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Executive Officer, Elavally Panchayat Vs. Smt. Rosa - Court Judgment

SooperKanoon Citation
SubjectConstitution
CourtKerala High Court
Decided On
Case NumberCriminal Appeal No. 26 of 1968, Criminal R.P. No. 143 of 1968 and O.P. No. 2349 of 1968
Judge
Reported inAIR1970Ker88; 1970CriLJ470
ActsKerala Panchayats Act, 1960 - Sections 96 and 97; Constitution of India - Articles 246 and 265; Rice-Milling Industry (Regulation) Act
AppellantExecutive Officer, Elavally Panchayat
RespondentSmt. Rosa
Appellant Advocate S. Easwara Iyer,; L.G. Potti,; C.S. Rajan,;
Respondent Advocate State Prosecutor (for No. 1),; T.M. Krishnan Nambiar,; V
Cases ReferredCannanore v. C.T. Raman Nambiar
Excerpt:
.....96 and 97 of kerala panchayats act, 1960, articles 246 and 265 of constitution of india and rice-milling industry (regulation) act - whether sections 96 and 97 beyond legislative competence as rice mill industry fall under entry no. 52 in list i of schedule 7 to constitution of india and parliament alone had power to make law in respect of that matter - sections 96 and 97 relate only to matters mentioned in entry 6 of state list and do not entrench on entry 52 in union list - held, state legislature competent to enact law contained in these sections. (ii) fees - whether provisions relating to issue of licenses and permissions upon payment of fee under act and rules invalid - issue of licenses and grant of permissions conditional upon payment of fees - as such provisions relating..........(hereinafter referred to as the respondent).2. the respondent is the owner of a rice mill. the rice-milling industry is regulated by the rice milling industry (regulation) act, 1958. she sot a permit under section 5 and a license under section 6 of the rice milling industry (regulation) act for the establishment of a rice mill within the elavally panchayat; and accordingly she established a rice mill. section 96 of the kerala panchayats act, 1960 provides that the panchayat may with the previous approval of the director notify that no place in the panchayat area shall be used for any of the purposes specified in the rules madein this behalf being purposes for which in the opinion of the government, are likely to be offensive or dangerous to human life or health or property, without a.....
Judgment:

M.U. Isaac, J.

1. These three cases are the sequence of a criminal complaint which the Executive Officer of Elavally Panchayat, (hereinafter referred to as the appellant) instituted as C. C. No. 248 of 1967 in the Sub-Magistrate's Court, Chowghat against one Smt. Rosa (hereinafter referred to as the respondent).

2. The respondent is the owner of a rice mill. The rice-milling industry is regulated by the Rice Milling Industry (Regulation) Act, 1958. She sot a permit under Section 5 and a license under Section 6 of the Rice Milling Industry (Regulation) Act for the establishment of a rice mill within the Elavally Panchayat; and accordingly she established a rice mill. Section 96 of the Kerala Panchayats Act, 1960 provides that the Panchayat may with the previous approval of the Director notify that no place in the Panchayat area shall be used for any of the purposes specified in the rules madein this behalf being purposes for which in the opinion of the Government, are likely to be offensive or dangerous to human life or health or property, without a licence issued by the executive authority and except in accordance with the 'Conditions specified in such license. Section 97 of this Act provides, among other things, that no person shall, without the permission of the Panchayat and except in accordance with the conditions specified in such permission, instal in any premises any machinery, not being a machinery exempted by rules. Section 98 empowers the Government to make rules in respect of matters mentioned in Sections 96 and 97. Section 129 of the Act contains the general rule making power. In exercise of the powers conferred by the aforesaid sections of the Panchayats Act, the Government made the Kerala Panchayats (Licensing of Dangerous and Offensive Trades and Factories) Rules 1963, (hereinafter referred to as the Rules.). The rules provide for the issue of licenses under Section 96 and the issue of permits under Section 97. Schedule I to- the Rules specifies the purposes which in the opinion of the Government are likely to be offensive or dangerous to human life or health or property.

3. The Elavally Panchayat has notified under Section 96 of the Kerala PanchayatAct that no place within its limit shall be used for any of the above purposes without a license from the executive authority, Item 83 in Schedule I to the Rules is ''Machinery -- Used for industrial Purposes. ..... .'; and item 94 is 'Paddy-- Boiling or husking by machinery (forother than domestic use)'. Rice mills fall under both the above items. So, under the Panchayat Act and the Rules a person has to take a license and also obtain a permit for establishing a rice mill within the limits of the Elavally panchayat. The respondent did not obtain from the appellant any license for use of the mill premises. She applied for permission, to which she did not get a reply; and she started the mill without either the license or the permission. Section 109(3) of the Panchayats Act provides that, if orders on an application for a license or permission are not communicated to the applicant within 30 days or such longer period as may be prescribed in any class of cases, after the receipt of the application by the executive authority, the application shall be deemed to have been allowed. Section 132 of this Act provides, among other things, that whoever contravenes any of the provisions of the Act mentioned in Schedule III thereto shall be punishable with fine which may extend to the amount mentioned therein. Sections 96 and 97 are included in the above Schedule.

