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CASE NO.: Appeal (civil)  4674 of 2004

PETITIONER: Godawat Pan Masala Products I.P. Ltd. & Anr.

RESPONDENT: Union of India & Ors.

DATE OF JUDGMENT: 02/08/2004

BENCH: K.G. Balakrishnan & B.N. Srikrishna.

JUDGMENT: J U D G M E N T

(arising out of SLP (C) No. 24449 of 2002)

With

Civil Appeal No. 4677 /2004 @ SLP (C) No.23635/02, Civil Appeal No.  4676 /2004 @ SLP (C) No.24292/02, Civil Appeal No. 4675 /2004 @ SLP (C) No.   533/03, Civil Appeal No.  4678/2004 @ SLP (C) No.   834/03, Civil Appeal No. 4679 /2004 @ SLP (C) No. 2186/03 And  Writ Petition (C) No. 173 of 2003

SRIKRISHNA,  J.

       Leave granted in the special leave petitions and the writ petition is  admitted.

       These appeals and writ petition arise from different areas and, though   marginally differing on facts, raise substantially similar issues  of law.  They  can, therefore, be conveniently disposed of by a common judgment.         The common issue raised for consideration of this Court in all these  cases is the validity of  notifications issued by the Food (Health) Authority  under Section 7(iv) of the Prevention of Food Adulteration Act, 1954  (hereinafter referred to as the ’Act’) by which the manufacture, sale, storage  and distribution of pan masala and gutka (pan masala containing tobacco)  were banned for different periods.  We shall take the facts in the civil appeal  arising out of special leave petition No. 24449 of 2002 as typical of the  cases. Facts: Civil Appeal arising out of SLP(C) No. 24449 of 2002         The appellants manufacture gutka within the state of Maharashtra,  which is stored in convenient godowns and sold both within and outside the  state of Maharashtra.  By a notification dated 23rd July, 2002 issued by the  Commissioner, Food and Drug Administration and Food (Health) Authority  for the State of Maharashtra,  the manufacture, sale, storage and distribution  of pan masala and gutka (pan masala containing tobacco) were banned for a  period of five years with effect from 1st August, 2002.  The appellants  challenged the validity of this notification by a writ petition No. 2024 of  2002 before the High Court of Judicature at Bombay.  By its judgment dated  18th /19th September, 2002, the division bench of the Bombay High Court  dismissed the writ petition upholding the validity of the notification.   Aggrieved thereby, the appellants challenge the said judgment by the  present appeal. Writ Petition No. 173 of 2003: Petitioners Nos. 1 to 5 are associations and cooperative societies of

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arecanut growers, petitioners Nos. 6 and 7 are engaged in the manufacture  and sale of pan masala and gutka in the State of Karnataka.  They are  aggrieved by a notification dated 27th February, 2002, issued by the  competent officer appointed as Food (Health) Authority for the State of  Andhra Pradesh under Section 7(iv) of the Act, by which the sale of all  brands of pan masala (containing tobacco) and chewing tobacco/ zarda/  khaini under any brand name was prohibited "in the interest of public  health" in the entire state of Andhra Pradesh with immediate effect.   The petitioners also challenge another notification dated                  19th November, 2001 issued by the Director for Public Health and  Preventive Medicine and State Food (Health) Authority, Government of  Tamil Nadu, under Section 7(iv) of the Act directing that no person shall  himself or by any person on his behalf, manufacture for sale or store, sell or  distribute: (i) chewing tobacco; (ii) pan masala; (iii) gutka, containing  tobacco in any form or any other ingredients injurious to health, under  whatever name or description in the State of Tamil Nadu. This notification  is purported to have been issued in the "interest of public health", for a  period of five years with effect on and from  19th November, 2001.   The third notification which is challenged in the writ petition is the  notification dated 23rd July, 2002 issued by the Commissioner of Food and  Drug Administration and Food (Health) Authority for the State of  Maharashtra.  By the said notification, issued purportedly in exercise of the  powers under Section 7(iv) of the Act, "in the interest of public health", the  sale of gutka and pan masala, containing tobacco or not containing tobacco,  is prohibited for a period of five years effective from 1st August, 2002. The  notification directs that "no person shall himself or any person on his behalf,   shall manufacture for sale or store, sell or distribute gutka or pan masala,  containing tobacco or not containing tobacco, by whatever name called.  The fourth notification  challenged in the writ petition is the   notification dated 24th January, 2003 issued by the Directorate of Food and  Drugs Administration and Food (Health) Authority for the State of Goa.  By  this notification, purportedly issued under Section 7(iv) of the Act, the "sale  of gutka and pan masala, containing tobacco or not containing tobacco, by  whatever name called," is prohibited within the state of Goa and it is  directed that "no person shall himself or any person on his behalf, shall  manufacture for sale or store, sell or distribute gutka or pan masala,  containing tobacco or not containing tobacco, by whatever name called."   The prohibition in the notification is made effective from 26th January, 2003.   All the four notifications are under challenge. Civil Appeals arising out of S.L.P. Nos.  23635/02, 24292/02, 533/03,  834/03 and 2186/03  

       The appellants are engaged, inter alia, in the manufacture and trade of  pan masala and gutka, pan masala containing tobacco and other allied  tobacco products. They sell their products all over India including State of  Maharashtra.  They have a wide network of dealers through whom their  products are sold to the public at large in the state of Maharashtra. They also  have operating depots in the state of Maharashtra.  The appellants challenge  the notification dated 23rd July,  2002, issued by the Commissioner, Food  and Drug Administration and Food (Health) Authority for the state of  Maharashtra.  The High Court by its common judgment dated 18th/19th  September, 2002 negatived the challenge. Civil Appeal arising out of SLP No. 24292 of 2002         The appellant carry on the business of manufacture and sale of pan  masala, gutka and other tobacco related items.  Aggrieved by the  notification dated 19th February, 2002 issued by the Food (Health)  Authority, State of Andhra Pradesh, prohibiting the sale of pan masala under  any brand name with a emblem of gutka, containing  tobacco, within the  state of Andhra Pradesh, with immediate effect, and the notification dated        27th February, 2002 issued by the same authority which prohibited the sale  of all brands of pan masala containing tobacco and chewing  tobacco/zarda/khaini under any brand name in the entire State of Andhra  Pradesh, with immediate effect, the appellant challenged the validity of both  notifications before the High Court of Andhra Pradesh.  The division bench  of the high court by its judgment dated 16th August, 2002 dismissed the writ

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petition. Being aggrieved thereby, the appellant is before this Court. Core Issue:         These appeals and the writ petition raise the common issue as to the  power of the Food (Health) Authority to issue an order of prohibition,  whether permanently  or quasi-permanently, under Section 7(iv) of the Act.

Challenge:         The broad grounds of challenge formulated by the  appellants/petitioners are as under: 1.      The Act vests the power to declare a substance as injurious to health  only with the Central Government under Section 23 of the Act and no  such power is vested with the State Government. 2.      Each of the manufacturers has been issued a licence to manufacture  the banned product by the Central Government under the provisions  of the Act. As long as the conditions stipulated in the licence are  fulfilled, and there is no violation of the terms of the licence or the  provisions of the concerned statute, it is not open to the state  Government, by any administrative order, to prohibit the manufacture  of the concerned product undertaken under a licence issued by the  Central Government. 3.      The power of the State Government to frame rules under Section 24 of  the Act is extremely narrow and limited to the field which is not  covered by Section 23, the exclusive domain of the Central  Government. 4.      The Act is concerned with the prevention of adulterated articles of  food and not intended to prohibit any article used as food or otherwise.  5.       The impugned notification dated 23rd July, 2002,  issued by the State  of Maharashtra operates extra territorially, and, to that extent, is ultra  vires of the powers of the State. 6.      By enacting the Cigarettes and Other Tobacco Products (Prohibition  of Advertisement and Regulation of Trade and Commerce,  Production, Supply and Distribution) Act, 2003, (Act 34 of 2003),  Parliament has evinced its intent to occupy the whole field with regard  to prohibition of advertisement and regulation of trade and commerce,  production, supply and distribution of tobacco products. While the  central legislation prohibits the sale of tobacco products only to  persons below age of 18 years, the impugned notification purports to  impose a wholesale ban without any qualification. Thus, there is a  conflict between the powers exercisable under two central statutes  dealing with the same subject and, therefore, provisions of the Act 34  of  2003 must prevail. Legal provisions:         In order to appreciate the contentions of the learned counsel, it will be  necessary to briefly notice the relevant provisions of the Act.  As the  preamble of the Act indicates, "it is an Act to make provision for the  prevention of adulteration of food." Section 2(ia) defines what is  ’adulterated food’.  Broadly speaking, the definition covers situations where  a food article is sub-standard, or contains injurious ingredients or has  become injurious to health by reason of packing or keeping under  unsanitary conditions or having become contaminated or is otherwise not fit  for consumption.  The definition also extends to cases of articles which fall  below the prescribed standards of purity or quality. The Act also deals with  misbranding of food articles, which is not of concern to us for the present.   For the purpose of administration of the Act, any urban or rural area may be  declared by the Central Government or the State Government by a  notification to be a ’local area’ for the purpose of the Act. In relation to such  local area, an officer is appointed by the Central Government or the State  Government by  notification in the Official Gazette to be in-charge of the  Health administration in such area with such designation as specified  therein and such officer is defined to be a ’Local (Health) Authority’ by  Section 2(viiia). Section 2(vi) defines ’Food (Health) Authority’ as the  Director of Medical and Health Services or the Chief Officer in-charge of  Health administration in a State, by whatever designation he is known, and  includes any officer empowered by the Central Government or the State  Government, by notification in the Official Gazette, to exercise the powers

