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PETITIONER: SRI VIJAYLAKSHMI RICE MILLS, NEW CONTRACTORS COMPANY ETC.

       Vs.

RESPONDENT: STATE OF ANDHRA PRADESH

DATE OF JUDGMENT22/03/1976

BENCH: SINGH, JASWANT BENCH: SINGH, JASWANT RAY, A.N. (CJ) BEG, M. HAMEEDULLAH

CITATION:  1976 AIR 1471            1976 SCR  (3) 775  1976 SCC  (3)  37

ACT:      Rice (Andhra  Pradesh) Price  Control  (3rd  Amendment) order 1964, clause 2-Whether retrospectivity of substitution inferred in absence of express provision.

HEADNOTE:      Under s.  3 of  the Essential Commodities Act 1955, the respondent passed  the  Andhra  Pradesh  Procurement  (Levy) order 1959,  requiring  every  miller  and  dealer  of  rice (including the appellants) to sell to the respondent certain specified varieties  and quantities  of rice  at  controlled price on requisition being served on him. Clause 2(a) of the order defined  "controlled price" as the maximum price fixed by the  Central Government  from time  to time under s. 3 of the Act  for the  sale of  rice. On  December 19,  1963, the Central Government  Passed the  Rice (Andhra  Pradesh) Price Control order  1963, fixing the maximum price of akkulu rice at Rs.  46.89  per  quintal.  The  appellants  sold  several quantities of akkulu rice to the respondent from January 26, 1964, to  February 21, 1964, and were paid at the controlled rate. On  March 23,  1964 the  Central Government issued the Rice (Andhra  Pradesh) Price  Control (3rd  amendment) order 1964, and substituted Rs. 52.28 for Rs. 46.89 as the maximum price per quintal, of akkulu rice. The appellant’s claim for the benefit  of the enhanced price for the earlier sales was rejected by the Government of Andhra Pradesh. The appellants succeeded before  the Subordinate  Judge,  Machilipatnam  in their suits  for recovery  of the difference between the two controlled prices but lost before the High Court, in appeals preferred by  the State  of Andhra Pradesh. It was contended before this  Court that  the prices  fixed by the Government are for  the entire  season, and the appellants are entitled payment at  the amended  rates, regardless of the dates when the supplies  were made,  and  that  the  word  "substitute" infers retrospective effect.      Dismissing the appeals, the Court. ^      HELD: In  the absence  of express  words or appropriate language from  which  retrospectivity  may  be  inferred,  a notification takes effect from the date it is issued and not from any  prior date. Statutes should not be construed so as

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to create  new disabilities  or obligations  or  impose  new duties in respect of transactions which were complete at the time the Amending Act came into force. [778B-C]      (2)  The property  in the  goods having  passed to  the Government of  Andhra Pradesh  on the dates the supplies the made, the  appellants had  to be paid only at the controlled prices obtaining on the dates the sales were effects and not at  the   increased  price   which   came   into   operation subsequently.[778-D]      K. Appayya  Shanbhague & Co. v. The State of Mysore and Anr. (Unreported  decision S.C.  dated 20-4-1962); The Union of India.  represented by  the Secretary  Ministry of Food & Agriculture,  Government  of  India,  New  Delhi  v.  Kanuri Damodariah & Co. Alluri Venkatanarasiah (1968) 1 An. W.K. 81 and Mani  Gopal Mitra  v. The State of Bihar (1969) 2 S.C.R. 411, followed.

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil  Appeals Nos. 805, 806 and 972-977 of 1973      From the  judgment and  decree dated  the 8th June 1971 and 23rd  November 1971  respectively of  the High  Court of Andhra Pradesh at Hyderabad in Appeal Suit Nos. 766 of 1968, 18 of 1969, 779, 780, 782 to 785 of 1968, respectively. 776      F. S.  Nariman, J.  V. K.  Gurunathan, T. V. Narasimhan Murty and A. Subha Rao, for the appellants.      P. Ram Reddy and P. P. Rao, for the respondents.      The Judgment of the Court was delivered by      JASWANT SINGH,  J. This  batch of Appeals Nos. 805, 806 and 972 to 977 of 1973 by certificate from the judgments and decrees of  the High Court of Andhra Pradesh in Appeals Nos. 766 of  1968, 18  of 1969,  779 of 1968, 780 of 1968, 782 of 1968, 783  of 1971,  784 of  1968 and  785 of  1968 raise  a simple but  an interesting  question namely, whether for the supplies of  rice made  by the  appellants  in  January  and February, 1964,  they are  to be paid price according to the rate specified  in the  Rice (Andhra  Pradesh) Price Control (Third Amendment)  order,  1964  dated  March  23,  1964  or according to the rate specified in the Rice (Andhra Pradesh) Price Control order as it stood in 1963. The question arises in the following circumstances:      The appellants are millers and carry on the business of paddy and  rice in  the State of Andhra Pradesh. On July 31, 1959, the  Governor of  Andhra Pradesh  in exercise  of  the powers conferred  on him  by  section  3  of  the  Essential Commodities Act,  1955 (Central  Act X  of 1955) hereinafter referred to  as ‘the  Act’ made  an order  called the Andhra Pradesh Rice  Procurement (Levy) order, 1959 clause 3 of the order required  every dealer and every miller to sell to the State  Government  on  requisition  served  on  him  by  the requisitioning authority  at the  controlled  price  (a)  40 percent of  the quantity of rice held in stock by him at the commencement of  the order  and (b)  40 percent of the total quantity of  rice purchased  by him every day beginning with the commencement  of the  order. Clause  2(a) of  the  order defined "controlled  price" as  meaning  the  maximum  price fixed under section 3 of the Act for the sale of rice by the Central Government from time to time (emphasis supplied). On December 19, 1963, the Central Government in exercise of the power conferred  on it by section 3 of the Act made an order called the  Rice (Andhra Pradesh) Price Control order, 1963, which extended  to the  districts of Krishna, West Godavari,

