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PETITIONER: STATE OF ANDHRA PRADESH & ANR.

       Vs.

RESPONDENT: POTTA SANYASI RAO & ORS.

DATE OF JUDGMENT26/08/1975

BENCH: GOSWAMI, P.K. BENCH: GOSWAMI, P.K. ALAGIRISWAMI, A. UNTWALIA, N.L.

CITATION:  1975 AIR 2030            1976 SCR  (1) 423  1975 SCC  (2) 480

ACT:      Essential Commodities  Act, 1955,  Ss. 2(a)(xi)  and 5- Delegation  to   State  Government  power  to  make  Orders- Declaration  of   commodity  as  essential  thereafter-State Government, if  can exercise delegated power with respect to such commodity.

HEADNOTE:      In June,  1966, the  Central Government, in exercise of the powers  conferred by  s. 5  of the Essential Commodities Act, 1955.  delegated its  power to make Orders to the State Governments with  respect to certain matters specified in s. 3(2) in  relation to  all essential  commodities other  than certain specified  commodities. Tyres  and  Tubes  were  not essential commodities under s. 2(a)(i) to (x), nor were they declared  to   be  essential   commodities  by  the  Central Government under  s. 2(a)(xi) at the time of the delegation; but, subsequent  to the delegation of the power to the State Governments, certain  types of tyres and tubes were declared to be essential commodities under s. 2(a) (xi).      In exercise  of the delegated power the State of Andhra Pradesh issued  the Andhra  Pradesh Tyres and Tubes Dealers’ Licensing Order,  1973. The  respondents, who are dealers in tyres and tubes, challenged the validity of the Order on the ground that  the State  Government had  no power to issue an Order with  regard to tyres and tubes which were declared by the Central Government to be essential commodities after the delegation of powers to the State Government. The High Court struck down the Order.      Allowing the appeal to this Court. ^      HELD :  There is  nothing in s. 5 to limit the power of delegation in  favour of  the State  Government only  to the commodities specified  in s.  2(a)(i) to  (x)  or  to  those commodities declared  essential under  s. 2(a)(xi) up to the date of  delegation. Delegation  under s.  5  is  a  general delegation and  will enure in favour of exercise of power by the State  Government with  respect to  commodities declared essential by  the Central Government from time to time under s. 2(a)(xi)  even subsequent  to the  delegation. It  is not necessary that every time the Central Government declares an

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essential commodity,  it  has  also  to  pass  an  order  of delegation  with  regard  to  that  commodity.  It  will  be sufficient in  law if  on the date the State Government duly empowered under  s. 5,  makes notification  under s.  3 with regard to  an essential  commodity within  the meaning of s. 2(a) including the residuary cl. (xi) thereof. [425D- G]

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1408 of 1974.      Appeal by  special leave  from the  Judgment and  order dated the  27th December,  1973 of  the Andhra  Pradesh High Court at Hyderabad in Writ Petition No. 7413/73.      R. Ram Reddy and P. P. Rao, for the appellant.      Govind Das and Girish Chandra, for the respondent.      The Judgment of the Court was delivered by      GOSWAMI, J.-This  appeal by  special leave  is directed against the  judgment  of  the  Andhra  Pradesh  High  Court whereby  the   Andhra  Pradesh   Tyres  and  Tubes  Dealers’ Licensing Order  1973  (briefly  the  Licensing  Order)  was struck down as illegal and ultra vires. 424      A few facts which are material may first be noted.      By Notification  S.O. 1844  dated June  18,  1966,  the Central Government  in exercise  of the  powers conferred by section 5  of the  Essential Commodities  Act, 1955 (briefly the Act)  directed "that  the powers conferred on it by sub- section (1)  of section  3 of the said Act to make orders to provide for  the matters specified in clauses (d), (e), (f), (g), (h), (i), (ii) and (j) of sub-section (2) thereof shall in relation  to all  commodities other  than foodstuffs  and fertilisers  (whether   inorganic,  organic  or  mixed),  be exercisable also  by a State Government, or in relation to a Union Territory,  by the  administrator thereof,  subject to the following conditions...."      Section 2(a)  of the  Act defines "essential commodity" which means  ten specified  commodities  and  the  residuary clause (xi) thereof refers to-      "any  other   class  of  commodity  which  the  Central      Government may,  by notified  order, declare  to be  an      essential commodity for the purposes of this Act, being      a commodity  with respect to which Parliament has power      to make  laws by  virtue of entry 33 in List III in the      Seventh Schedule to the Constitution".      Tyres and  tubes are  not included in the ten specified commodities in section 2(a). However, the Central Government by three notified orders, namely, S.O. No. 2511 dated August 17, 1966,  S.O. No.  2878 of August 22, 1968 and S.O. No. 85 dated January  3, 1969,  declared cycle tyres and tubes, car and tractor  tyres and  tubes  and  tyres  of  buses,  vans, trucks, etc.  as essential  commodities under  section  2(a) (xi).      The  impugned   Licensing  Order   was  passed  by  the Government of Andhra Pradesh on June 18, 1973 in exercise of the powers  conferred by sub-section (2) of section 3 of the Act read with S.O. No. 1844 dated June 18, 1966 and with the prior   concurrence   of   the   Central   Government.   The respondents, who  were dealers  in tyres and tubes of buses, trucks, jeeps,  cars and other auto-vehicles, challenged the validity of the Licensing Order on the ground that the State Government had  no power  to issue  the same  with regard to tyres  and   tubes  which   were  declared  by  the  Central Government to  be essential  commodities subsequent  to  the