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and perform the duties of the Food (Health) Authority under the Act with  respect to such local area as may be specified in the notification.  Section 7,  upon which most of the arguments turn, needs to be noticed.  Section 7  reads as under: "7.  Prohibitions of manufacture, sale, etc., of certain  articles of food. - No person shall himself or by any  person on his behalf manufacture for sale, or store, sell or  distribute - (i)     any adulterated food; (ii)    any misbranded food; (iii)   any article of food for the sale of which a licence is  prescribed, except in accordance with the conditions of  the licence; (iv)    any article of food the sale of which is for the time  being prohibited by the Food (Health) Authority in the  interest of public health; (v)     any article of food in contravention of any other  provision of this Act or of any rule made thereunder; or (vi)    any adulterant. Explanation.-For the purposes of this section, a person  shall be deemed to store any adulterated food or  misbranded food or any article of food referred to in  clause (iii) or clause (iv) or clause (v) if he stores such  food for the manufacture therefrom of any article of food  for sale." Section 22A empowers the Central Government to give such directions as  it may deem necessary to a State Government regarding the  implementation of the Act. Section 23 empowers the Central Government  to make rules to carry out the provisions of the Act.  In particular, and  without prejudice to the generality of the rule making power, the power of  the Central Government includes the one in clause (f).  Section 24 of the  Act is the section which grants rule making power to the State  Government. The State Government may, after consultation with the  Committee, and subject to the condition of previous publication,  thereunder make rules for the purpose of giving effect to the provisions of  the Act in matters not falling within the purview of section 23. Sub section  (2) of Section 24 grants power to the State Government to make rules with  regard to the powers and duties of the different authorities under the Act.  Prescription of forms of licences for the manufacture for sale, storage, sale  and distribution of articles of food,  the conditions subject to which such  licences may be issued and the fees payable therefor, analysis of any article  of food or matter and provision for further delegation of power by the State  Government to the Food (Health) Authority or the subordinate authorities  are the matters covered within this delegated power.         Part IX of the Prevention of Food Adulteration Rules, 1955  (hereinafter referred to as the ’Rules’) deals with the conditions for sale  and licence.  Rules 49 and 50 lay down detailed conditions applicable to  different types of licences granted for manufacturing of different products  used as food articles.           In Appendix B there is prescription of definitions and standards of  quality of different food articles.  Of relevance to us is paragraph A.30  which deals with pan masala. Paragraph A.30 reads thus: "A.30 PAN MASALA means the food generally taken as such  or in conjunction with pan, it may contain- Betelnut, lime, coconut, catechu, saffron, cardamom, dry fruits  mulathi, sabermusa, other aromatic herbs and spices, sugar,  glycerine, glucose, permitted natural colours, menthol and non- prohibited flavours. It shall be free from added coaltar colouring matter, and any  other ingredient injurious to health. It shall also conform to the following standards, namely:- Total ash.-Not more than 8.0 per cent by weight (on dry basis). Ash insoluble in dilute hydrochloric acid.-Not more than 0.5  per cent by weight (on dry basis)."         

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Significantly, in this specification of standard the prescription is that  the article is "free from added coaltar colouring matter, and any other  ingredient injurious to health".  It is also required to conform to the  prescribed standard with regard to total ash.         As far as the rules made by the State Government are concerned, the  Maharashtra Prevention of Food Adulteration Rules, 1962 and the Goa,  Daman and Diu Prevention of Food Adulteration Rules, 1982 may be  noticed. The relevant Goa  rules are as under: "3.  Powers and duties of Food (Health) Authority: (1)     The Director of Health Services for the Union Territory of  Goa, Daman and Diu being the Chief Officer in charge of the  Health Administration in the Union  Territory shall be the Food  (Health) Authority. (2)     The Food (Health) Authority shall be responsible for the  general superintendence of the administration and enforcement  of the Act. (3)     The Food (Health) Authority shall, for the purpose of  giving effect to the provisions of the Act, have control over the  Public Health Laboratories maintained by the Government and  Local Authorities and Local (Health) Authorities, Licensing  Authorities, the Public Analyst and Food Inspectors appointed  under the Act. (4)     The Food (Health) Authority may give to a Local (Health)  Authority such directions as he may consider necessary in  regard to any matter connected with the enforcement of the Act  and the Rules made thereunder and the Local (Health) Authority  shall comply with such directions. (5)     The Food (Health) Authority whenever called upon to do  so shall advise the Government in matters relating to the  administration and enforcement of the Act. (6)(a)  If the Union Territory  or any part thereof is visited by, or  threatened with any outbreak of any infectious diseases, the  Food (Health) Authority shall ascertain the cause of such  outbreak of the infectious disease. (b)     If in the opinion of the Food (Health) Authority the  outbreak of any infectious disease is due to any article of food,  the Food (Health) Authority shall take such measures as it shall  deem necessary to prevent the outbreak of such disease or the  spread thereof. (7)  The Food (Health) Authority may issue from time to time  guidelines for the efficient working of the Act. (8) The Food (Health) Authority may from time to time issue  guidelines to the Public Analyst  for efficient working of the  Act. (9) The Food (Health) Authority may also have powers to  inspect, control and superintend the operation of other  functionaries working under the Act viz. Licensing Authority,  Local Authority etc. etc. 4.      Powers and duties of Local (Health)Authority:         (1)     Subject to the provisions of sub-rule (3), the Local  (Health) Authority shall be responsible for the proper day to  day administration and enforcement of the Act and the Rules  within its jurisdiction.         (2) The Local (Health) Authority or Health Officer/Medical  Officer authorised by it shall be the Licensing Authority for  local area concerned.         (3) The Local (Health) Authority or Health Officer/Medical  Officer/Food Inspector authorised by it shall have powers to  inspect all the establishments engaged in the manufacture, for  sale or for distribution of articles of food in respect of which a  licence is required under the Act and the Rules.

5.      Licences :         (1) Any person desiring for the manufacture for sale, for the  storage, for the sale or for the distribution of articles of food in

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respect of which a licence is required under Rule 48A and Rule  50 of the Central Rules, shall apply for a licence in Form A to  the Licensing Authority concerned.         (2)  Any person desiring for the manufacture for sale, for the  storage, for the sale or for the distribution of articles of food in  a mobile van shall apply in Form B to the Licensing Authority  and if such mobile van is to move in any one or more than one  local area to the Local (Health) Authority, District of Goa.

       (3) The applicant shall furnish in the application in Form A  detailed information regarding location of the business premises  which are intended for the manufacture for sale, for the storage,  for the sale or for the distribution of any article of food and in  Form B the details about the locality in which, the mobile van is  intended to be moved and its registration number issued by the  Road Transport Authority.  

       (4)     On receipt of such application, the Licensing Authority  shall, if on inspecting the said premises is satisfied that the  premises are free from sanitary defects and are  in  proper  hygienic conditions and the applicant complies with other  conditions for holding licence, grant the applicant a licence in  Form as specified below on payment of fees laid down in the  Schedule appended to the rules.

               (i) Form ’C’ in respect of any premises.                 (ii) Form ’D’ in respect of any mobile van.                 (iii) Form ’E’ in respect of any temporary stall.         (5)     If the information furnished in the application appears to  be incorrect or incomplete or if the prescribed fee has not been  paid, the Licensing Authority shall make such enquiry as he  considers necessary and after giving the applicant an  opportunity of proving the correctness and completeness of the  information so furnished,  may if he is satisfied that the  applicant is eligible for the licence applied for grant or renew  the licence. (6)     If the articles of food are manufactured,  stored or  exhibited for sale at different premises situated in more than  one local area, separate applications shall be made and a  separate licence shall be issued in respect of such premises not  falling within the same local area.         Provided that the itinerant vendors who have no specified place  of business, shall be licensed to conduct business in a particular  area within the jurisdiction of the Licensing Authority. (7)     The licensee shall abide by the provisions of the Act and  the Rules made thereunder and the conditions of licence granted  to him. 6.      Fees for grant and renewal of licences: The fees to be paid for the grant or renewal of licence shall be as  specified in the Scheduled appended to the Rules. 7.      Validity of licence:         A licence granted under these rules shall be valid for the period  beginning on the date of its issue and ending on 31st day of  March, next following. 8.      Renewal of licences :         A licence granted under the rules may be renewed by the  Licensing authority on an application made in that behalf, thirty  days before the day on which such licence  is due to expire and  on payment of fees specified in the Schedule.         Provided that, if the application for renewal is made after the  expiry of the licence but not later than one month from the date  of such expiry, the licence may be renewed only on payment of  a fee equal to one and half times of the fee payable for the  renewal of the licence. 9.      Conditions for grant or renewal of licences :

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       The Licensing Authority shall not grant or renew the licence  until such officer as may be specified by him by general or  special order has inspected the place in respect of which the  licence for grant or renewal is applied for and has  recommended the grant or renewal of the licence. The  Licensing Authority shall however use his own judgment in  granting/renewal of licences."