4. In the light of the above provisions of the Panchayat Act and the Rules, the appellant instituted C. C. 248 of 1967, charging the respondent with offences under Sections 96 and 97 of the Act. The trial court found the respondent guilty under Section 96 and sentenced her to pay a fine of Rs. 20/-. It acquitted her of the offence under Section 97, holding that, for failure of the executive authority to communicate its orders on the application for permission within the prescribed period, the respondent should be deemed to have been granted the permission. The appellant filed the present Criminal Appeal from the acquittal of the accused under Section 97 of the Panchayats Act. The respondent filed an appeal before the District Magistrate, Trichur from the order of conviction under Section 96. The appeal was dismissed; and the Criminal Revision Petition has been filed from the judgment of the District Magistrate. The respondent has stated several grounds in the Revision Petitions but at the hearing, the learned counsel urged only two points of law which she has raised against the maintainability of the prosecution. They are:--

(i) Sections 96 and 97 of the Kerala Panchayats Act, in so far as they relate to rice-milling industry, are beyond the legislative competence of the State Legislature, as rice mill industry falls under entry No. 52 in List I of the VII Schedule to the Constitution, and Parliament alone has the power to make any law in respect of that matter; and

(ii) The issue of licenses under Section 96 and permissions under Section 97 of the Panchayats Act is conditional upon payment of prescribed fees. What is prescribed as 'fees' is not really fees; and the provisions relating to the issue of licenses and permissions under the Act and the Rules are, therefore, invalid.

The respondent has also filed the Original Petition for a writ of mandamus or other appropriate writ or order directing the appellant not to insist on the respondent to take out a license under Section 96 or to obtain the permission under, Section 97 of the Kerala Panchayats Act, on the ground that these sections, in a far as they relate to rice-milling industry, are beyond the legislative power of the State Legislature. Therefore, the only question which arises for decision in the Original Petition is the first point raised in the Criminal Revision Petition. This point also arises for decision in the Criminal Appeal. The State of Kerala is also a respondent in the O. P.

5. I shall now consider the first point Article 246 of the Constitution provides as follows:--

'246. Subject-matter of laws made by Parliament and by the Legislatures of States,--

(1) Notwithstanding anything in Clauses(2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the 'Union List').

(2) Notwithstanding anything in Clause(3), Parliament, and, subject to Clause (1), the Legislature of any State also havepower to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule (in this Constitution referred to as the 'Concurrent List').

(3) Subject to Clauses (1) and (2) theLegislature of any State has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the 'State List').

(4) Parliament has power to make laws with respect to any matter for any part of the Territory of India not included in a State notwithstanding that such matter 'is a matter enumerated in the State List'

Entry 52 in List I of the VII Schedule to the Constitution reads:

'Industries the control of which by the Union is declared by Parliament by law to be expedient in the public interest.'

The Rice-milling Industry (Regulation) Act 1958 was enacted by Parliament to regulate the rice-milling industry. Section 2 of this Act declares that it is expedient in the public interest that the Union should take under its control the rice-milling industry. Consequently, rice-milling industry fell within entry No. 52 in List I. By virtue of Article 246 of Constitution, Parliament alone has power to make laws in respect of this matter; and the Rice Milling Industry (Regulation) Act is such a law made by Parliament. Section 5 of this Act deals with grant of permits for establishment of a rice mill. It reads as follows:--

'5(1) Any person or authority may make an application to the Central Government for the grant of a permit for the establishment of a new rice mill; and any owner of a defunct rice mill may make a like application for the grant of a permit for recommencing rice-milling operation in such mill.

(2) Every application under Sub-section (1) shall be made in the prescribed form and shall contain the particulars regarding the location of the rice mill, the size and type thereof and such other particulars as may be prescribed.

(3) If, on receipt of any such application for the grant of a permit, the Central Government is of opinion that it is necessary as to do for ensuring adequate supply of rice, it may, subject to the provisions of Sub-section (4) and Sub-section (5), grant the permit specifying therein the period within which the mill is to be established or, as the case may be, the mill is to re-commence rice-milling operation and such other conditions as it may think fit to impose, in accordance with the rules, if any, made in this behalf.

