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PETITIONER: BHAGWATI SARAN AND ANOTHER

       Vs.

RESPONDENT: THE STATE OF UTTAR PRADESH.

DATE OF JUDGMENT: 20/01/1961

BENCH: AYYANGAR, N. RAJAGOPALA BENCH: AYYANGAR, N. RAJAGOPALA SINHA, BHUVNESHWAR P.(CJ) DAS, S.K. SARKAR, A.K. MUDHOLKAR, J.R.

CITATION:  1961 AIR  928            1961 SCR  (3) 563  CITATOR INFO :  RF         1965 SC1185  (5)  RF         1972 SC1324  (12)  D          1980 SC 506  (10)

ACT: Iron  and Steel Control-Notification fixing maximum  prices- Whether  ultra vires-If notification  discriminates  between "controlled  stockholders" and " registered stockholders  "- Report   to  Magistrate--Facts  constituting  the   offence, meaning  of-New Point-Iron and Steel (Control of  Production and Distribution) Order, 1941, Cl. 11-B Essential  Supplies (Temporary  Powers)  Act,  1946  (XXIX  of  1946),  s.   11- Constitution of India, Art.  14.

HEADNOTE: A police officer made a report under s. 11 of the  Essential Supplies   (Temporary   Powers)  Act,  1946,   regarding   a contravention of cl.  11-B(III), Iron and Steel (Control  of Production and Distribution) Order, 1941, read with s. 8  of the Essential Commodities Ordinance, 1955, to the Magistrate against the appellants who were registered stockholders that they had sold iron bars at prices higher than the controlled rate.  After enquiry the Magistrate framed a charge  against the  appellant  under S. 7,  Essential  Supplies  (Temporary Powers)  Act, 1946, read with cl.  11-B(III) of the  Control Order.  The appellants contended that the charge ought to be quashed  on  the grounds, (i) that the notification  of  the Controller  fixing  the maximum sale price  of  the  several categories of iron and steel was ultra vires the rule-making power  in  cl. 11-B(i) of the Control Order, (ii)  that  the notification  was discriminatory and violated Art.  14,  and (iii) that the complaint could not be taken cognisance of by the Magistrate because the report of the police officer  did not  set out the facts constituting the offence as  required by s. II of the Act.  The first two grounds were raised  for the first time before the Supreme Court. Held, that the notification fixing the rates was intra vires cl. 11-B(i) of the Control Order.  The notification did  not omit  any class mentioned in cl.  11-B(1) from its  purview;

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it included 564 "registered producers" and it was not shown that there  were any  "producers  "  other  than  "  registered  producers  " enumerated in the notification.  The notification governed " registered stockholders " also as they were included in  the residuary  category  of  persons  other  than  "  registered producers " and " controlled stockholders ". The  notification was not discriminatory and did not  offend Art.  14  of the Constitution.  The  notification  no  doubt permitted  the grant of credit facilities and the  right  to charge  for  cutting and wastage in sales  to  "  controlled stockholders  "  but not to " registered stockholders  "  in regard  to  sales by them.  Differentiation was not  per  se discrimination.   There was no material to show  that  there was  any  unfair or irrational  discrimination  which  could attract Art. 14. Held, further, that the police report on which the  prosecu- tion was launched satisfied the requirements of s. II of the Act.  The purpose of s. II was to eliminate private  persons from  initiating  prosecutions and to confine it  to  public servants.   The requirement of the section that  the  report should   be  in  writing  and  should  set  out  the   facts constituting  the  offence was to ensure that  there  was  a record  that  the  public  servant  was  satisfied  that   a contravention   of  the  law  had  taken  place.    If   the contravention was sufficiently designated in the report  the requirements of the section were satisfied.  Section II  did not require the mention in the report of details which would be  necessary  to be proved to bring home the guilt  to  the accused. Dr.  N. G. Chatterji v. Emperor (1946) 47 Cr.  L.J. 876  and Rachpal   Singh  v.  Rex  (1947)  50  Cr.   L.J.  469,   not applicable. Additional  grounds, other than those urged before the  High Court,  would  not  be permitted to  be  raised  before  the Supreme   Court  as  a  matter  of  course,  but  only,   in exceptional   circumstances   like   cases   of   subsequent legislation  or where questions of fundamental  and  general importance were raised.

