Lingo-sulphite Corporation of India Limited and ors. Vs. U.P. State Sugar Corporation Limited, Unit Bijnorand ors. - Court Judgment

Excerpt:
- [ s.r. dass, c.j.,; b.p. sinha,; k.h. subba rao,; k.n. wanchoo and; n.h. bhagwati, jj.] the petitioner, the editor of the english daily newspaper searchlight of patna, was called upon by the secretary of the patna legislative assembly to show cause before the committee of privileges of the assembly why appropriate action should not be taken against him for the breach of privileges of the speaker and the assembly for publishing in its entirety a speech delivered in the assembly by a member thereof, portions of which were directed to be expunged by the speaker. it was contended on behalf of the petitioner that the said notice and the proposed action by the committee were in violation of his fundamental right to freedom of speech and expression under art. 19(1)(a) and of the protection of his personal liberty under art. 21 of the constitution, and that, as an editor of a newspaper, he was entitled to all the benefits of the freedom of the press. the respondents relied on art. 194(3) of the constitution and claimed that the proceedings in the house as those in the british house of commons were not usually meant to be published, and in no circumstances was it permissible to publish the parts of a speech which were directed to be expunged and, therefore, formed no part of the official report and such publication was in clear breach of the privileges of the assembly. the points for determination were: (1) could the british house of commons entirely prohibit the publication of its proceedings or even of such portions of them as had been directed to be expunged ? (2) assuming that the british house of commons had such power and consequently the state legislature also had such power under article 194(3), could the privileges of the legislature under that article prevail over the fundamental right guaranteed by art. 19(1)(a)? the bihar legislature not having admittedly made any law governing its powers and privileges under entry 39 of list ii of the seventh schedule to the constitution, the question naturally was as to what were the powers, privileges and immunities of the british house of commons at the commencement of the constitution. held (per das, c. j., bhagwati, sinha and wanchoo, jj.) that there could be no doubt that the liberty of the press was implicit in the freedom of speech and expression guaranteed to a citizen under art. 19(1)(a) of the constitution and that must include the freedom of propagation of ideas ensured by the freedom of circulation. romesh thappar v. state of madras, [1950] s.c.r. 594, brijbhushan v. the- state of delhi, [1950] s.c. r. 605 and express newspaper ltd. v. union of india, [1959] s.c.r. 12, relied on. the liberty of the press in india flowed from this freedom of speech and expression of a citizen and stood on no higher footing and no privilege attached to the press as such. arnold v. king emperor, (1914) l.r. 41 i.a. 149, referred to. a survey of the evolution of parliamentary privileges in england showed beyond doubt that at the commencement of the indian constitution, the british house of commons had the power or privilege of prohibiting the publication of even a true and faithful report of the debates or proceedings that took place in the house, and with greater reason, the power and privilege of prohibiting publication of an inaccurate or garbled version of such debates and proceedings. these were the powers and privileges that art. 194(3) conferred on state legislatures and art. 05(3) conferred on the houses of parliament in india. it would not be correct to contend that art. 19(1)(a) of the constitution controlled the latter half of art. 194(3) or of art. 105(3) of the constitution and that the powers, privileges and immunities conferred by them must yield to the fundamental right of the citizen under art. 19(1)(a). as arts. 194(3) and 105(3) stood in the same supreme position as the provisions of part iii of the constitution and could not be affected by art. 13, the principle of harmonious construction must be adopted. so construed, the provisions of art. 19(1)(a), which were general, must yield to art. 194(1) and the latter part of its cl. (3), which are special, and art. 19(1)(a) could be of no avail to the petitioner. ramjilal v. income-tax officer, mohindergarh, [1951] s.c.r. a 127 and laxamanappa hanumantappa v. union of india, [1955] 1 s.c.r. 769, applied. anand bihayi mishra v. ram sahay, a.i.r. (1952) m.b. 31, disapproved. gunapati keshavyam reddy v. nafisul hasan, a.i.r. (1954) s.c. 636 explained as having proceeded on concession by counsel. nor could the petitioner complain of any breach, actual or threatened, of his fundamental right under art. 21 of the constitution since art. 194(3) read with the rules, framed by the bihar legislative assembly in exercise of its power under art. 208 of the constitution, laid down the procedure for enforcing its powers, privileges and immunities under that article and any deprivation of his personal liberty as a result of the proceedings before the committee of privileges would be in accordance with procedure established by law. held, further, that it was not for this court to prescribe any particular period for moving a privilege motion so as to make the subject matter of the motion a specific matter of recent occurrence within the meaning of the said rules. this was a matter for the speaker alone to decide. the time within which the committee of privileges was to submit its report was a matter between the house and its committee and the party whose conduct was the subject-matter of investigation could have no say in the matter. the effect in law of the order of the speaker to expunge a portion of the speech of a member might be as if that portion had not been spoken and a report of the whole speech despite the speaker's order might be regarded as a perverted and unfaithful report and prima facie constitute a breach of the privilege of the assembly. whether there had in fact been a breach of the privilege of the assembly was, however, a matter for the assembly alone to judge. per subba rao, j.