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delegation of powers to the State Government under section 5 which  had  been  made  earlier  on  June  18,  1966.  Their contention was  accepted by the High Court and the Licensing Order was struck down. Hence this appeal by special leave at the instance of the State Government      The short  question that  arises for  consideration  is whether the  order of  delegation of  power by  the  Central Government under  section 5 enabling the State Government to make orders  or issue  notifications under  section 3  would empower the State Government to 425 promulgate orders  with regard  to  commodities  which  were declared  to   be  essential   commodities  by  the  Central Government subsequent to the order of delegation.      Section 5 of the Act reads as follows:-      "The Central  Government may, by notified order, direct      that the  power to  make orders  or issue notifications      under section  3 shall, in relation to such conditions,      if any,  as may  be  specified  in  the  direction,  be      exercisable also by-      (a)  such  officer  or  authority  subordinate  to  the           Central Government, or      (b)  such State Government or such officer or authority           subordinate to  a  State  Government,  as  may  be           specified in the direction."      There is  nothing in  section 5  to limit  the power of delegation in  favour of  the State  Government only  to the commodities  specified   in  section   2(a)  or   to   those commodities declared  essential under section 2(a) (xi) upto the date  of delegation.  Delegation under  section 5  is  a general delegation  and will  enure in favour of exercise of power by  the State  Government with  respect to commodities declared essential  by the  Central Government  from time to time under  section 2(a)(xi) even subsequent to the order of delegation. It  is not necessary that every time the Central Government declares  an essential  commodity it  has also to pass an  order of  delegation under section 5 with regard to that commodity.  Reading section  5 and  section 3  together there  is  no  warrant  for  the  view  that  the  power  of delegation is  confined to  essential commodities  specified under the  Act and  such others  as may  be declared  by the Central Government  upto the order of delegation. Delegation of power  to the  State Government to act under section 3 is not restricted to any specified essential commodity as such. It will  be sufficient  in law  if on  the  date  the  State Government,  duly   empowered  under   section  5,  makes  a notification under  section 3  with regard  to an  essential commodity within  the meaning  of section 2(a) including the residuary clause  (xi) thereof. All that is required is that the commodity,  on the  date  of  the  order  of  the  State Government,  answers  the  description  of  the  clauses  in section 2(a)  of the  Act. The  fact  that  a  commodity  is declared essential  after the  order of  delegation does not affect the  exercise of  power by the State Government under section 3  of the  Act. The  High Court  is, therefore,  not right in  narrowly construing  the order of delegation under section 5 of the Act. The Licensing 426 Order is,  therefore, not  invalid on  the ground  that  the tyres and tubes were declared to be essential commodities by the Central  Government after  the order of delegation under section 5 of the Act.      In the result the appeal is allowed and the judgment of the High  Court is  set aside.  There will  be, however,  no order as to costs.

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V.P.S.                                       Appeal allowed. 427