JUDGMENT: CRIMINAL  APPELLATE JURISDICTION: Criminal Appeal No. 16  of 1959. Appeal from the judgment and order dated November 18,  1958, of the Allahabad High Court in Criminal Reference No. 452 of 1956. B.   V. S. Mani, for the appellants. G.   C. Mathur and C. P. Lal, for the respondent. 1961.  January 20.  The Judgment of the Court was  delivered by AYYANGAR,  J.-Having  heard  the  learned  Counsel  for  the appellants in full we did not consider it necessary to  call on the respondent since, we were clearly 565 of  the  opinion that the contentions raised in  the  appeal possessed no merit. The  legality  of  a prosecution for  contravention  of  the notification  fixing  the maximum prices  at  which  certain categories  of  iron & steel could be sold is  the  subject- matter  of this appeal.  The appellants are two  in  number, related  to  each  other as husband and  wife.   The  second appellant-Sushila  Devi-is " a Registered Stockholder "  and

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is  stated to be the proprietor of the firm " Balwanta  Devi Sushila  Devi " situated in Sultanpur in Uttar  Pradesh  and the first appellant Bhagwati Saran, her husband, the manager of the said firm. There  has  been some previous history  before  the  present prosecution  was  initiated  but it is  sufficient  for  the purposes  of  this appeal to start with the  report  to  the Judicial Magistrate, Amathi, by the officer incharge of  the Police  station,  Sultanpur, dated August 20,1955.   It  was headed  "  Offence-Section II B Iron &Steel  Control  Order, 1941" and set out the following facts:               " Bhagwati Saran used to work as a Karinda  in               the firm of Balwanta Devi Sushila Devi and had               all  along been doing sales and  purchases  at               the  shop, and also issued receipts under  his               signatures.  Shrimati Sushila Devi is the wife               of  accused  Bhagwati Saran and  she  was  the               proprietor.   Balwanta Devi has  died.   Hence               she alone is the proprietor.  In the course of               investigation   it  was  also  revealed   that               Bhagwati Saran had from time to time sold some               iron-bark;  on  behalf  of  this  firm   after               receiving  price more than the  control  rate,               which  he had all along been getting  printed,               and’  had  been getting  some  other  receipts               checked  fictitiously  under the  Control  Act               from  the  office of the Supply  Officer.   An               information  relating to it was given to  Shri               P. N. Kapoor, the then D. M., Sultanpur by his               munim   Kalapnath  and  on  it  a   case   was               registered  at  this police  station  and  the               investigation                              was               made...... .................. On the report of               the P.P. the S.P. ordered another charge-sheet               to  be submitted under section 8 of  Essential               Commodities  Ordinance  of 1955.   Hence  this               charge-sheet under section 11-B               566               (III) Iron and Steel Control of Production and                     Distribution Order, 1941, read with s’ 8               of Essential Commodities Ordinance of 1955  is               sent  against both the accused.   The  accused               persons after being arrested were released  on               bail.  It is, therefore,               prayed.  that the accused persons after  being               summoned may be punished." The report further stated that 4 volumes of cash memos,  and 5  volumes  of  register of Permits were  deposited  in  the Malkhana  and would be produced in evidence and followed  it with  a  list  of 13 prosecution  witnesses.   The  Judicial Magistrate  registered  the case and issued summons  to  the accused on September 16, 1955, the case being directed to be called  on September 30, 1955.  The accused were  thereafter examined before the Magistrate under s. 364 of the  Criminal Procedure  Code on March 23, 1956, and on the next  day  the Magistrate  framed  a  charge against  them  which  read  as follows:               " That you between 10th January 1952 and  27th               February 1952 in Sultanpur sold 11 Cwt. 12 lb.               iron bars on 11th January 1952 %ad 3 Cwt. iron               bars  on  18-2-52 and Cwt. iron bars  on  26th               February  1952 at the rate of Rs. 21-13-9  per               Cwt. though the controlled rate as notified in               Government  of  India Gazette dated  1st  July               1952 for the commodity was Rs. 21-2-4 per Cwt.