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East Godavari,  Guntur, Nizamabad,  Warangal and  Nellore in the State  of  Andhra  Pradesh.  Clause  (2)  of  the  order provided that  the maximum  prices at which the varieties of rice specified  in column  (1) of the Schedule to that order were  to  be  sold  in  wholesale  quantities  would  be  as specified in  the corresponding entries in column (2) of the said Schedule.  The said  Schedule inter  alia provided that Akkulu rice  would be  sold at  Rs. 46.89  per  quintal.  In compliance with  the requisitions  served  on  them  by  the requisitioning authority of the State of Andhra Pradesh, the appellants sold  various quantities  of that variety of rice to the  Government of  that State  from January 26, 1964, to February 21,  1964, and  were paid  at the aforesaid rate of Rs. 46.89 per quintal. By means of the Rice (Andhra Pradesh) Price Control  (Second Amendment)  order, 1964,  dated March 20, 1964,  the Central  Government amended sub clause (1) of clause 2  of the  Rice (Andhra Pradesh) Price Control order, 1963 and  ordained that in the said sub-clause for the words "the Schedule’,  the words  and figures  schedule I shall be substituted. on 777 March 23,  1964, the  Central  Government  issued  the  Rice (Andhra Pradesh)  Price  Control  (Third  Amendment)  order, 1964. Clause 2 of the order ran thus:-           2. In  the Rice  (Andhra  Pradesh)  Price  Control      order, 1963,  in Schedule  I, for the varieties of rice      and the  maximum prices thereafter, the following shall      be substituted namely:- ____________________________________________________________ Varieties or rice                                    maximum price                                                 per quintal. ____________________________________________________________      1. Districts other than Nellore                ..             ..             ..           ..      Akulu     ..             ..             ..        52-25                ..             ..             ..           .. ____________________________________________________________      On  the  issue  of  this  order,  the  appellants  made representations  to   the  Government   of  Andhra   Pradesh requesting that  for the  aforesaid supplies  of Akkulu rice made by  them from  January 26  to February  21, 1964,  they should also  be paid  at the enhanced price of Rs. 52.25 per quintal. As the representations made by them did not evoke a favourable response,  they filed  suits in  the Court of the Subordinate  Judge,   Machilipatnam  for   recovery  of  the difference between  the controlled  prices specified  in the Rice (Andhra  Pradesh)  Price  Control  order,  1963,  dated December 19,  1963 and  Rice (Andhra  Pradesh) Price Control (Third Amendment)  order, 1964. The suits filed by them were decreed by  that Court.  Aggrieved by  these  judgments  and decrees the State of Andhra Pradesh preferred appeals to the High Court  at Hyderabad  which were  allowed on  the ground that is  the supplies  of rice  were made  by the appellants before  the  Rice  (Andhra  Pradesh)  Price  Control  (Third Amendment) order, 1964, they were entitled only to the price specified in the Schedule to the Rice (Andhra Pradesh) Price Control order,  1963. Dissatisfied  with these judgments and decrees,  the   appellants  applied  for  certificate  under Article 133(1)  (a) of the Constitution which was granted to them.      The sole  question for  determination in these appeals, as already  indicated, is  whether the appellants were to be paid price  for the  supplies to  rice  made  by  them  from January 26,  1964, to  February 21, 1964, at the rate of Rs.