               Rule 13 deals with the circumstances under which the  Licensing Authority may by order in writing refuse to grant or renew a  licence. Rule 14 prescribes the procedure for cancellation or suspension of  the validity of a licence. Rule 15 gives a right to appeal to any person  aggrieved by an order of the Licensing Authority passed under rule 13 or  rule 14.  The relevant rules of the Maharashtra Prevention of Food  Adulteration Rules, 1962 are  as under: "3. Food (Health) Authority and its powers and duties - (1) The Director of Public Health for the State of Maharashtra  being the Chief Officer-in-charge of the Health Administration  in the State of Maharashtra shall be the Food (Health) Authority  (hereinafter referred to as the authority). (2) The authority shall be responsible for the general  superintendence of the administration and enforcement of the  Act.         ...         (6)(a)  If the State or any part thereof is visited by, or   threatened with an outbreak of any infectious disease, the  authority shall ascertain the cause of such outbreak of the  infectious disease.         (b)     If in the opinion of the authority the outbreak of any  infectious disease is due to any article of food, the authority  shall take such measures as it shall deem necessary to prevent  the outbreak of such disease or the spread thereof."                  Rule 5 deals with licences and the manner of suspension or  cancellation of licences.  Submissions : Ex visceribus actus:         The first contention urged on behalf of the appellants is that            Section 7 of the Act is not declaratory of the power of any authority, but  merely of the consequences of certain acts.  The section prohibits the  manufacture for sale, store or distribution of  (i) any adulterated food; (ii)  any misbranded food; (iii) any article of food for the sale of which a licence  is prescribed, except in accordance with the conditions of the licence; (iv)  any article of food the sale of which is for the time being prohibited by the  Food (Health) Authority in the interest of public health; (v) any article of  food in contravention of any other provision of this Act or of any rule made  thereunder; or (vi) any adulterant. Although, Section 2(vi) defines as to who  is a Food (Health) Authority,  there is no corresponding provision in the Act  which delineates the powers of the Food (Health) Authority.  On the other  hand, Section 24(2) of the Act empowers the State Government to "define  the powers and duties of the Food (Health) Authority, local authority and  Local (Health) Authority under this Act". The source of the powers of the  Food (Health) Authority is to be found only under the rules, if any, made  under Section 24(2) of the Act, subject to the restriction that it can be made  only "for the purpose of giving effect to the provisions of this Act in  matters not falling within the purview of Section 23".         Learned counsel for the appellants contend that in  view of the nature  of the limitations placed on the State Government’s power under Section  24(1), a reading of Sections 23 and 24 would lead to the irresistible  conclusion that the powers exercisable by the State Government under  Section 24 can only be in the field not occupied by Section 23.  As we have  already noticed, Section 23(1A)(f) empowers the Central Government to  prescribe rules for prohibiting the sale or defining the conditions of sale of  any substance which may be "injurious to health" when used as food or

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restricting in any manner its use as an ingredient in the manufacture of any  article of food or regulating by the issue of licences the manufacture for  sale of any article of food. Learned counsel, therefore, contend that the  power of the Food (Health) Authority has to be necessarily found under the  rules made by the State Government and subject to the limitation that they  cannot operate in the field covered by Section 23. Since Section 23(1A)(f)  empowers the Central Government to make rules for prohibition of any  substance which may be injurious to health, it is contended that the state  Food (Health) Authority is denuded of such power.         There appears to be merit in the contentions of the appellants. Rule 3  of the Maharashtra Prevention of Food Adulteration Rules, 1962 and the  corresponding rule in the Goa, Daman & Diu Prevention of Food  Adulteration Rules, 1982 suggest that the power given to the Food (Health)  Authority is only a pro tem power to deal with an emergent situation, such  as outbreak of any infectious disease, which may be due to any article of  food.  In such a contingency, the Food (Health) Authority is empowered to  take all such action as it deemed necessary to ascertain the cause of such  infectious disease and to  prevent the outbreak of such disease or the spread  thereof.  Certainly, such power would include the power to ban "for the  time being" the sale of such injurious articles of food. Hence,  correspondingly Section 7(iv) of the Act provides that no person shall  manufacture for sale, or store, sell or distribute "any article of food the sale  of which is for the time being prohibited by the Food (Health) Authority in  the interest of public health."  In other words, when a contingency  envisaged by Rule 3, or one similar thereto, arises and it becomes necessary  for the Food (Health) Authority to take immediate steps, the Food (Health)  Authority is empowered to prohibit "for the time being"  the concerned  injurious article and to take any appropriate step "in the interest of public  health".          On the collocation of the statutory provisions, we are unable to accept  the contention of the learned counsel for the States that clause (f) of Section  7 of the Act is an independent source of power.   This conclusion of ours is  also supported by the legislative history. Prior to the amendment by Act 49  of 1964, with effect from 1.3.1965, clause (iv)  of Section 7 read as under:         "Any article of food the sale of which is for the time  being prohibited by the Food (Health) Authority with a view to  preventing the outbreak or spread of  infectious diseases."

Learned counsel for the State Governments contend that as a result of  the amendment and the substitution of the words "in the interest of public  health" for the words "with a view to preventing the outbreak or spread of  infectious diseases", the legislature has expanded the power of Food  (Health) Authority so that it can act to prohibit the sale of any article, the  only limitation being that the power exercised is "in the interest of public  health".  It is not possible for us to accept this submission.  It is,  undoubtedly, true that the intention of Parliament in bringing forth the  amendment to clause (iv) of Section 7 was to expand the area of operation  of the said clause.  As originally intended, it was to operate only in the  event of  a contingency aimed at preventing the outbreak or spread of  infectious diseases. This certainly was restricted. There could be several  situations in which there may not be any apprehension  of outbreak or  spread of infectious diseases and yet it may become necessary for the Food  (Health) Authority to act by taking appropriate steps to control a situation  which has arisen.  It is with this view that the prohibition in clause (iv) of   Section 7 of the Act was expanded to apply to such contingencies also.   It is unfortunate that, despite the  amendment made in clause (iv) of  Section 7 of the Act, (by Act 49 of 1964) the rules have not been  correspondingly updated.  Going strictly by the state  rules, which actually  determine the extent of the power of the Food (Health) Authority, it  appears to us that the arguments of the State Governments that this  amendment was  intended to give a carte blanche to the Food (Health)  Authority cannot be accepted. On the contrary, the construction canvassed  by  the appellants appears to be more reasonable.  We are inclined to the  view that the power of the state authority, which is discernible under  Section 24(2)(a) read with the state rules, operates only for a temporary

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period during which an emergent situation exists which needs to be  controlled. It is not possible to accept the State Governments’ contention  that clause (iv) of Section 7 of the Act is an independent provision which  clothes the Food (Health) Authority with the power to issue an order of ban  for a long period. Mr. Lalit, learned counsel for the state of Maharashtra, took us  through the affidavit filed by the state Government and the voluminous  data presented therein by the state to indicate that gutka and pan masala are  addictive and, in the long run, deleterious to human health.  He also  referred to certain scientific reports on the subject by the National  Toxicology Centre, an International Agency for Research on Cancer, part  of the World Health Organisation, and so on.  In our view, it is not  necessary to make any pronouncement thereupon. Even if we accept that  the scientific data supports the view that chewing of pan masala with or  without tobacco is injurious to health, the question which remains to be  answered is whether the Food (Health) Authority in the state has the power  of prohibiting the manufacture for sale, or storage, sale or distribution of  any article assuming it to be injurious to health. A contrast of the powers of  the Central Government with those of the state Government, with  particular reference to the power of the Central Government to make rules  to prohibit the manufacture, sale and distribution of such articles which are  injurious to health when used as food, enumerated in clause (f) of sub- section(1A) of Section 23 of the Act, leads us to believe that, even  assuming that gutka and tobacco products are injurious to health, the power  of their prohibition is only vested with the Central Government and not  with the state Food (Health) Authorities.  The State (Food) Health  authorities have only a limited power of issuing an order of prohibition for  a short term while they investigate local problems and take appropriate  measures to control the situation. Beyond that, the state authorities have no  power as urged by the learned counsel for the state Governments and as  accepted in the impugned judgment of the Bombay High Court. It is an accepted canon of Construction of Statutes that a statute must  be read as a whole and one provision of the Act should be construed with  reference to other provisions of the same act so as to make a consistent,  harmonious  enactment of the whole statute.  The court must ascertain the  intention  of the legislature by directing its attention not merely to the  clauses to be construed, but to the scheme of the entire statute. The attempt  must be to eliminate conflict and to harmonise the different parts of the  statute for it cannot  be assumed that Parliament had given by one hand  what it took away by the other. [See in this connection Commissioner of  Income Tax  v.  Hindustan Bulk Carriers  and  C.I.T. Central,  Calcutta  v.  National Taj Traders .]  This Court in O.P. Singla and  Anr.  v.  Union of India and Ors.  (vide para 17),  said: "However, it is  well recognised that, when a rule or a section is a part of  an integral  scheme, it should not be considered or construed in isolation. One must  have regard to the scheme of the fasciculus of the relevant rules or sections  in order to determine the true meaning of any one or more of them.  An   isolated consideration of a provision leads to the risk of some other inter- related provision becoming otiose or devoid of meaning." Against the background of these principles, it is not possible to agree  with the view taken by the High Court that Section 7(iv) of the Act is an  independent source of power of such  amplitude as held. In our view, the  power of the state under Section 7(iv) of the Act is statutory; absolute to  the extent provided therein, and limited to the extent indicated by Section  23(1A) of the Act. Learned counsel for the appellants urged that the expression "for the  time being" used in clause (iv) of Section 7 of the Act is significant and  indicates the transient nature of the power that is conferred on the Food  (Health) Authority under the rules to ban or otherwise take any other  appropriate action in relation to an article of food even if it be "in the  interest of public health". This too lends support to their contention.   Learned counsel for the state of Maharashtra and the learned Advocate  General for the state of Goa relied on the judgments of this Court in  Pukhraj Jain  v.  Padma Kashyap and Anr.   and Jivendra Nath Kaul   v.  Collector/District Magistrate and Anr.  to contend that the expression

