Naib Tehsildar an application admitting the existence of the stock cannot be construed as indicative of his bona-fides as he should be credited with the knowledge that the Naib Tehsildar had come for checking and would discover him as having in his store contraband quantity. It is therefore clear that the fine to be imposed must be sufficiently heavy so as to serve as a deterrent for any other person in going ahead with a similar act with the nope of being dealt with leniently.
32. But as the offence has been tried by the First Class Magistrate ends of justice will be served if the maximum sentence of fine imposable by the trying Magistrate, is imposed. Section 12 of the Essential Commodities Act provides that notwithstanding anything contained in Section 32 of the Code of Criminal Procedure, 1898, it shall be lawful for any Magistrate of the First Class especially empowered by the State Government in this behalf to pass a sentence of fine exceeding Rs. 1000/-. This Act was passed in 1955 as No. 10 of 1955 when Section 32 of the Criminal Procedure Code contained a provision authorizing a First Class Magistrate to impose a fine of Rs. 1090/- only. Later the Criminal Procedure Code Amendment Act No. 26 of 1955 was passed which raised the limit of imposition of fine by him to Rs. 2000/-. Section 12 did not fix the upper limit hence where a State Government empowers a First Class Magistrate specially under the Essential Commodities Act No. 10 of 1955 the fine which he can impose is not limited to that under Section 32 Cr. P. Code. The learned Government Advocate was unable to bring to my notice any such special (sic) empowering of a First Class Magistrate. In view of this the limit which Section 32 has now imposed will be the legitimate limit for the imposition of fine.
33. I am led to impose maximum amount of fine because of the necessity that the sentence awarded ought to have a deterrent effect and should prevent others from emulating the example of the guilty person with impugnity.
34. In Mohanlal Gokuldas v. Emperor, AIR 1948 Bom 358 it was observed by Chagla, Acting C. J. and Gajendragadksr, J. :-
'Usually a fine is imposed when the offence is the result, of cupidity. When a person wants to make more money and to get rich and to amass a fortune at the cost of society and of its poor and needy members, the only way to deter others from following in his footsteps is to make it clear that crime is not easy and that he should not be permitted to enjoy his ill-gotten wealth. If the only sentence were the sentence of imprisonment and if the accused was permitted to come back after serving his sentence, to enjoy the wealth which he has amassed by antisocial acts or by committing offences, then it certainly would not deter others from following in his footsteps. Therefore, not only must a fine be imposed, but the fine must be of such a character and of such an amount as to be really deterrent in its character.'
35. I agree with the opinion thus expressed by the learned Chief Justice.
36. I would therefore hold that sentence of fine of Rs. 2000/- ought to be imposed upon the accused that being the maximum fine which could have been imposed by the trying Magistrate.
37. Reference is answered accordingly.