-the second part of art. 194(3) was clearly a transitory provision and had no higher sanctity than that of the first. while a law when made by the state legislature under the first part would, by virtue of art. 13(2), be void to the extent it contravened the provisions of 19(1)(a), unless saved by art. 19(2), there could be no reason why the powers, privileges and immunities conferred under the second part should be free from the impact of the fundamental rights. as there was no inherent inconsistency between arts. 19(1)(a) and the second part of art. 194(3), full effect must be given to them both on the principle of harmonious construction. the wide powers and privileges enjoyed by the legislature and its members should, therefore, be so exercised as not to impair the fundamental rights of the citizen, particularly of one who was not a member of the legislature. in case of a conflict, art. 19(1)(a) must prevail over art. 194(3) and not vice versa and the privilege must yield to the extent it affected the fundamental right. gunupati keshavarm reddy v. nafisul hasan, a.i.r. (1954) s.c. 636, applied. at the commencement of the constitution the house of commons had no privilege to prevent the publication of a correct and faithful report of its proceedings, save those in respect of secret sessions held under exceptional circumstances, and had only a limited privilege to prevent mala fide publications of garbled, unfaithful and expunged reports of the proceedings. in the instant case, neither the notices nor the documents enclosed therewith disclosed any mala fides on the part of the petitioner or that he had knowledge that any portion of the speech had been expunged by the speaker. consequently, even supposing art. 194(3) prevailed over art. 19(1)(a), the petitioner was entitled to succeed. wasan v. walter, (1868) l.r. 4 q.b. 73, relied on. - as a second limb to this argument it was contended that the classification made between molasses covered by rule 22(1) on the one hand and rule 22(2) on the other is wholly irrational and the very purpose of the act is defeated.1. writ petition no. 391 of 1980 under article 32 of the constitution and civil appeal no. 651 of 1980 by special leave raise common question of law and, therefore, we propose to dispose them of by a common judgment.2. the circumstances leading to the writ petition and the appeal lie in a narrow compass. the appellant, united commercial syndicate, is the purchasing agent of m/s. lingo sulphite corporation, the petitioner in writ petition no. 391 of 1980 and m/s. audubon trading and export corporation of allahabad and calcutta, who are the manufacturers of lingo-sulphite in india.3. molasses is the basic raw material for the manufacture of lingo-sulphite which is an essential raw material for all basic refractories, steel plants, cement factories, carbon-black plants and many other important industries. molasses is also used for distillation. over the years molasses has become a valuable commodity on account of its multi-use. the preservation, distribution and prices of the molasses were, therefore, controlled by a legislation, the uttar pradesh sheera niyantran adhiniyam, 1964 (u.p. act no. 24 of 1964), hereinafter referred to as the act.4. united commercial syndicate used to purchase molasses for their principals from the open market. later on it decided to make direct purchase from the u.p. state sugar corporation ltd., unit bijnor (a stale government undertaking). it entered into an agreement with respondent no. 1, the u.p. state sugar corporation ltd., whereunder respondent no. 1 agreed to sell 28,300 quintals of molasses of 1977-78 production at the statutory price of rs. 9/-per quintal and duties etc. provided the appellant agreed to pay the total amount of rs. 3 lakhs, being the total cost of molasses as estimated at the above statutory price. it was further stipulated that in case the above price was not valid in law, the appellant will have to pay the price at the rate of rs. 25.10 per quintal inclusive of administrative charges and other taxes and duties etc., as agreed to by the appellant. there were other terms of the agreement but it is not necessary for the purposes of disposal of these cases to refer to them. a sum of rs. 2 lakks had been paid in pursuance of the agreement and the balance of rs. 1 lakh was to be paid at the earliest. the respondent no. 1, however, sought to calculate the price of the molasses in question at the rate of rs, 25.10 per quintal. the appellant felt aggrieved and it took the stand that the respondent no. 1 could not charge more than the statutory price, in spite of the fact that the appellant had offered the price of rs. 25.10 per quintal to respondent no. 1. the appellant filed two p petitions in the high court for a writ of mandamus or any other appropriate writ or direction declaring that respondent no. 1 was not entitled to charge the price