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46.89 per  quintal the  rate specified  in the  Rice (Andhra Pradesh) Price  Control order, 1963, dated December 19, 1963 or at the enhanced rate of Rs. 52.25 per quintal as fixed by the Rice  (Andhra Pradesh)  Price Control  (Third Amendment) order, 1964 dated March 23, 1964.      Mr. Nariman  appearing on  behalf of the appellants has laid great  emphasis on  the word "substituted" occurring in clause 2  of the  Rice (Andhra Pradesh) Price Control (Third Amendment) order,  1964 and  has urged that the claim of the appellants  cannot   be  validity  ignored  Elaborating  his submission, counsel  has contended  that as the prices fixed by the  Government are  meant for  the  entire  season,  the appellants have  to be paid at the controlled price as fixed vide  the   Rice  (Andhra   Pradesh)  Price  Control  (Third Amendment) order, 1964, regardless 778 of the  dates an  which the  supplies were  made. We  cannot accede to  this contention.  It is  no doubt  true that  the literal meaning of the word "substitute" is "to replace’ but the question  before us  is from which date the substitution or replacement  of the new Schedule took effect. There is no deeming clause  or some  such provision  in the Rice (Andhra Pradesh) Price  Control (Third  Amendment)  order,  1964  to indicate that  it  was  intended  to  have  a  retrospective effect. It  is a well recognized rule of interpretation that in the absence of express words or appropriate language from which retrospectivity, may be inferred, a notification takes effect from  the date  it is  issued and  not from any prior date. The  principle is  also  well  settled  that  statutes should not  be construed  so as  to create new disability or obligations or  impose new duties in respect of transactions which were  complete at  the time the Amending Act came into force. (See Mani Gopal Mitra v. The State of Bihar.      The aforesaid  sales in  the instant  cases having been made by  the appellants  before the coming into force of the Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964, and  the property  in the  goods having  passed to the Government of  Andhra Pradesh on the dates the supplies were made, the  appellants had  to be paid only at the controlled price obtaining on the dates the sales were effected and not at  the   increased  price   which   came   into   operation subsequently. This view is in consonance with the provisions of section  3  of  the  Act  and  the  Andhra  Pradesh  Rice Procurement (Levy)  order, 1959  which clearly indicate that the price  payable  to  the  dealers  and  Millers  for  the supplies of rice made by them is the control price obtaining on the  date when the sale is made. Similar view is taken in the unreported  decision dated  April 20, 1962 of this Court in K.  Appayya Shambhague  and Co.  v. The State of Mysore & Anr. where  it was  laid down  that  the  order  made  under section 3(2)  (f) of  the Act  are offers  of sale which the person on  whom a requisition is served has no option but to accept and  that the  price that  has  to  be  paid  is  the controlled price  fixed by the Government under section 3(2) (c) of  the Act on the date when he goods are ascertained or when the  property in  the goods  passes to  the buyer. This decision was followed by the High Court of Andhra Pradesh in The Union  of India,  represented by the Secretary, Ministry of Food  and Agriculture,  Government of India, New Delhi v. Kanuri Damodariah & Co. Alluri Venkatanarasiah, where it was held that  an order  under section  3(2) (f)  amounts to  an agreement for  sale and the price payable for the quantities of rice  supplied is  a price payable in accordance with the price notified  under the  provisions of section 3(3) of the Act.

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    In the  instant cases, the sale having been made before the coming  into force  of the  Rice (Andhra  Pradesh) Price Control (Third Amendment) order, 1964, the appellants cannot justifiably  claim   the  benefit  of  the  increased  price specified in  the Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964. The acceptance of the. 779 contention raised  on behalf  of the appellants will lead to grave consequences. It will have the effect of reopening the transactions past  and closed  and would  thus give  rise to lots of difficulties.      Mr. Nariman  has, in  support of his contention, relied on the  following passage  occurring at  p. 394 in Craies on Statute Law (Sixth Edition):- "Explanatory and declaratory Acts retrospective           Where a  Statute is  passed  for  the  purpose  of      supplying an  obvious omission in a former statute, or,      as Parke  J. (afterwards  Baron Parke)  said in  R.  V.      Dursley (1832)  3 B.  & Ad.  465, 469  "to  ‘explain  a      former statute,"  the subsequent  statute has  relation      back to the time when the prior Act was passed. Thus in      Att.-Gen  v.  Poughtt  (1816)  2  Price  381,  392,  it      appeared that  by a  Customs Act of 1873 (53 Geo. 3, c.      33) a  duty was  imposed upon hides of 9s. 4d., but the      Act omitted  to state  that it  was to  be 9s.  4d. per      cwt., and  to remedy  this omission another Customs Act      53 Geo.  c. 105)  was passed  later in  the same  year.      Between the  passing of  these two Acts some hides were      exported, and  it was  contended  that  they  were  not      liable to pay the duty 9s. 4d. per cwt., but Thomson C.      B., in  giving judgment for the Attorney General, said:      "The duty  in this  instant was  in fact imposed by the      first Act,  but the  gross mistakes  of the omission of      the weight for which the sum expressed was to have been      payable occasioned the amendment made by the subsequent      Act, but  that had  reference to  the former statute as      soon as  it passed,  and they must be taken together as      if they were one and the same Act."           Where an  Act is  in its  nature declaratory,  the      presumption against  construing it  retrospectively  is      inapplicable.’      This passage  has, in  our opinion,  no bearing  on the question before us in view of the fact that the Rice (Andhra Pradesh) Price  Control (Third  Amendment)  order,  1964  is neither  explanatory   nor  declaratory,  as  sought  to  be interpreted by the counsel.      The contention  of  Mr.  Nariman  that  the  controlled prices fixed  by the Central Government for sale of rice are seasonal prices  not being  based upon  any cogent  material cannot also be accepted.      The High  Court was,  therefore, right  in allowing the aforesaid appeals  preferred by the respondent and reversing the judgment  and decrees  passed by  the Subordinate Judge, Machilipatnam.      In the  result, the appeal, fail and are dismissed with cost, limited to one set. M.R.                                      Appeals dismissed. 780