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             and thus you charged Rs. 1-15-0, Rs. 2-2-3 and               Rs.  4-4-6 respectively excess and  more  than               the controlled price and thereby committed  an               offence punishable under s. 7 E. S. Temp.   P.               Act 1946 read with s. 1 1 B (iii) of Iron and               Steel  Control of Production and  Distribution               Order of 1941 and I hereby direct that you  be               tried by the said Court on the said charge." The  two  appellants  thereupon moved  the.   Court  of  the Sessions  Judge,  Sultanpur,  to revise  the  order  of  the Magistrate  dated  March 24, 1956, framing  charges  against them under s. 7 of the Essential Supplies (Temporary Powers) Act,  1946-Act  XXIV of 1946 (referred to hereafter  as  the Act). The points urged at that stage were mainly two: (1)  That the notification by the Controller under 567 cl.  11-B(1) fixing the maximum prices which were stated  to have  been  contravened  not having been  filed  before  the Court,  the  Magistrate erred in framing a charge,  and  (2) that the report of the police was not in conformity with the provisions of s. 11 of the Act.  The learned Sessions  Judge upheld  the second of the above contentions which was,  that the report made by the police officer did not set out "  the facts constituting the offence" as required by s. II of  the Act.  He rejected the other point put forward by the  appel- lants but in view of his conclusion that there was a  defect in the report which went to the root of the jurisdiction  of the  Magistrate  to take cognizance of the case, he  made  a reference  to the High Court with a recommendation that  the charge  framed  against  the appellants  be  quashed.   This reference was heard by a Single Judge of the High Court, who disagreed  with the learned Sessions Judge in his view  that the report did not satisfy the requirements of s. 11 of  the Act.  Before the learned Judge, however, a further point was urged,  that  s.  11-B  of  the  Iron  &  Steel  Control  of Production  and  Distribution  Order, 1941  (which  will  be referred to hereafter as the Control Order) was itself ultra vires.   This further objection was referred to  a  Division Bench  for  decision.  The point urged  before  the  learned Judges  of  the  Division Bench was that the  power  to  fix prices  vested  in the Steel Controller by cl. 11-B  of  the Control  Order  was unconstitutional, as  violative  of  the right  to carry on business guaranteed by Art. 19(1) (g)  of the  Constitution.  The learned Judges answered  this  point against  the  appellants and the case thereafter  came  back before  the learned Single Judge for final disposal  of  the reference  by the Sessions Judge.  The learned  Counsel  for the  appellants once again made a submission to the  learned Judge  regarding  the  report of the  police  officer  dated August 20, 1955, not satisfying the requirements of s. 11 of the  Act and pressed before him the view which found  favour with  the  learned  Sessions  Judge.   In  a  more  detailed judgment,  the learned Judge again rejected this  contention and dismissed the reference and directed the prosecution  to continue.  It is this 73 568 order  of the High Court. of Allahabad that is the  subject- matter of appeal now before us. on a certificate granted  by that Court. It  would  be seen that the only two points  in  controversy before  the High Court were: (1) whether the report  of  the police officer dated August 20, 1955, contained " the  facts constituting  the offence " with which the  appellants  were

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charged, as to satisfy the requirements of s. 11 of the Act, and (2) whether el. 11-B of the Control Order, violated  the fundamental  right to carry on business guaranteed  by  Art. 19(1)(g).  In the grounds of appeal to this Court and in the statement  of  case,  however, the  appellants  have  raised various  other  grounds and have also filed a  petition  for leave to urge these additional grounds, We desire to make it clear that grounds additional to those urged before the High Court would not be permitted to be raised before this  Court as  a matter of course and that petitions for  such  purpose would  not be granted save in exceptional cases.  It has  to be noticed that in hearing and dealing with such  additional grounds the Court is handicapped in not having the advantage of  the opinions of the High Court on the points urged.   It is the correctness of the decisions of High Courts that  are sought to be challenged in appeals and it is but proper that the   correctness  of  these  judgments  should,   save   in exceptional  cases like for instance subsequent  legislation or questions of fundamental and general importance etc.,  be assailed only on grounds urged before such Courts.  Besides, when among the grounds thus urged as in this case is includ- ed  a  violation of Art. 14, the  handicap  is  accentuated, since  the material facts on which the classification  might rest could not be properly, investigated or evaluated on the basis  of  the  affidavits filed in  this  Court  without  a careful  sifting of the facts which a consideration  by  the High Court would afford.  If in the appeal now before us, we have  departed from this rule, and permitted the  appellants to  urge  the  additional  grounds it  was  because  of  the circumstance  that the prosecution was pending  and  learned Counsel  submitted  that  he  would  seek  to  sustain   his contention 569 regarding  the  violation  of  fundamental  rights  on   the materials already on record. The  ground regarding the constitutionality of el.  11-B  of the  Control  Order  has  been  the  subject  of   elaborate consideration  by  this Court in Union of India  v.  Messrs. Bhana Mal Oulzari Mal (1) and is, therefore, no longer  open to  argument.  Learned Counsel for the  appellant  therefore did  not  challenge the correctness of the judgment  of  the High Court upon this point. Besides  the ground based on a non-compliance with s. 11  of the Act which we shall consider later, learned Counsel urged before  us  two points with reference  to  the  notification issued by the Steel Controller fixing the maximum prices  at which the several categories of iron and steel could be sold by  producers  and stockholders.  These were: (1)  that  the notification  of the Controller dated July 1, 1952, for  the contravention of which the appellants were being prosecuted, was ultra vires the rule-making power conferred upon him  by el.  11-B(1)  of  the Control Order, (2)  if,  however,  the notification  was held to be within his power, the same  was unconstitutional in that it was discriminatory and  violated Art. 14 of the Constitution.  As we have indicated  earlier, these   grounds  of  challenge  to  the  validity   of   the notification  were  not  made in any  of  the  Courts  below including  the High Court, but for the reasons indicated  we permitted learned Counsel to argue them before us. In  order to appreciate the contention presented in the  two forms,  it is necessary to set out the terms of el.  11-B(1) which conferred power upon the Controller to fix the maximum base-prices at which the several varieties of iron and steel could be sold.  Clause 11-B(1) runs:               "   11-B.   Power  to  fix   prices.-(1)   The