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"for the time being" would suggest the time period for which the order is in  force and not necessarily the transient nature of the order. Even if this be  correct, the fact still remains that the state authority has no power to make  an order of prohibition, either of a permanent nature or enduring for such a  long time as to be deemed to be permanent. Contemporanea expositio: The appellants  point out that, despite the amendment having been  made in the year 1964, even the state of Maharashtra kept on  corresponding with the Central Government to suggest that it was  necessary to carry out an amendment in the law to enable it to permanently  ban the article concerned.  Reliance is placed on pp. 152 - 154, Vol. II of   S.L.P. No. 834 of 2003, the annexure to the counter affidavit filed by F.K.  Pandey on behalf of the Government of India.  Particular reference is made  to the letter dated 1st August, 1997 from the Commissioner, Food and Drug  Administration and Food (Health) Authority to the Secretary, Medical  Education and Drug Department, Mumbai about the ill-effects of gutka and   requesting the state Government to amend the Maharashtra Prevention of  Food Adulteration  Rules and also to make a request to the Central  Government to amend the Prevention of Food Adulteration  Act so as to  enable the state of Maharashtra to exercise the powers of a permanent ban.   While this may not be really conclusive, it   certainly indicates the manner  of the state authority viewing its power and the rules under which it was  exercising the power. The court can certainly take into account this  situation on the doctrine of Contemporanea  expositio.  It  is significant that, while dealing with the powers of food inspector  under Section 10(1)(c) of the Act, the Act provides that a food inspector  shall have power, with the previous approval of the Local (Health)  Authority having jurisdiction in the local area concerned, or with the  previous approval of the Food (Health) Authority, to prohibit the sale of  any article of food in the interest of public health. Secondly, this clause  does not include the phrase "for the time being". If the arguments of the  learned counsel for the state Governments were to prevail, then this  provision would give to the food inspector, a lower authority in the  hierarchy, an extraordinary power of banning  permanently  - which power  can only be the result of  a policy decision to be taken at the highest level  of the state Government.  In our view, it is not possible to interpret these  clauses disparately or disjunctively.  Clause (iv) of Section 7 and clause (c)  of  sub-section (1) of Section 10 of the Act and their interplay  unmistakably suggest that the power conferred on the Food (Health)  Authority and the food inspector, being derived from the Rules made in  exercise of the powers exercised under Section 24 of the Act are  necessarily subservient to the powers derivable from the rules made under  Section 23 of the Act.  Hence, neither the Food (Health) Authority, nor the  food inspector can be said to have  such power which could be available to  the Central Government by prescription of a rule in exercise of power  under Section 23(1A)(f).   Reliance was placed by the respondents on the decision of a learned  Single Judge in Gandhi Irwin Salt Manufacturers Association   v.  The  Government of Tamil Nadu . Having perused the judgment, we are  unable to approve of it. We notice that neither the interplay between  Sections 23 and 24, nor the question as to whether Section 24 can be the  source of power, is discussed or decided therein. Conflict with Central Act 34 of 2003:

Mr. Nariman, learned counsel appeared for the appellants in the  appeals arising out of SLP Nos. 23635 of 2002 and 533 of 2003, attacked  the judgment of the Bombay High Court from a different perspective.  He    contends  that the Cigarettes and Other Tobacco Products (Prohibition of  Advertisement and Regulation of Trade and Commerce, Production,  Supply and Distribution) Act, 2003,  (Act 34 of 2003),  referable to entry  52, List I and entry 18, List III to the Seventh Schedule of the Constitution  of India, now occupies the entire field in relation to tobacco. The preamble  to the Act 34 of 2003 reads as under: " An Act to prohibit the advertisement of, and to provide for the  regulation of trade and commerce in, and production, supply

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and distribution of, cigarettes and other tobacco products and  for matters connected therewith or incidental thereto"

The Statement of Objects and Reasons accompanying the Bill reads  as under: "1. Tobacco is universally regarded as one of the major  public health hazards and is responsible directly or  indirectly for an estimated eight  lakh deaths annually in  the country.  It has also been found that treatment of  tobacco related diseases and the loss of productivity  caused therein cost the country almost Rs.13,500/- crore  annually, which more than offsets all the benefits  accruing in the  form of revenue and employment  generated by tobacco industry.  The need for a  comprehensive legislation to prohibit advertising and  regulation of production, supply and distribution of  cigarettes and tobacco products was recommended by  the Parliamentary Committee on Subordinate Legislation  (Tenth Lok Sabha) and a number of points suggested by  the Committee on Subordinate Legislation have been  incorporated in the Bill.

2.       The proposed Bill seeks to put total ban on  advertising of cigarettes and other tobacco products and  to prohibit sponsorship of sports and cultural events  either directly or indirectly as well as sale of tobacco  products to minors. It also proposes to make rules for the  purpose of prescribing the contents of the specified  warnings, the languages  in which they are to be  displayed, as well as displaying the quantities of nicotine  and tar contents of these products. For the effective  implementation of the proposed legislation, provisions  have been proposed for compounding minor offences  and making punishments for offences by companies  more stringent.  The objective of the proposed enactment  is to reduce the exposure of people to tobacco smoke  (passive smoking) and to prevent the sale of tobacco  products to minors and to protect them from becoming  victims of misleading advertisements. This will result in  a healthier life style and the protection of the right to life  enshrined in the Constitution. The proposed legislation  further seeks to implement article 47 of the Constitution  which, inter alia, requires the State to endeavour to  improve public health of the people. 3. The Bill seeks to achieve the aforesaid objects."

The  aforesaid internal evidence in the statute, by reason of the  preamble, and the external evidence in the Statement of Objects and  Reasons, indicate that Parliament has evinced its intention to bring out a  comprehensive enactment to deal with tobacco and tobacco products.  However, the provisions of the statute do not suggest that Parliament had  considered it to  be expedient to ban tobacco or tobacco products in public  interest or to protect public health.  Act 34 of 2003  passed by Parliament  does not totally  ban the manufacture of tobacco or tobacco products.   Section 6 merely prohibits sale of cigarettes and tobacco products to a  person under the age of eighteen years. There are stringent provisions  made in the Act containing the prohibition of advertisement of cigarettes  and tobacco products.  Section 3(p) defines the expression "tobacco  products" as the products specified in the Schedule. Entry 8 of the  Schedule to the Act reads "pan masala or any chewing material having  tobacco as one of its ingredients (by whatever name called)." Thus, pan  masala or any chewing material having tobacco is also one of the products  in respect of which the Act could have imposed a total prohibition, if  Parliament was so minded. On  the  other hand, there is only conditional  prohibition of these products against sale to persons under eighteen years

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of age. Against this backdrop of Act 34 of 2003, learned counsel contended  that inasmuch as Act 34 of 2003 occupies the whole field of tobacco and  tobacco products and does not completely ban the sale of ’tobacco  products’ except to under aged persons, while the impugned notification  expressly bans manufacture or  sale to any person of the very same product  (viz. Pan masala and gutka), there is legislative repugnancy which calls for  resolution. Reliance was placed on the judgment of this Court in Deep  Chand  v.  The State of U.P. and Ors.  wherein  this Court considered the  constitutional validity of a state enactment. This Court’s earlier judgment  in Ch. Tika Ramji & Ors.  v.  The State of U.P. & Ors.   and Zaverbhai  Amaidas  v.  The State of Bombay  were approved and the  test of  repugnancy was  formulated thus: "Repugnancy between two statutes may thus be ascertained on  the basis of the following three principles (1) Whether there is direct conflict between the two provisions; (2) Whether Parliament intended to lay down an exhaustive  code in respect of the subject matter replacing the Act of the  State Legislature; and  (3) Whether the law made by Parliament and the law made by  the State Legislature occupy the same field."