for the molasses in excess of the price fixed by the act. the high court by its order dated 31st of october, 1979 dismissed the petitions in limine. the appellant has come up in appeal by special leave to challenge the order of the high court. m/s. lingo sulphite corporation of india ltd has also filed a petition under article 32 of the constitution for the same relief on the same grounds as in the aforesaid appeal.5. in order to appreciate the points involved in the case it would be appropriate to refer to the material provisions of the act and the rules framed thereunder.6. section 3 of the act authorises the state government to constitute an advisory committee to advise on matters relating to the control of storage, preservation, gradation, price, supply and disposal of molasses. section 4 provides for the appointment of a person as controller of molasses for the purpose of exercising the powers and performing the duties of the controller of molasses. section 5 enjoins every occupier of a sugar factory to take precautions for preservation of molasses. section 6 prohibits the occupier of a sugar factory to adulterate or allow to be adulterated any molasses produced or held in stock by him section 7a(1) enjoins any person, who requires molasses for his distillery or for any purpose of industrial development to apply in the prescribed manner to the controller specifying the purpose for which it is required. sub-section (2) of section 7a authorises the controller to make enquires in the matter as he may think fit and to pass an order under section 8 with due regard to the factors enumerated in sub-section (3) of section 7a.7. section 8(1) authorises the controller to direct the occupier of any sugar factory to sell and supply in the prescribed manner such quantity of molasses to such persons as may be specified in the order and the occupier shall, notwithstanding any contract, comply with the order. sub-section (2)(a) of section 8 enjoins that the occupier shall supply, molasses only to a person who requires it for his distillery or for any purpose of industrial development and sub-clause (aa) of sub-section (2) directs the person specified in the order of the controller to utilise the molasses supplied to him in pursuance of an order of the controller for the purpose specified in the application made by him under sub-section (1) of section 7a and to observe all the restrictions and conditions as may be prescribed. section 10 provides that the occupier of a sugar factory shall sell molasses in respect of which an order under section 8 has been made at a price not exceeding that prescribed in the schedule attached to section 10.8. rule 12 of the u.p. sheera niyantran niyamavali, 1974 enjoins the occupier of every sugar factory to submit to the controller by august 31 each molasses year a statement in form m.f. 9 specifying an approximate estimate of the quantity of molasses to be produced in a sugar factory during the molasses year following, along with such other information as is required under that form. rule 13(1) provides that every distillery in u.p. shall by august 31 each year submit to the controller a statement in form m.f. 8 specifying its estimated requirement of molasses for the purposes of distillation during the molasses year following along with such other information as may be required under that form. likewise, rule 13(2) requires the director of industries to furnish the controller by august 31 each year the estimated requirement of molasses for industrial purposes within the state relating to the molasses year following :9. rule 23 provides; (1) all stock of molasses produced in a sugar factory shall be deemed to have been reserved for supply to distilleries or other persons requiring it for purposes of industrial development and no stock of molasses produced in a sugar factory shall be sold or otherwise disposed of by the occupier of any sugar factory except in accordance with an order in writing from the controller.(2) the controller shall release any stock of molasses in favour of occupier of a sugar factory only when the same is not required for distilleries or for other purposes of industrial development.10. rule 23(1) provides:(1) the state government may levy administrative charges exclusive of the price payable to a sugar factory on the molasses released for sale by the controller towards meeting the cost of establishment for supervision of control over molasses at such rate or rates as may be notified from time to time.11. rule 24(1) provides:(1) save in pursuance of an order of the controller, no person shall purchase any molasses from any sugar factory, or transport or possess any molasses purchased from such sugar factory, unless the said molasses has been released by order of the controller as not required for distilleries or other purposes of industrial development and a declaration to that effect in form m.f. 13 has been obtained from the occupier of the sugar factory concerned.12. a perusal of the relevant provisions of the act and rules aforesaid makes it clear that the occupier of a sugar factory can sell molasses to a person specified in the order of the controller at the controlled price. the occupier of every sugar factory has to give an estimate of the molasses to be produced in the sugar factory as also the estimate of requirement of molasses for distillation and industrial purposes. if there is any surplus after meeting the requirements of the persons in whose favour there is an order of the controller, the same will be released in favour