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             Controller   may   from  time   to   time   by               notification  in the Gazette of India fix  the               maximum prices at which any iron or steel  may               be sold (a) by a Producer, (b) by  stockholder               including a Controlled Stockholder and (c)  by               any  other person or class of  persons.   Such               price or prices may differ for iron and  steel               obtainable from               (1)   [1960] 2 S.C.R. 627.               570               different  sources and may include  allowances               for  contribution  to  and  payment  from  any               equalization    fund   established   by    the               Controller   for   equalising   freight,   the               concession  rates payable to each producer  or               class  of producers under  agreements  entered               into by the Controller with the producers from               time to time, and any other disadvantages." Clause  (2) of the Control Order defines " producer as  "  a person  carrying  on the business of manufacturing  iron  or steel ", and " registered producer " as " a producer who  is registered  as  such by the Controller ".  The  same  clause defines " stockholder " as " a person holding stocks of iron or  steel  for sale who is registered as  a  stockholder  by Controller  "  and  "  Controlled  stockholder  "  as  "   a stockholder appointed by the Con. troller to hold stocks  of iron  or  steel under such terms and conditions  as  he  may prescribe  from  time  to time ". The  notification  of  the Controller dated July 1, 1952, impugned in these proceedings runs in these terms, quoting only the material words:               "  Under  Ministry of  Commerce  and  Industry               Notification............  the  prices  of  all               items of steel under columns 1, 11 and III  in               the  schedule of Base Prices of  the  attached               price  circular  No.  1  of  1951  have   been               increased by Rs. 50/- per ton with effect from               1st  July,  1952,  except  item  19(b),  i.e.,               Billets  which has been increased by Rs.  45/-               per ton......... The other General and Special               Conditions  of sale mentioned in the  attached               Price circular remain the 571 The  price  circular dated July 1, 1951,  referred  to  here consisted of eight columns which ran thus: (Price in rupees per ton)           Maximum Base Prices at Calcutta, Bombay and Madras ----------------------------------------------------------- Base    Materials   Column I   Column II      Column III Price Item              For sales by   For sales by   For sales by                  Registered     controlled all   persons No.              Producers.   stockholders.    other than                                               Registered                                              Producers and                                               controlled                                              stockholders. ----------------------------------------------------------            Untested Untested Untested Untested Untested Te-                                                        sted            Rs.      Rs.         Rs.     Rs.    Rs.     Rs.         ----------------------------------------------------    A-Bars,  Structural  and plates  etc.