(4) Before granting any permit under Sub-section (3), the Central Government shall cause a full and complete investigation to be made in the prescribed manner in respect of the application and shall have due regard to -

(a) the number of rice mills operating in the locality;

(b) the availability of paddy in the locality;

(c) the availability of power and water supply for the rice mill in respect oil which a permit is applied for;

(d) whether the rice mill in respect of which a permit is applied for will be the huller-type, sheller-type or combined sheller-huller type;

(e) Whether the functioning of the rice mill in respect of which a permit is applied for would cause substantial unemployment in the locality;

(f) such other particulars as may be prescribed.

(5) In granting a permit under this section the Central Government shall give preference to a defunct rice mill over a new rice mill.

(6) A permit granted under this section shall be effective for the period specified therein or for such extended period as the Central Government may think fit to allow in any case.'

Section 6 of the above Act deals with grant of licenses for carrying on rice-milling operation and that section reads as follows:--

'6(1) Any owner of an existing rice mill or of a rice mill in respect of which a permit has been granted under Section 5 may make an application to the licensing Officer for the grant of a licence for carrying on rice milling operation in that rice mill.

(2) Every application under Sub-section 0) shall be made in the prescribed form and shall contain the particulars regarding the location of the rice mill, the size and type thereof and such other particulars as may be prescribed.

(3) On receipt of any such application for the grant of a licence, the licensing officer shall grant the licence on such conditions (including, in particular, conditions relating to the polishing of rice), on payment of such fees and on the deposit of such sum, if any, as security for the due performance of the conditions as may be prescribed.

(4) A licence granted under this section shall be valid for the period specified therein and may be renewed from time to time for such period and on payment of such fees and on such conditions as may be prescribed.'

The above two sections show that the location of the rice mill is a relevant and important factor in the matter of granting the permit and the licence. The permit is given for establishing a rice-mill In a certain locality, and the licence is given for operating that mill in that locality.

6. The contention of the respondent is that Sections 96 and 97 of the Kerala Panchayats Act are so wide in language as to apply to rice-milling industry, and that, in so far as they would apply to that industry, they are beyond the legislative power of the State, or those sections should be construed in such a way as not to apply to rice-milling industry. A legislature should be presumed to have acted within its powers; and it is a well settled canon of construction that if a statutory provision would yield to two constructions, one of which would make it beyond the power of the legislature and the other construction would bring it within that power, it has to be construed in the latter manner. I shall now read Sections 96 and 97 of the Kerala Panchayats Act;

'96. Purpose for which places may not be used without a licence -- The Panchayat may with the previous approval of the Director notify that no place in the Panchayat area shall be used for any of the purposes specified in the rules made in this behalf being purposes which in the opinion of Government, are likely to be offensive or dangerous to human life or health or property, without a licence issued by the executive authority and except in accordance with the conditions specified in such licence:

Provided that no such notification shall take effect until the expiry of sixty days from the date of its publication. 97. Permission for the construction of factories and the installation of machinery. -- No person shall, without the permission of the Panchayat and except in accordance with the conditions specified in such permission -

(a) construct or establish any factory, workshop or work-place in which it is proposed to employ steam power, water power or other mechanical power or electrical power; or

(b) instal in any premises any machinery or manufacturing plant driven by any power as aforesaid, not being machinery or manufacturing plant exempted by the rules.'

The Panchayats Act deals with matters falling under entries 5 and 6 in List IIof the VII Schedule to the Constitution; and these entries read:---

'5. Local Government, that is to say, the constitution and powers of municipal corporations, improvement trusts, district boards, mining settlement authorities and other local authorities for the purpose of local self-Government or village administration.

6. Public health and sanitation; hospitals and dispensaries'.

The power of a State Legislature to make laws on any of the matters enumerated in List II is subject to the power of the Parliament to make laws on any of the matters enumerated in List I. This is expressly stated in Article 246 of the Constitution. So, there can be no doubt that, if Section 96 or 97 of the Panchayats Act contains a law in respect of rice-milling industry, that law would be beyond the legislative power of the State Legislature. The learned counsel appearing for the appellant and the State of Kerala contended that Sections 96 and 97 of the Panchayats Act relate entirely to matters mentioned in entry 6 in List II, and that they do not relate to any matter mentioned in Entry 52 in List I. even though the provisions contained in the said sections may incidentally refer to a matter failing under Entry 52 in List I. They submitted that the above two Entries are entirely different, that the application of Sections 96 and 97 of the Panchayats Act to a matter falling under Entry 52 in List I was only incidental, and that such incidental application would not make them a law on a matter mentioned in entry 52.