Learned counsel contended that when two legislations referable to the  same legislative authority are inconsistent with each other, then the later  enactment is deemed to have impliedly repealed the previous one and  referred to the observations of this Court in State of Orissa  v.  M.A.  Tulloch and Co. : "The  entire theory underlying implied repeals is that there is no  need for the later enactment to state in express terms that an  earlier enactment has been repealed by using any particular set  of words or form of drafting but that if the legislative intent to  supersede the earlier law in manifested by the enactment of the  provisions as to effect such supersession, then there is in law a  repeal notwithstanding the absence of the word ’repeal’ in the  later statute.  Now, if the legislative intent to supersede the  earlier law is the basis upon which the doctrine of implied repeal  is founded could there be any incongruity in attributing to the  later legislation the same intent which s. 6 presumes where the  word ’repeal’ is expressly used.  So far as statutory construction  is concerned, it is one of the cardinal principles of the law that  there is no distinction or difference between an express  provision and a provision which is necessarily implied, for it is  only the form that differs in the two cases and there is no  difference in intention or in substance."

The learned counsel relied on Vijay Kumar Sharma & Ors.  v.   State of Karnataka and Ors. . The observation of this Court in the  majority judgment of this Court  is that if the later legislation is on the  same subject and the legislative intent is to occupy the whole field, then the  later legislation prevails. It is submitted that a reading of the Act 34 of 2003  clearly suggests  that it is a special law intended to deal with tobacco and its product.  The  Prevention of Food Adulteration Act, 1954 is a general law  dealing with  adulteration of food articles and a tobacco product is incidentally referred  to in the said law in the context of prevention of adulteration.  In case of   conflict between a special law and a general law, even if both  are enacted  by the same legislative authority, the special law must displace the general  law to the extent of inconsistency. The operation of the maxim generalia  specialibus non derogant has been approved and applied by this Court in  such situations. (See in this connection:  U.P. State Electricity Board and  Ors.  v.  Hari Shanker Jain & Ors. , Gujarat State Cooperative Land  Development Bank Ltd.  v.  P.R. Manded and Ors. , The LIC of India   v.  D.J. Bahadur & Ors. ,  Jain Ink Manufacturing Co.  v.  LIC of  India & Anr. ,  Prof. Sumer Chand  v.  Union of India and Ors.  and  Allahabad Bank  v.  Canara Bank & Anr. .)

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Respondents contend that inasmuch as Act 34 of 2003, though passed  by Parliament, and assented to by the President, is not brought into force  by the Central Government by notification, the question of conflict with  the provisions of the Act does not arise. We need not consider this  contention since Act 34 of 2003  has now been brought into force w.e.f.     1st May, 2004. In any event, as pointed out in Pt. Rishikesh and another  v. Salma Begum   there is distinction between "making law" and  "commencement of the operation of an Act" and a situation of conflict can  arise even when a law has been made and not brought into force. Articles 14 and 19 of the Constitution of India: Mr. Shanti Bhushan, learned counsel for the appellant in SLP No.  2186 of 2003, urged that the said appellant manufactures Rajnigandha pan  masala which contains no tobacco. Though there might be arecanut in it,  there is no trace of magnesium carbonate in the product.  Assuming  that  traces of magnesium carbonate were to be formed during consumption of  the product along with lime, the exercise of power should have been  restricted to banning pan masala containing magnesium carbonate and not  wholesale  banning of pan masala, irrespective of the content of  magnesium carbonate.  The learned counsel contended that the order made  under Section 7(iv) of the Act is bad for it is an unreasonable and excessive  restriction on the Fundamental Right to carry on trade or business  guaranteed under Article 19(1)(g) of the Constitution of India. The learned  counsel highlighted the unreasonableness by reference to the provisions of  the Act and the Rules and the specific situation contemplated in Appendix  B at Paragraph A.25.02.01, which gives the definition and standards of  quality with reference to chewing gum and bubble gum, for which   magnesium carbonate, inter alia, is a permitted ingredient.  He therefore   contends  that magnesium carbonate is not per se injurious to health for  otherwise it would never have been permitted in any article of food.  There  is no material on the basis of which it can be demonstrated that the very  same magnesium carbonate would become injurious to health if it arises on  account of mixing of traces of magnesium in arecanut and carbonate in  lime  According to the learned counsel, this is a clear case of non-                                                                                                                                                                                                                                     application of mind, notwithstanding the medical research papers and data  made available in the affidavit filed by the state Government.  We are unable to discern as to how the very same magnesium  carbonate would become injurious as a result of combined chewing of  arecanut and lime, particularly when it is not the case of the state  Government that Rajnigandha pan masala itself contains magnesium  carbonate.  It is permissible under Article 19(6) to impose a reasonable  restriction "in the interest of general public". Assuming that such a  restriction can be imposed, even if by legislation intended to             prohibit manufacture, sale or storage of articles harmful or    injurious        to health, the restriction has to be commensurate with the danger posed.   On  a  conspectus  of the facts,  we  are unable to uphold                           the prohibition imposed by the impugned notification as a restriction which  can pass the test of reasonableness under Article 19(6) of the Constitution  of India for two reasons.  First, there is no demonstrated danger to the  public health by magnesium carbonate by consumption of Rajnigandha pan  masala; secondly, even if there were, the prohibition could only have  extended to pan masala containing magnesium carbonate and could not be  wider than that. Learned counsel for the appellants urge that if Section 7(iv) is  construed in the manner as contended by the State, then it would become  unconstitutional.  It is contended that if Section 7(iv) is construed as giving  the authority to ban articles of food, even though not adulterated, then the  sweep of the section would go out of  entry 18 of List III of the  Constitution of India.    ("adulteration of foodstuffs and other goods.") and  intrude into the domain of entry 6 of List II   ("public health and sanitation;  hospitals and dispensaries") which is the exclusive domain of the state  Government. If the court were to read Section 7(iv) in the manner  suggested by the States, then it would be ultra vires the legislative

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competence of Parliament. It is the duty of the court to attempt to read  every legislation in such manner as to uphold its constitutional validity.  The learned counsel contend that in order to uphold the legislative  competence of the provisions of the Act,  the sweep of Section 7(iv) must  be confined to the domain of ’adulteration of food stuffs and other articles’  without entering into the domain of "public health".  Reading down the  statute in order to upheld its constitutional validity is a device well known  to the constitutional courts.  [See in this connection  State of Karnataka  and Anr.   v.  Shri Ranganatha Reddy & Anr. ,  B.R. Enterprises and  Ors.  v.  State of U.P. and Ors. ,  and State of A.P.  v.  National  Thermal Power Corpn. Ltd. and Ors. ]  Mr. Lalit, learned counsel for the States, however, supported the  findings of the division bench of the Bombay High Court that the  constitutional validity of Section 7(iv) was never in danger as it could be  supported on the doctrine of  pith and substance. He contends that in pith  and substance the Prevention of Food Adulteration Act, 1954 deals with  the subject of adulteration, though, incidentally, by reason of Section 7(iv)  it may make an incursion  into the domain of "public health" which is the  exclusive province of the State legislature.  This contention appears to have  been accepted by the impugned judgment of the High Court of Bombay.   In fact, the High Court goes to the extent of saying that the power of the  Food (Health) Authority under Section 7(iv) is much wider than the power  of the Central Government under the Rules made under Section 23(1A)(f)  on the reasoning that while the power of the Central Government under a  rule made under Section 23(1A)(f) extends to the prohibition of the sale of  "any substance which may be injurious to health when used as food or as  an ingredient in the manufacture of any article of food" there  is no such  restriction under Section 7(iv) which is posited as an independent source of  power. It is urged that by exercise of the power invested in the Food  (Health) Authority under clause (iv) of Section 7, any article, irrespective  of whether it is used as food or as an ingredient in the manufacture of any  article of food, may be prohibited  as long as the prohibition is "in the  interest of public health". We find it difficult to agree with the submissions of Mr. Lalit. That  all provisions of a statute have to be read harmoniously and any  interpretation as to be ex visceribus actus, is a trite doctrine of construction  of statutes.  Undoubtedly, if  Section 7(iv) is read in isolation, it gives the  impression that this is an independent source of power, not subject to any  limitation other than the guideline "in the interest of public health". But,  when the scheme of the Prevention of Food Adulteration Act is analysed in  the light of its preamble and the Statement of Objects and Reasons, it  becomes clear that there is no independent source of power under Section  7(iv).  Had it been so, there was no need for the rule making power of the  State Government under Section 24(2)(a) to define the powers and duties  of the Food (Health) Authority or local authority and Local (Health)  Authority under the Act.  The interplay of sections 23(1A)(f) and 24(2)(a)  read with the existing rules in the different states, even after the  amendment of Section 7(iv) by the Act 49 of 1964, leads us to conclude  that the contention of the states in this regard  cannot be accepted. Learned counsel for the appellants contend that the impugned  notification is violative of the fundamental rights guaranteed  under   Article 19(1)(g) as it is excessively  restrictive in nature.  While the  notification seeks to ban pan masala which does not include tobacco, it  does not at the same time ban tobacco in any form.  The literature produced  by the State of Maharashtra before the High Court suggested, undoubtedly,  that consumption of tobacco in any form was injurious to health, but that  consumption of pan masala was likely to be addictive and lead to hyper-  magnesia.  Strangely, the States did not ban chewing tobacco or other  tobacco products which contain almost cent per cent tobacco, but they  banned the sale of gutka which contains only about 6 per cent of tobacco  and pan masala, which contains no tobacco whatsoever, even accepting on  the correctness of the material presented.  Further, the literature produced  by the States indicates that pan masala is addictive amongst children and,  therefore, likely to be injurious to their health in the long run.  Assuming  this to be true, the restriction could only have been on sale to under-aged