of the occupier.13. the question for consideration in the instant case is whether the molasses released in favour of the occupier by the controller is also to be sold at the controlled rate or it can be sold at the market price as a free commodity.14. shri garg, senior counsel contends that from the scheme of the act and the rules it is evident that the entire production of molasses is to be controlled by the controller appointed under the act, at every stage. he is to take into account the estimated supply and the estimated demand of the commodity; thereafter, he is to allot the commodity to a particular person for a particular purpose at the controlled statutory price fixed by the schedule to the act. the act and the rules further provide that nobody will store, sell, transport or use the said commodity without the order of the controller and the price and distribution of molasses both are controlled by the act and the contravention of the provisions of the act have been made penal and the high court has gone wrong in assuming that certain quantity of molasses which are covered by rule 22(2) are immune from the restrictions and fetters of the act and the said rules, which is erroneous and indefensible in law inasmuch as such a construction as has been put by the high court will defeat the very purpose and object of the said act and the rules. as a second limb to this argument it was contended that the classification made between molasses covered by rule 22(1) on the one hand and rule 22(2) on the other is wholly irrational and the very purpose of the act is defeated. according to the learned counsel, it makes no difference whether the molasses are covered by rule 22(1) or 22(2) inasmuch as the object of the present legislation is to ensure that the sale and the distribution of molasses is controlled in an equitable manner and, therefore, to hold that section 8 is applicable to rule 22(1) and not to rule 22(2) is arbitrary and violative of article 14.15. shri rana appearing for respondent no. 1 on the other hand has contended that on a correct interpretation of the relevant provisions of the act and the rules the interpretation put by the high court is fully warranted.16. section 10 of the act which has been referred to above enjoins the occupier of a sugar factory to sell molasses in respect of which an order under section 8 has been made at a price not exceeding that prescribed in the schedule. a plain reading of the section makes it clear that the occupier of a sugar factory is obliged to sell molasses at the price not exceeding that prescribed in the schedule only in respect of which an order under section 8 has been made. but sub-clause (2) of rule 22 authorises the controller to release any stock of molasses in favour of an occupier of a sugar factory only when the same is not required for distilleries or for other purposes of industrial development. if a certain quantity of molasses has been released in favour of the occupier, because the same was not required for distilleries or for other purposes of industrial development, it is open to the occupier to sell that quantity of molasses in free market to any person at a price prevalent in the market. section 10 of the act requires an occupier of a sugar factory to sell molasses at a price not exceeding that prescribed in the schedule only in respect of which an order under section 8 has been made. no limitation or fetter has been put on the occupier of a sugar factory to sell molasses which was released in his favour. it was, therefore, open to him to sell the molasses released in his favour at the free market price.17. the contention that the classification made with regard to molasses covered under rule 22(1) or rule 22(2) is an unreasonable classification cannot be accepted, there have been other enactments in which similar provision has been made, for example, the levy sugar was to be sold only at the controlled rate but free sugar was to be sold by the factories at a free market price and that has been always accepted as a valid classification. the appellant entered into an agreement with respondent no. 1 and agreed to pay the price of the molasses at the rate of rs. 25.10 per quintal having entered into such an agreement with its eyes wide open it cannot now turn turtle and contend that it was liable to pay only at the rate of rs. 9/- per quintal, the statutory price. it is true that the parties cannot be allowed to contract themselves out of law. if the law was that no molasses released in favour of the occupier of the sugar factory could be sold at a price higher than the controlled one, than the contention of the appellant would be correct. on an analysis of the relevant provisions of the act we are quite clear that the controlled price was applicable only to the molasses for which an order had been passed by the controller in favour of a specified person either for the purpose of distillation or for other industrial purposes. 'but so far as the molasses released in favour of the occupier of a sugar factory is concerned, there is no requirement of the law that the occupier should sell it only at the controlled price.18. it was further contended that the respondent was not entitled to administrative charges. this contention loses sight of the terms of the agreement between the parties which includes administrative charges also.19. for the foregoing discussion we find no force either in the appeal or in the writ petition under article 32. they are accordingly dismissed. there shall, however, be no order as to costs.