7. Disputes with regard to the legislative spheres of the Parliament and the State Legislature are inevitable in the federal character of our Constitution, even in spite of the non-obstante Clause in Article 246(1). Dealing with this problem, Sir Maurice Gwyer C. J. stated in In the matter of C. P. Motor Spirit. Act, AIR 1939 FC 1:

'..... .an endeavour must be madeto solve it, as the Judicial Committee have said, by having recourse to the context and scheme of the Act, and a reconciliation attempted between two apparently conflicting jurisdictions by reading the two entries together and by interpreting, and, where necessary, modifying the language of the one by that of the other. If indeed such a reconciliation should prove impossible, then, and only then, will the non obstante Clause operate and the federal power prevail: for the Clause ought to be regarded as a last resource, a witness to the imperfections of human-expression and the fallibility of legal draftsmanship.

It has been shown that if each legislative power is given its widest meaning.there is a common territory shared between them and an overlapping of juris-dictions is the inevitable result; and this can only be avoided if it is reasonably possible to adopt such an interpretation as would assign what would otherwise becommon territory to one or the other. To do this it is necessary to construe this legislative power defined or described by one entry or the other in a more restricted sense than, as already pointed out, it can theoretically possess.'

The principles stated in the above passage have been approved by the Privy Council and our Supreme Court. In Calcutta Gas Co. (Proprietary) Ltd. v. State of West Bengal, AIR 1962 SC 1044, thequestion arose whether the West Bengal Oriental Gas Company Act, 1960, which the State Legislature enacted, was void, on the alleged ground that it related to a matter mentioned in Entry 52 of List I. The State contended that it relatedentirely to the matter mentioned in entry 25 in List II. This entry reads:--

'Gas and gas works'.

Dealing with these apparently overlapping entries, Subba Rao, J. in his judgment of the Court, said:--

'The power to legislate is given to the appropriate Legislatures by Article 246 of the Constitution. The entries in the three Lists are only legislative heads or fields of legislation: they demarcate the areaover which the appropriate Legislatures can operate. It is also well settled that widest amplitude should be given to the language of the entries. But some of the entries in the different Lists or in thesame Lists may overlap and sometimes may also appear to be in direct conflict with each other. It is then the duty of this Court to reconcile the entries and bring about harmony between them.'

After examining the relevant provisions of the Constitution, the learned Judge 'held:--

'It is, therefore, clear that the schemeof harmonious construction suggested on behalf of the State gives full and effective scope of operation for both the entries in their respective fields while that suggested by learned counsel for the appellant deprives Entry 25 of all its content and even makes it redundant. The former interpretation must, therefore, be accepted in preference to the latter. In this view, gas and gas works are within the exclusive field allotted to the States. On this interpretation the arguments of the learned Attorney-General that, under Article 246 of the Constitution, the legislative power of State is subject to that of Parliament ceases to have any force, for the gas industry is outside the legislative field of Parliament and is within the exclusive field of the Legislature of the State. We, therefore, hold that the im-pugned Act was within the Legislative competence of the West Bengal Legislature and was, therefore, validly made.'

Reference may be made to two more decisions of the Supreme Court. In State of Rajasthan v. G. Chawla, AIR 1959 SC 544 the question arose whether the Ajmer (Sound Amplifiers Control) Act, 1953 was void being a law falling under Entry 31 of the Union List. This entry reads:--

'Post and Telegraphs; Telephones. Wireless, broadcasting and other like forms of communications.'

The State contended that it was a law in respect of the matter mentioned in entry 6 of the State List and that it was within the power of the State Legislature. Entry 6 in the State List reads:--

'Public Health and Sanitation; hospitals and dispensaries.'

Upholding the contention of the State. Hidayatullah J. delivering the judgment of the court, said:--

'On a view of the Act as a whole, we think that the substance of the legislation is within the powers conferred by Entry No. 6 and conceivably Entry No. 1 of the State List, and it does not purport to encroach upon the field of Entry No. 31 though it incidentally touches upon a matter provided there. The end and purpose of the legislation furnishes the key to connect it with the State List. Our attention was not drawn to any enactment under Entry No. 31 of the Union List by which the ownership and possession of amplifiers was burdened with any such regulation or control, and there being thus no question of repugnancy or of an occupied field, we have no hesitation in holding that the Act is fully covered by the first cited Entry and conceivably the other in the State List.'