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persons and not by way of a total ban.  Thus, in  our view, the impugned  notification is violative of the fundamental right of the appellants  guaranteed under Article 19(1)(g),  both because it is unreasonable and  also because it is excessive in nature.  A contrast with the provisions of the  Act 34 of 2003 in this regard would drive home the point.  While dealing with the nature of a  reasonable restriction on the  fundamental rights under Article 19(1)(g), this Court observed in Mohd.  Faruk  v.  State of Madhya Pradesh and Ors.  as under: "The impugned notification, though technically within the  competence of the State Government, directly infringes the  fundamental right of the petitioner guaranteed by Art. 19(1)(g),  and may be upheld only if it be established that it seeks to  impose reasonable restrictions in the interest of the general  public and a less drastic restriction will not ensure the interest  of the general public.  The  Court must in considering the  validity of the impugned law imposing a prohibition on the  carrying on of a business or profession, attempt an evaluation of  its direct and immediate impact upon the fundamental rights of  the citizens affected thereby and the larger public interest  sought to be ensured in the light of the object sought to be  achieved, the necessity to restrict the citizen’s freedom, the  inherent pernicious nature of the act prohibited or its capacity or  tendency to be harmful to the general public, the possibility of  achieving the object by imposing a less drastic restraint, and in  the absence of exceptional situations such as the prevalence of a  state of emergency - national or local - or the necessity to  maintain essential supplies, or the necessity to stop activities  inherently dangerous, the existence of a machinery to satisfy the  administrative authority that no case for imposing the restriction  is made out or that a less drastic restriction may ensure the  object intended to be achieved."

       The impugned notification fails on this test of reasonable restriction.  Res extra commercium: Appellants next contend that the assumption of the High Court that  pan masala or gutka is res extra commercium  is wholly incorrect.  The concept of res extra commercium was expounded in the  Constitutional Bench of this Court in Khoday Distilleries Ltd. and Ors.   v.  State of Karnataka and Ors.  thus:  "58.  We also do not  see any merit in the argument that there  are more harmful substances like tobacco, the consumption of  which is not prohibited and hence there is no justification for  prohibiting the business in potable alcohol. What articles and  goods should be allowed to be produced, possessed, sold and  consumed is to be left to the judgment of the legislative and the  executive wisdom. Things which are  not considered harmful  today, may be considered so tomorrow in the light of the fresh  medical evidence. It requires research and education to  convince the society of the harmful effects of  the products  before a consensus is reached to ban its consumption.  Alcohol  has since long been known all over the world to have had  harmful effects on the health of the individual and the welfare  of the society. Even long before the Constitution was framed, it  was one of the major items on the agenda of the society to ban   or at least to regulate, its consumption.  That is why it found  place in Article 47 of the Constitution. It is only in recent years  that medical research has brought to the fore the fatal link  between smoking and consumption of tobacco and cancer,  cardiac diseases and deterioration and tuberculosis.  There is a  sizeable movement all over the world including in this country  to educate people about the dangerous effect of tobacco on  individual’s health. The society may, in course of time, think of  prohibiting its production and consumption as in the case of  alcohol.  There may be more such dangerous products, the  harmful effects of which are today unknown. But merely

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because their production and consumption is not today banned,  does not mean that products like alcohol which are proved  harmful, should not be banned. .  .  .  .  . 60(b)   The right to practise any profession or to carry on any  occupation, trade or business does not extend to practising a  profession or carrying on an occupation,  trade or business  which is inherently vicious and pernicious, and is condemned  by all civilised societies.  It does not entitle citizens to carry on  trade or business in activities which are immoral and criminal  and in articles or goods which are obnoxious and injurious to  health, safety and welfare of the general public, i.e., res extra  commercium, (outside commerce). There cannot be business in  crime."

Is the consumption of pan masala or gutka (containing tobacco), or  for that matter tobacco itself, considered so inherently or viciously  dangerous to health, and, if so, is there any legislative policy to totally ban  its use in the country ?  In the face of Act 34 of 2003, the answer must be in  the negative.  It is difficult to accept the contention that the substance  banned by the impugned notification is treated as res extra commercium. In  the first place, the gamut of legislation enacted in this country which deals  with tobacco does not suggest that Parliament has ever treated it as an  article res extra commercium, nor has Parliament attempted to ban its use  absolutely.  The Industries (Development and Regulations) Act, 1951  merely imposed licensing regulation on tobacco products under item  38(1)  of  the First Schedule. The Central Sales Tax Act, 1956 in Section 14(ix)  prescribes the rates for Central Sales Tax.  Additional Duties of Excise  (Goods of Special Importance) Act, 1957 prescribes the additional duty  leviable on tobacco products. The Tobacco Board Act, 1975 established a  Tobacco Board for development of tobacco industries in the country. Even  the latest Act, i.e. the Cigarettes and Other Tobacco Products (Prohibition  of Advertisement and Regulation of Trade and Commerce, Production,  Supply and Distribution) Act, 2003, does not ban the sale of tobacco  products listed in the Schedule except to minors.  Further, we find that in  the tariff schedule of the Central Sales Tax Act, there are several entries  which deal with tobacco and also pan masala.  In the face of these  legislative measures seeking to levy restrictions and control the  manufacture and sale of tobacco and its allied products as well as pan  masala, it is not possible to accept that the article itself has been treated as  res extra commercium.  The legislative policy, if any, seems to be to the  contrary.  In any event, whether an article is to be prohibited as res extra  commercium is a matter of legislative policy and must arise out of an Act of  legislature and not by a mere notification issued by an executive authority.  Need to read down:          There is also merit in the contention of the appellants that if the  provisions of Section 7(iv) of the Act are not read down as conferring  powers on the authority to deal with an emergent situation, the section  would be conferring arbitrary powers on the authority and would be  procedurally unfair.  This is particularly so in the face of the statutory  provision under which  licences have already been granted to the  manufactures of pan masala and gutka for manufacture of the articles.   There is already a provision in the statutory scheme for cancellation and  suspension of a licence. Without going through such procedure, the power  in the state authority to suddenly  bring out the result of cancellation or  suspension of the licence,  without procedural safeguards,  would certainly  be arbitrary and liable to be hit by Article 14 of the Constitution of India.   For this reason also, the power under Section 7(iv) needs  to be read down  as conferring powers on the authority only to deal with an emergent  situation.         There has been some argument at the Bar as to whether the impugned  notification is the result of an executive act or a legislative act.  We have  already indicated that, in our view, Section 7(iv) is not an independent   source of power. The notification can only be issued by the authority the  source of whose power must be located elsewhere. Section 7(iv) merely