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  Bars   and Rods 303    333         328       363    348     383      (Rounds and squares      below 3" and flats      up to and including      5" wide) 2 to 42.. ........................................ This   was  followed  by  General  Conditions  and   Special Conditions  which inter alia made provision for the  purpose of  rounding  off inequalities in freight caused  by  places being  situated  at  varying distances  from  the  place  of production  etc.   It  was the operation of  some  of  these conditions   that   was  urged  as  giving   rise   to   the discrimination  complained  of,  but it  will,  however,  be convenient  to deal with them later, after disposing of  the argument  regarding  the notification not being  within  the powers of the Controller under cl. 11-B (1). The  ’ground  urged in support of the  contention  that  the notification by the Controller was not in conformity 572 with cl. 1 1 -B (1) was this: Whereas under cl. 1 1 - B  (1) the Controller was directed to fix the maximum prices  which could  be  charged  by three different  classes,  viz.,  (a) Producers,    (b)    Stockholders    including    Controlled stockholders,   and   (c)  Other   persons,   the   impugned ,notification departed from this scheme in two respects: (1) The  clause contemplated that the notification should  apply to  all  " producers " whereas " producers "  other  than  " Registered   producers  "  were  wholly  left  out  by   the Controller  with  the result that no limitation  was  placed upon  the  price they could charge, (2) Whereas  the  clause directed  the  Controller  to  include  both  the  types  of stockholders" Registered " as well as " Controlled "- within the same class and make the same limit of prices  applicable to  both,  the notification had included only  "  Controlled stockholders  "  as  the second category of  dealers  and  " registered  stockholders " had not been specified eo  nomine by  him.  This meant either that "Registered stockholders  " were  wholly  outside the class of dealers governed  by  the notification  or that they were intended to be  included  in the  residuary  class  in column  III.   On  these  premises learned  Counsel urged that if "  registered stockholders  " like the second appellant were not within the  notification, the  prosecution  must  fail  because  the  maximum   prices chargeable by her had not been fixed.  If on the other  hand such   dealers   had  been  separated  from   "   Controlled stockholders " and included in the residual category, such a classification  was not countenanced by cl. 11-B(1) and  was therefore ultra vires. We  consider that these submissions are wholly  without  any substance.   Before  the argument that " producers  "  other than  " registered producers " had not been included in  the notification can be accepted, it has to be established  that there is any such producer.  There is a list of " registered producers " appended to the notification and learned Counsel admitted  that he could not say that there were any  besides these,  who  were "Producers" of iron and steel  within  the meaning  of  the  Control  Order.   If  therefore,  every  " producer  "  was  registered,  there is  no  scope  for  the argument that 573 any  persons  had  been left out and permitted  to  sell  at prices of their choice. The other part of learned Counsel’s argument that registered stockholders " were not governed by the notification because

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they  were  not  included  in column  II  thereof  and  that dealings by them were not subjected to the maxima of  prices fixed  by  it, has only to be stated to  be  rejected.   The heading  of  the last column shows that  all  categories  of dealers other than "registered producers.," and " controlled stockholders " were included in the residuary category.  The related  contention  that the Controller acted  outside  his powers in differentiating between " controlled  stockholders "  and " registered stockholders " and in  fixing  different maxima of prices that could be charged by the two categories of  dealers, does not deserve serious consideration  either. If  we understand the classification aright, it is like  one between  wholesale dealers and retailers and it is  on  this basis that the maximum price that could be charged by the  " Registered Stockholders " who fall under column III is fixed at  Rs. 20/- per ton above that permissible to "  Controlled Stockholders " in respect of the category of steel which  we have  extracted  earlier.  The  classification  which  gives persons in the category of the appellants this advantage  is certainly not one regarding which a complaint could be made. Even  when  this advantage conferred  on  registered  stock- holders by the classification by the Controller was  pointed out to learned Counsel for the appellant he persisted in his argument that "registered stock. holders". should have  been put in column II along with " controlled stockholders "  and should have been permitted to sell only at the same  maximum prices.   This  is  sufficient to  show  that  the  argument regarding  the  classification was frivolous and  could  not have  been  urged  with any  seriousness.   This  apart,  we consider  that  even  on  the terms of  cl.  11-B  (1),  the Controller  is  not  prevented from  drawing  a  distinction within  the  three classes which are specified in  it.   The purpose  and  policy of the enactment is to ensure  that  an essential  commodity like iron and steel is made  available, to 574 the consumer at reasonable prices and in the achievement  of this  objective  classification  of producers  or  of  other stockholders based upon rational grounds would obviously  be within the power of the Controller.  Taking for instance the last  class (c) " any other person or class of persons,"  it cannot  be that this group could not be  sub-classified,  if there was any reason or necessity to do so.  If head (c)  is susceptible of this interpretation, as it obviously must, we see  no  reason  why  head  (b)  should  not  be   similarly construed.  We have therefore no hesitation in rejecting the contention of learned Counsel, that the notification of  the Controller fixing maximum prices is beyond his power, as not warranted  by  the terms of el.  11 -B (1)  of  the  Control Order. The  argument next advanced in challenge of the validity  of the  notification was, that some of the  General  Conditions appended  to  the notification were  discriminatory  of  the class  of "registered stockholders" as compared with  the  " controlled stockholders " invoking for this purpose Art.  14 of the Constitution.  Learned Counsel did not challenge  the legality  of  the creation of the equalisation fund  by  the allowances  for what is termed as " place extra  ".  Learned Counsel,  however, urged two matters wherein facilities  had been afforded or price increases permitted, to "  controlled stockholders" which were denied to " registered stockholders "  and that these had been done without any rational  basis. These  were: (1) The 3rd of the special conditions for  sale by " controlled stockholders " read: "The question of credit facilities  will  be a matter for  negotiation  between  the