In the Hingir Rampur Coal Co. Ltd. v. State of Orissa, AIR 1961 SC 459. the validity of the Orissa Mining Areas Development Fund Act, 1952 which was passed by the State Legislature, was attacked on the ground that it related to a matter falling under Entry 52 of the Union List. The State contended that the Act related to a matter in Entry 23 of the State List, and that it was, therefore, within the power of the State Legislature. This entry reads-

'Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union.'

In dealing with above contention. Gajendragadkar J. who delivered the majority judgment of the Court, examined the relevant provisions of the State Act and also of the Industries (Development and Regulation) Act. 1951 which the Parliament has made in respect of thematter in Entry 52 of the Union List; and he held that the object of the State Act was the development of mining area in the State while that of the Central Act was to regulate the scheduled industries with a view to their development, and that these Acts, therefore, occupied different fields. The validity of the State Act was upheld on the above ground.

8. I shall now examine the constitutional validity of Sections 96 and 97 of the Kerala Panchayats Act. The Parliamentary declaration contained in Section 2 of the Rice Milling Industry (Regulation) Act shows that it was made in the public interest to take rice-milling industry under the control of the Union. Section 5 of this Act, which deals with grant of permits for establishing rice-mills, shows that the relevant considerations in the matter are the number of rice-mills operating in the locality, availability or paddy in the locality, availability of power and water for the mill, extent of unemployment that may be caused by the establishment ot the mill etc., and that the permit is granted only if the Central Government is of opinion that it is necessary to do so for ensuring adequate supply of rice in the locality. Section 6, which deals with grant of licenses, shows that the relevant considerations are the location of the mill, the size and type thereof and other prescribed particulars; and they are granted subject to conditions relating to the polishing of rice. So the object of the Rice-Milling Industry (Regulation) Act is to regulate the establishment of rice-mills in India for ensuring the adequate supply of rice, having regard to other relevant factors. The object of Section 96 of the Kerala Panchayats Act is to regulate the use of places within the Panchayat for purposes which in the opinion of the Government are likely to be offensive or dangerous to human life or health or property. Section 97 of this Act shows that its object is to control and regulate the establishment of factories, workshops and workplaces and installation of machineries and manufacturing plants within the Panchayat. The Rules would show that what is relevant in the grant of permission under the above section is the safety of the establishment and the person employed therein as well as considerations of public health and sanitation. Therefore, Sections 96 and 97 of the Panchayats Act and the Rice Milling Industry (Regulation) Act deal with entirely different matters. Sections 96 and 97 of the Panchayats Act relate only to matters mentioned in Entry 6 of the State List; and they do not entrench on Entry 52 in the Union List. I, therefore, hold that the State Legislature was competent to enact the law contained in these sections.

9. The next question for consideration is whether Sections 96 and 97 of the Kerala Panchayats Act and the provisions of the Rules relating to issue of licenses and grant of permissions are valid, as they are made conditional on payment of the prescribed fees. There is no case that levy of fees is related to actual service, if any, rendered to the class of persons who pay the same, or that the total collections on this account are earmarked for rendering any service for those persons. On the other hand, the levy is admittedly for augmenting the general levenue of the Panchayat Section 76 of the Panchayats Act expressly provides that all moneys received by the Panchayat shall constitute a fund called the Panchayat Fund, and that all taxes, duties, cesses, surcharge and fees levied under the Act or other law shall be included in the said fund. It is well settled by the decisions of this Court, and also by a very recent decision of the Supreme Court that such a levy is not a fee -- vide City Corporation of Calicut v. Sadasivan, 1968 Ker LT 539 = (AIR 1969 Ker 99) (FB). Travancore Tea Estates Co. Ltd. v. Executive Officer, Elappara Panchayat, 1968 Ker LT 776 (FB), Arya Vaidya Pharmacy Ltd. v. Health Officer, Ernakulam, 1968 Ker LT 789 and Municipal Council, Cannanore v. C.T. Raman Nambiar (Decision of the Supreme Court dated 10-12-1968 in C. A. No. 186 of 1966 (SQ). The provisions contained in Sections 96 and 97 of the Panchayats Act and the Rules relating to levy of fees are, therefore, invalid. As the issue of licenses and grant of permissions is conditional upon payment of such fees, the provisions relating to the issue of licenses and grant of permissions also become invalid.

10. In the light of my decision on the above two points, O. P. No. 2349 of 1968 should be dismissed; and I do so. Criminal R. P. No. 143 of 1968 is allowed; and Criminal Appeal No. 26 of 1968 is dismissed. The order of conviction and sentence of fine passed against the respondent is set aside; and the fine, if already recovered, is directed to be refunded to the respondent.

Narayana Pillai, J.

11. I agree.


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