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indicates the consequences which would flow if a valid notification is  issued.  It is, therefore, not necessary for us to go into the niceties between  an executive and a legislative act.         Mr. Anil Divan, learned counsel appearing for one of the appellants,  pointed out that the Central Sales Tax Act by Section 14(ix) recognises  gutka as a legitimate article of interstate trade or interstate sale.  So is pan  masala recognised as such a legitimate article of interstate sale.  The  learned counsel relied on M/s Dwarka Prasad Laxmi Narain  v.  The  State of U.P. and Ors.  to contend that a law or order which confers  arbitrary or uncontrolled power on the executive in the matter of regulating  trade or commerce in normally available commodities must be held to  unreasonable. [See also in this connection the observations of this Court in  B.B. Rajwanshi  v.  State of U.P. and Ors. ]         Learned counsel highlighted the observations of this Court in  Maneka Gandhi  v.  Union of India  and contended that irrespective of  whether the power to issue the impugned notification is a legislative power  or an executive power, it must pass the test of fairness in procedure.  Any  provision of law  which enables to an authority by a notification to bring to   standstill a business, which is otherwise permitted by law, must be held to  be arbitrary; unfair and an abridgment of the fundamental rights guaranteed  under Article 14 of the Constitution. [See also in this connection Kanti Lal  Babulal  v.  H.C. Patel , Ajay Hasia and Ors.  v.  Khalid Mujib  Sehravardi and Ors.  and Delhi Transport Corporation  v.  D.T.C.  Mazdoor Congress and Ors. ]         It is in the light of these authorities that we are required to adjudge the  constitutionality of the interpretation put on Section 7(iv).          Learned counsel for the States, however, urge that the impugned  notification is a legislative act and not an administrative act.  Thus,  according to them, there is no question of giving a hearing before taking a  policy decision to ban the manufacture for sale, storage, sale and  distribution of pan masala and gutka.   We are unable to accept the contention of the States.  In our view, the  scheme of the Act suggests that a decision to ban an article injurious to  health, when used as food or as an ingredient in the manufacture of any  article of food, can only be the result of broader policy. Hence, this larger  power appears to have been located only in the Central Government under  Section 23(1A)(f) and not in the state Food (Health) Authority.  As we have  already pointed out, the power of the state Food (Health) Authority is only  transitory in nature and designed to deal with local emergencies.  In our  considered view, the impugned notification is certainly an administrative  act and not a legislative act.  Inasmuch as by an executive act the  manufacture for sale, storage, sale or distribution of the concerned article  has been banned so as to interfere with the fundamental rights of the  appellants guaranteed under Articles 14 and 19 of the Constitution of India,  the impugned notification is illegal and unconstitutional.         We are unable to accept that the words "in the interest of public  health" used in clause (iv) of Section 7 of the Act can operate as an  incantation or mantra to get over all the constitutional difficulties posited.   In any event, the collocation of the words in the statutory scheme suggests  not a matter of policy, but a matter of implementation of policy.  For this  reason also, we are of the view that the impugned notification must fail.         The learned Advocate General for the State of Goa contended that in  the State of Goa, apart from the impugned notification dated 24th January,  2003, there is a subsequent notification dated 7th April, 2003 which is not  impugned by the appellants. Reliance is placed on a judgment of the  division bench of the Bombay High Court in Vaman Raghunath Fallary  & Sons and Ors.  v.  State of Goa and Ors. .  The division bench in the  said decision  seems to have been overwhelmed by  the material produced  with regard to the hazardous nature of pan masala with tobacco and taken  the view that the State Government was justified in taking a decision to ban  tobacco  products  within  the  realm  of  such  policy decision. The division  bench has not addressed itself to any of the sections of the Act which   decide the powers. The learned Advocate General for the State of Goa  contends that matters of public health are essentially matters of policy  decision, legislative or administrative, planned and executed in the greater

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interest of public health by the Government and the court should not  interfere with such policy matters. He relied on the observations of P.N.  Krishna Lal and Ors.  v.  Govt. of Kerala and Anr.   wherein this Court  said: "24. The raison d’etre of the State being the welfare of the  members of the society, the whole purpose of the creation of  the State would be to maintain order, health and morality by  suitable legislation and proper administration.  The State has  the power to prohibit trade or business which are illegal,  immoral or injurious to the health and welfare of the people.   No one has the right to carry on any trade or occupation or  business which is inherently vicious and pernicious and is  condemned by all civilized societies. Equally no one could  claim entitlement to carry on any trade or business or any  activities which are criminal and immoral or in any articles of  goods which are obnoxious ad injurious to the safety and health  of general public.  There is no inherent right in crime.   Prohibition of trade of business of noxious or dangerous  substances or goods by law is in the interest of society  welfare."          There is a plethora of legislation dealing with tobacco products,  gutka and pan masala and the fact that licences have been issued to the  appellants to manufacture the concerned articles, which does not lead to  the conclusion that the trade or business in the concerned articles is an  activity which is "criminal in propensity, immoral, obnoxious, injurious to  the health of general public" or that the ban is a result of ’public  expediency and public morality’. Is it food ?          Mr. Nagaraja, learned counsel appearing for the petitioners in writ  petition No. 173 of 2003, raised a further contention that pan masala or  gutka which is the subject matter of the impugned notification does not  amount to food within the meaning of its definition in Section 2(v) of the  Act. Section 2(v) of the Act reads as under: "2. (v)  "food" means any article used as food or drink for  human consumption other than drugs and water and includes- (a)     any article which ordinarily enters into, or is used in the  composition or preparation of , human food, (b)     any flavouring matter or condiments, and  (c) any other article which the Central Government may, having  regard to its use, nature, substance or quality, declare, by  notification in the Official Gazette, as food for the purposes of  this Act."

       In his submission, the expression "food" as defined in the Lexicon  could only be "a substance taken into the body to maintain life and  growth".  No one in his right mind would consider that pan masala or gutka  would be consumed for maintenance and development of health of human  being.  In P.K. Tejani  v.  M.R. Dange ,  this Court held that the word  "food" is a very general terms and applies to all that is eaten by men for  nourishment and takes in also subsidiaries. Since pan masala, gutka or   supari are eaten for taste and nourishment, they are all food within the  meaning of Section 2(v) of the Act.              The learned counsel relied on a judgment of a division bench of this  Court in C.A. No. 12746-12747 of 1996 (decided on 6th November, 2003).   In our view, this judgment is of no aid to us. In the first place, this  judgment arises under the provisions of the  Essential Commodities Act,  1955, read with the Tamil Nadu Scheduled Articles (Prescription of  Standards) Order, 1977 and the  notification dated 9th June, 1978, issued by  the Central Government which laid down certain specifications "in relation  to foodstuffs". The question that arose before the Court was whether tea is   ’foodstuff’  within the meaning of the said legislation.  The division bench  of this Court came to the conclusion that ’tea’ is not food as it is not  understood as ’food’ or ’foodstuff’ either in common parlance or by the  opinion of  lexicographers. We are unable to derive much help from this  judgment for the reason that we are not concerned with tea.  It is not

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possible to extrapolate the reasoning of this judgment pertaining to tea into  the realm of pan masala and gutka. In any event, the judgment in Tejani   (supra) was a judgment of the Constitutional Bench which does not seem  to have been noticed.         We are, therefore, unable to agree with the contention that pan  masala or gutka does not amount to "food" within the meaning of  definition in Section 2(v) of the Act. However,  we do not rest our decision  solely on this issue. Paradoxical consequence:         There is yet another reason why we are inclined to take the view that  Section 7(iv) deals with a situation of emergency with respect to the local  area.  A decision for banning an article of food or an article containing any  ingredient of food injurious to health can only arise as a result of broadly  considered policy.  If such a power be conceded in favour of a local  authority like the Food (Health) Authority, paradoxical results would arise.  The same article could be considered injurious to public health in one local  area, but not so in another.  In our view, the construction of the provision  of the statute must not be such as to result in such absurd or paradoxical  consequences.  Hence, for this reason also, we are of the view that the  power of the State (Health) Authority is a limited power to be exercised  locally for temporary duration. Width of power:         The learned counsel for the state of Maharashtra contended that the  power of the Food (Health) Authority discernible in clause (iv) of Section  7 of the Act is an independent power and much wider than the power of the  Central Government under Section 23 of the Act.  He contended that while  the power of the Central Government discernible from Section 23(1A)(f)   is restricted only to prohibiting the manufacture or sale of articles of food  or ingredients of food, the power of the state Food (Health) Authority is  much wider and could extend even to articles which may not amount to  food or ingredients of food, or even if they are not injurious to health, as  long as the test of  "in the interest of public health" is satisfied.  In our view, this is an argument of desperation.  We cannot conceive  of such wide ranging power vested in a local authority without there being  sufficient guidelines as to the manner of deciding the policy and  implementing it and elucidated in the statute itself.  We may hasten to  point out that even the power of Central Government for making the rules  under Section 23 is subject to the condition of consultation with the Central  Committee for food standards constituted under Section 23 and placing of  the rules before Parliament. If the power of the Food (Health) Authority is  such as contended by the learned counsel for the state of Maharashtra, then  its power would range sky high without any limitation whatsoever. The  authority could ban any article, irrespective of whether it is used as food or  otherwise, and irrespective of whether it is injurious to health or otherwise.   To take an extreme illustration, if a state Food (Health) Authority in some  local area were taken it into its head that consumption of tea, coffee or milk  is not ’in the interest of public health’, it can issue an order of absolute   prohibition irrespective of whether it is injurious to health or not.  We do  not think that the scheme of the Act warrants such an interpretation. A reference of this Court’s judgment in Dineshchandra Jamnadas  Gandhi  v.  State of Gujarat  vide paras 16 and 17 makes it clear that the  object and the purpose of  the Preventon of Food Adulteration Act, 1954 is  to eliminate the danger to human life from the sale of unwholesome  articles of food. This Court held that the legislation of ’Adulteration of  Food Stuffs and other Goods’ (entry 18 List III of the Seventh Schedule) is  enacted to curb the widespread evil of food adulteration and is a legislative  measure for social defence.  This court indicated the object of the  Prevention of Food Adulteration Act, 1954, its constitutional basis and its  purpose in the following observations: "16.    The object and the purpose of the Act are to eliminate the  danger to human life from the sale of unwholesome articles of  food. The legislation is on the topic ’Adulteration of Food  Stuffs and other Goods’ (entry 18 List III Seventh Schedule).  It  is enacted to curb the widespread evil of food adulteration and  is a legislative measure for social defence.  It is intended to