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customers and the controlled stockholders.  " (2) Similarly, Condition  5  also relating to  "  controlled  stockholders" read:  ,The base-prices are. for sizes and length  available in Size.  Customers requiring material cut to length or size not  available in stock will be required to pay cutting  and wastage  charges  agreed  between  the  customers  and   the stockholders.   " Coming now to the special  conditions  for sale " by persons other than producers and controlled stock- holders,  " i.e., the conditions which governed  sales  like those by the second appellant, special condition 1 575 read:     " The base-rates given in column III above are ex- site and apply to sales by all persons other than  Producers and Controlled Stockholders............ and are not  subject to additional charges for cutting or for credit  facilities. "   Neither  of  these  points-cutting  charges  or   credit facilities-could be held to be discriminatory without a full investigation  of the facts and circumstances which  led  to the imposition of these special conditions.  Differentiation could  never  per  se be discrimination, nor  is  there  any presumption that the adoption of different rules for  groups differently situated is unequal treatment violative of  Art. 14.  On the other hand, the presumption is the other way and the  party that alleges unjustifiable discrimination  should establish it to the satisfaction of the Court.  We  consider that there is no material on the basis of which an  argument could  be  sustained that the special  conditions  to  which learned Counsel adverted contained any element of unfair  or irrational discrimination to attract Art. 14. There was a slight and subsidiary point raised in regard  to the allowance of credit facilities and cutting charges.   It was said that these charges were indeterminate and that  the Controller  having  been  directed by cl. 11-B  (1)  to  fix definite maximum prices had departed therefrom by permitting increases of undefined amounts.  This argument again has  no substance.   The  base-price for the commodity  having  been fixed, there are incidentals which by their very nature were incapable  of  definite  quantification,  since  they   were dependent on each individual case.  This contention also  we therefore  reject.   In passing, we might observe  that  the matter before this Court in Union of India v. Messrs.  Bhana Mal  Gulzari  Mal  (1)  related  to  a  prosecution  for   a contravention  of a notification of an earlier date, but  in terms  identical with the present, except as to the  prices, wherein the dealers in the commodity were classified in  the same manner as has been done in the notification now  before us  and with the same general and special  conditions.   The respondent then before this Court was " a registered (1)  [1960] 2 S.C.R. 627. 74 576 stockholder  " who was being prosecuted for effecting  sales in  excess  of the maximum prices fixed.  The fact  that  on that  occasion  no  contention  was  urged  challenging  the validity  of  the notification as beyond the powers  of  the Controller,   on  the  grounds  now  put   forward   clearly indicates,  that the matters now urged never appeared  then, as  a  possible  source of grievance  to  a  party  situated similarly  as  the  second  appellant.   We  hold  that  the notification fixing the prices together with the  conditions appended thereto are valid and enforceable. The  last  point  that  remains to be  dealt  with,  is  the contention  that the initiation of the  prosecution  against the  appellants  was  invalid for  non-compliance  with  the requirements of s. 11 of the Act.  This Section runs :