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suppress a social and economic mischief - an evil which  attempts to poison, for monetary gains, the very sources of  sustenance of life and the well-being of the community.  The  evil of adulteration of food and its effects on the health of the  community are assuming alarming proporations.  The offence  of adulteration is a socio-economic offence.  In Municipal  Corporation of Delhi  v.  Kacheroo Mal   Sarkaria, J.  said: The Act has been enacted to curb and remedy  the widespread evil of food adulteration, and to  ensure the sale of wholesome food to the people.   It is well-settled that wherever possible, without  unreasonable stretching or straining, the language  of such a statute should be construed in a manner  which would suppress the mischief, advance the  remedy, promote its object, prevent its subtle  evasion and foil its artful circumvention.         (emphasis supplied) ... 18.     The offences under the ’Act’ are really acts prohibited by  the police powers of the State in the interests of public health  and well-being.  The prohibition is backed by the sanction of a  penalty.  The offences are strict statutory offences.  Intention or  mental state is irrelevant.  In Goodfellow  v.  Johnson    referring to the nature of offences under the Food and Drugs  Act, 1955, it was said: As is well known, Section 2 of the Food and  Drugs Act, 1955, constitutes an absolute offence.   If a person sells to the prejudice of the purchaser  any food, and that includes drink, which is not of  the nature or not of the substance or not of the  quality demanded by the purchaser he shall be  guilty of an offence.  The forbidden act is the  selling to the prejudice of the purchaser." These observations make it clear that the purpose of the Act, as its title  suggests, is to prevent adulteration of food.  Any attempt to travel beyond  these parameters must necessarily be looked at askance by the court.         There is one more facet of the impugned notification which needs  consideration.  Neither Section 7(iv) of the Act, nor any other provision of  the  Act or the Rules indicates the manner in which an order of prohibition  is to be notified by the Food (Health) Authority.  The manner of bringing  into force the Rules made by a delegate of legislative authority would be  indicated in the Act itself.  There is no indication in the Act as to how the  order made by the Food (Health) Authority would be brought into force.   This is a pointer to the fact that the orders made by the Food (Health)  Authority are  only transitory and intended to deal with  emergent local  situations. Natural Justice:         Learned counsel for the State of Maharashtra cited Union of India  and Anr.  v.  Cynamide India Ltd. and Anr.  (vide para 7) where this  Court observed thus: "The third observation we wish to make is, price fixation is  more in the nature of a legislative activity than any other.  It is  true that, with the proliferation of delegated legislation, there is  a tendency for the line between legislation and administration to  vanish into an illusion.  Administrative, quasi-judicial decisions  tend to merge in legislative activity and, conversely, legislative  activity tends to fade into and present an appearance of an  administrative or quasi-judicial activity.  Any attempt to draw a  distinct line between legislative and administrative functions, it  has been said, is ’difficult in theory and impossible in practice’.  Though difficult, it is necessary that the line must sometimes be  drawn as different legal rights and consequences may ensue.   The distinction between the two has usually been expressed as  ’one between the general and the particular’.  ’A legislative act  is the creation and promulgation of a general rule of conduct

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without reference to particular cases; an administrative act is the  making and issue of a specific direction or the application of a  general rule to a particular case in accordance with the  requirements of policy’.  ’Legislation is the process of  formulating a general rule of conduct without reference to  particular cases and usually operating in future ; administration  is the process of performing particular acts, of issuing particular  orders or of making decisions which apply general rules to  particular cases’.  It has also been said: ’Rule-making is  normally directed toward the formulation of requirements  having a general application to all members of a broadly  identifiable class’ while, ’adjudication, on the other hand,  applies to specific individuals or situations’.  But, this is only a  broad distinction, not necessarily always true.  Administration  and administrative adjudication may also be of general  application and there may be legislation of particular  application only.  That is not ruled out.  Again, adjudication  determines past and present facts and declares rights and  liabilities while legislation indicates the future course of action.  Adjudication is determinative of the past and the present while  legislation is indicative of the future.  The object of the rule, the  reach of its application, the rights and obligations arising out of  it, its intended effect on past, present and future events, its form,  the manner of its promulgation are some factors which may  help in drawing the line between legislative and non-legislative  acts."

       We are, however, unable to accept the contention of the learned  counsel for the state of Maharashtra that, because the notification is  generally intended, it is necessarily a legislative act and therefore there was  no question of complying with principles of natural justice.  If  that were so,  then every executive act could masquerade as a legislative act and escape  the procedural mechanism of fair play and natural justice.         In State of  Tamil Nadu  v.  K. Sabanayagam and Anr.  (vide para  17), this Court after referring to the aforesaid observations of Chinnappa  Reddy, J. in Cynamide (supra), observed that even when exercising a  legislative function, the delegate may in a  given case be required to  consider the view point which may be likely to be affected by the exercise  of power. This Court pointed out that conditional legislation can be broadly  classified into three categories:  (1)  when the legislature has completed its  task of enacting a statute, the  entire superstructure of the legislation is  ready but its future applicability to a given area is left to the subjective  satisfaction of the delegate (as in Tulsipur Sugar Co. case );   (2)  where  the delegate has to decide whether and under what circumstances a  legislation which has already come into force is  to be partially withdrawn  from operation in  a given area or in given cases so as not to be applicable  to a given class of persons who are otherwise  admittedly governed by the  Act;  (3) where the exercise of conditional legislation would depend upon  satisfaction of the delegate on objective facts placed by one class of persons  seeking benefit of such an exercise with a view to deprive the rival class of  persons who otherwise might have already got statutory benefits under the  Act and who are likely to lose the existing benefit because of exercise of  such a power by the delegate.   This Court emphasised that in the third type  of cases the satisfaction of the delegate must necessarily be based on  objective considerations and, irrespective of whether the exercise of such  power is judicial or quasi-judicial function, still it has to be treated to be  one which  requires objective consideration of relevant factual data pressed  into service by one side,  which could be rebutted by the other side, who  would be adversely affected if such exercise of power is undertaken by the  delegate.   In our view, even if the impugned notification falls into the last of the  above category of  cases, whatever the material the Food (Health) Authority  had, before taking a decision on articles in question, ought to have been  presented to the appellants who are likely to be affected by the ban order.  The principle of natural justice requires that they should have been given an

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opportunity of meeting such facts.  This has not been done in the present  case.  For this reason also, the notification is bad in law. Conclusion:         As a result of the discussions, we are of the view that: 1.      Section 7(iv) of the Act is not an independent source of power  for the state authority; 2.      The source of power of the state Food (Health) Authority is  located only in the valid rules made in exercise of the power  under Section 24 of the Act by the State Government, to the  extent permitted thereunder; 3.      The power of the Food (Health) Authority under the rules is  only of transitory nature and intended to deal with local  emergencies and can last only for  short period while such  emergency lasts; 4.      The power of banning an article of food or an article used as  ingredient of food, on the ground that it is injurious to health,  belongs appropriately to the Central Government to be  exercised in accordance with the rules made under Section 23  of the Act, particularly, sub-section (1A)(f). 5.      The state Food (Health) Authority has no power to prohibit the  manufacture for sale, storage, sale or distribution of any article,  whether used as an article or adjunct thereto or not used as food.   Such a power can only arise as a result of wider policy decision  and emanate from Parliamentary legislation or, at least, by  exercise of the powers by the Central Government by framing  rules under Section 23 of the Act; 6.      The provisions of the Cigarettes and Other Tobacco Products  (Prohibition of Advertisement and Regulation of Trade and  Commerce, Production, Supply and Distribution) Act, 2003 are  directly in conflict with the provisions of Section 7(iv) of the  Prevention of Food Adulteration Act, 1954.  The former Act is  a special Act intended to deal with tobacco and tobacco  products particularly, while the latter enactment is a general  enactment.  Thus, the Act 34 of 2003 being a special Act, and  of later origin, overrides the provisions of Section 7(iv) of the  Prevention of Food Adulteration Act, 1954 with regard to the  power to prohibit the sale or manufacture of tobacco products  which are listed in the Schedule to the Act 34 of 2003; 7.      The impugned notifications are ultra vires the Act and, hence,  bad in law; 8.      The impugned notifications are unconstitutional and void as  abridging the fundamental rights of the appellants guaranteed  under Articles 14 and 19 of the Constitution.                   In the result, we allow the appeals and the writ petition and set aside  the impugned judgments of the division benches of the Bombay High Court  and Andhra Pradesh High Court and quash the notifications impugned as  bad in law, void, illegal and unenforceable against the  appellants/petitioners. No order as to costs.