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             " 11.  Cognizance of offences.-No Court  shall               take  cognizance  of  any  offence  punishable               under this Act except on report in writing  of               the facts constituting such offence made by  a               person  who is a public servant as defined  in               section  21 of the Indian Penal Code  (XLV  of               1860)." Learned Counsel for the appellants urged that though two  of the conditions specified by the statute, viz., (1) a  report in  writing,  (2) by a public servant  were  satisfied,  the third requisite, viz., that the report should set out the  " facts  constituting such offence " was lacking and  that  by reason of this defect the Magistrate could not lawfully take cognizance   of  the  case  against  the   appellants.    In elaboration  of this point learned Counsel pointed out  that the  report did not specify: (a) the date when  the  alleged sales  took place, (b) the quantity sold, (c) the person  in question who was the buyer and who paid the excess over  the controlled  price,  (d) the class or category  of  iron  and steel  which was the subject of the sale by the  appellants, (e) the precise maximum price which had been fixed for  such variety, (f) the amount which the appellants were alleged to have  received  in excess.  The learned Judge  of  the  High Court   rejected  this  contention  and,  in  our   opinion, correctly.   In the report which we have  already  extracted the provision 577 of  the  law  which  the  appellants  were  stated  to  have contravened was set out, and it was there stated that  being "  registered stockholders " they had sold the  goods  above the  price notified and that they had further, in  order  to conceal  their  crime,  fabricated evidence.  It  is  to  be noticed  that  the report is required to contain  only  "  a statement  of  facts  constituting the  offence  "  and  its function  is  not  to serve as  a  chargesheet  against  the accused.  The function or purpose of the second of the above three  requirements  of  s.  11  is  to  eliminate   private individuals such as rival traders or the general public from initiating  a  prosecution  and  for  this  purpose   before cognizance  is  taken the complaint is required  to  emanate from  "  a public servant ". The two  further  requirements, viz., that the report should be in writing and regarding the contents of the report, are to ensure that there shall be  a record   that  the  public  servant  is  satisfied  that   a contravention   of  the  law  has  taken  place.    If   the contravention in question is sufficiently designated in  the report,  and  in the present case that cannot  be  disputed, since besides a reference to the notification stated to have been  contravened,  the report states that the  accused  had effected  sales  above the maximum prices specified  in  the notification, the requirements of the section are satisfied. The  details which would be necessary to be proved to  bring home  the  guilt  to the accused  and  which  comprised  the several matters enumerated by learned Counsel which we  have set  out,  will  be details which would emerge  at  a  later stage,  when after notice to the accused a charge is  framed against them, and of course at the stage of the trial.  They would all be matters of evidence and s. 11 does not  require the  report to be or to contain either the  charge-sheet  or the  evidence in support of the charge, its  function  being merely to afford a basis for enabling the magistrate to take cognizance of the case. In  support of his submission regarding the construction  of s.  11  reliance  was placed on two decisions:  Dr.   N.  G. Chatterji v. Emperor (1) and Rachpal Singh v.

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(1)  (1946) 47 Cr.  L.J. 876. 578 Rex (1).  Both these were cited before the learned Judge and we  agree  with the manner in which he has  dealt  with  and distinguished  them.  No doubt, in both these cases  it  was held  that the requirement of r. 130 (1) of the  Defence  of India  Rules  (whose language was similar to is. 11  of  the Act)  as  to  the  Statement of  "  facts  constituting  the contravention  " was not complied with, but the " reports  " dealt with in them, bear no resemblance to the report in the case before us. In the first of these decisions, the recital in  the  report  was  that the accused was  guilty  of  a  " prejudicial  act to the interest of the public " and  "  had prejudiced the success of financial measures with a view  to the  efficient  prosecution of the war ". These  words  were held  to  be absolutely vague, even the particular  rule  or provision  of law which was said to have  been  contravened, not even being mentioned in the report.  The other  decision in 50 Criminal Law Journal does not bear any analogy to  the present case either.  The report there in question ran:               "On the statement of the informant an  offence               under  s. 81(2), Defence of India  Rules,  has               been  committed for which the charge-sheet  is               being submitted." On this it was held that the facts alleged to constitute the contravention  were not set out in the report and  that  the Magistrate had therefore no jurisdiction to take  cognizance of  the  case.   Obviously this case could  not  assist  the learned  Counsel to sustain a contention that the report  in the present case was defective.  We consider that the report on   which  the  prosecution  was  launched  satisfied   the requirements of s.  11 of the Act. In the result the appeal fails and is dismissed. Appeal dismissed. (1) (1947) 50 Cr.  L.J. 469. 579