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M/S. Pusparaj & Co. And Others v. Collector Of Balasore And Others Opposite Parties.
Structured Summary of the Opinion (G.K. Misra, C.J., with Panda, J. concurring)
Factual and Procedural Background
The petitioners are dealers in motor tyres and tubes at Bhadrak who received two communications from the Collector of Balasore: Annexure 1 (circular dated 27 May 1971) and Annexure 2 (letter dated 9 July 1971). The principal contents of those communications required dealers to intimate receipt of tyre/tube consignments to the Civil Supplies Officer and/or branch committees, to furnish customer lists, and in respect of certain sizes to withhold sale pending distribution instructions. The Collector acted after a meeting called on 21 May 1971 at the request of the Orissa Truck Owners' Association, which dealers attended and signed a paper recording attendance.
The Tyre Dealers' Association and the Orissa Truck Owners' Association sent further communications pressing for compliance with the Collector's directions. The petitioners filed a writ petition under Article 226 of the Constitution seeking to quash Annexures 1 and 2.
Opposite parties 1, 2 and 4 filed a counter-affidavit conceding that Annexures 1 and 2 had no legal binding effect and explaining that the circulars arose from the meeting and an agreement to facilitate distribution; opposite party No. 3 filed no counter. The State and other respondents contended that because the annexures had no statutory force and did not infringe any legal right, the writ was not maintainable.
Legal Issues Presented
- Whether Annexures 1 and 2, being instructions circulated by the Collector without statutory authority, unlawfully infringed the petitioners' right to carry on business under Article 19(1)(g) of the Constitution.
- Whether restrictions on the right under Article 19(1)(g) can be validly imposed in the absence of an authority of law as required by Article 19(6).
- Whether the writ petition under Article 226 is maintainable where the impugned circulars/letters have no statutory backing and the State respondents assert no legal coercive effect.
- Whether the appropriate relief is to quash the annexures (certiorari) and to prohibit the respondents from giving effect to them (mandamus).
Arguments of the Parties
Petitioners' Arguments
- The petitioners challenged Annexures 1 and 2 by way of writ under Article 226 seeking quashing of those communications.
- In their rejoinder, the petitioners asserted that the signatures on the meeting attendance paper (annexure A/1) were only tokens of presence and did not indicate consent to the proposed arrangement or acceptance of controls in distribution.
Opposite Parties' / State's Arguments
- Opposite parties 1, 2 and 4 conceded that Annexures 1 and 2 lacked legally binding effect; they narrated that the communications resulted from a meeting (called by the Collector at the request of the Truck Owners' Association) where dealers agreed to intimate receipts to facilitate fair distribution.
- The State (learned Government Advocate and Mr. Patnaik) contended that because no legal right of the petitioners was infringed by the annexures (there was no statutory force behind them), the writ petition was not maintainable.
- Opposite party No. 3 filed no counter-affidavit.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
The Court analyzed the matter as follows (step-by-step as presented in the opinion):
- The Court observed that Annexures 1 and 2 were issued by the Collector but not on the strength of any law; the State itself conceded that the circulars had no legally binding effect on dealers (paras 23 and 24 of the opinion).
- The factual origin of the annexures was found to be a meeting convened by the Collector at the request of the Orissa Truck Owners' Association; dealers attended and signed an attendance paper. The Collector then issued the circulars to facilitate distribution in pursuance of that meeting (para 21).
- The Court noted the State's submission that because no legal right of the petitioners had been affected, the writ was not maintainable. The Court addressed this objection directly (para 24 and para 30).
- The Court examined constitutional protections: it identified the petitioners' right to carry on business under Article 19(1)(g) and recognized that this right is subject to restrictions that must be authorized by law under Article 19(6) (paras 25–26).
- Applying those constitutional principles, the Court held that although the Collector's objective (ensuring equitable distribution amid short supply and black-marketing) was laudable, the Collector lacked statutory authority to impose the arrangement. The attempted control was exercised without sanction of law and was therefore colourable (paras 24, 27–29).
- The Court reasoned that if large-scale black-marketing existed, the proper course was to inform the State Government so that statutory control orders or legislation could be enacted; the Collector could not achieve by indirect measures what he lacked power to do directly (paras 24 and 31).
- Having found that the arrangement infringed the petitioners' Article 19(1)(g) rights without the authority of law required by Article 19(6), the Court rejected the objection to maintainability and proceeded to grant relief (paras 30–32).
Holding and Implications
Core Holding: The writ petition was allowed. A writ of certiorari was issued quashing Annexures 1 and 2, and a writ of mandamus was issued prohibiting the opposite parties from giving effect to the impugned annexures (paras 13–14, 31–32).
Consequences and immediate effects:
- The Collector's circulars (Annexures 1 and 2) were held to be without lawful authority and therefore quashed.
- The opposite parties were ordered not to give effect to those communications (mandamus).
- The Court recognized and protected the petitioners' right to carry on business under Article 19(1)(g), emphasizing that any restriction on that right must rest on valid law as required by Article 19(6).
- The petition was allowed without costs (para 13). Justice Panda concurred (para 15–16).
The opinion does not purport to establish a new statutory rule; it addresses the legality of the specific administrative communications and their effect on fundamental rights in the absence of statutory authority.
G.K Misra, C.J:— The petitioners are dealers in tyres and tubes at Bhadrak. Collector of Balasore (opposite party No. 1) issued a circular, annexure 1, on 27th May, 1971. The main terms of that circular are extracted hereunder;
All Motor Tyres and Tubes Dealers of the District.
Sub:— Distribution of motor tyres and tubes:
According to one of the decisions taken in that meeting, the motor tyres/tubes dealers of this district will send immediate intimation to the Civil Supplies Officer, Balasore, whenever they got any supplies of motor tyres and tubes.
Secondly the dealers will also furnish lists of their customers for such tyres and tubes to the Civil Supplies Officer. Accordingly, you are requested to please intimate to the Civil Supplies Officer in the pro forma given below the number of motor tyres and tubes held in stock in date, or whenever you receive supplies in future, invariably, in order to arrange for its equitable distribution as decided upon in that meeting.
In this connection you are also requested to furnish a list of your customers for such tyres and tubes to the undersigned with a copy to the Secretary, Orissa Truck Owners Association, Balasore or Bhadrak as the case may be. The stock of tyres and tubes in hand, or to be received meanwhile, should not be sold to anybody until unless you receive further instructions from this office regarding mode of distribution etc. which please note.
Yours faithfully,
Sd/- Illegible,
for Collector, Balasore.
The Collector issued another letter, Annexure 2, on 9th July, 1971. So far as is relevant, it runs thus:—
All Motor Tyres and Tubes Dealers of Balasore District.
Sub: Distribution of Truck/Bus Tyres/Tubes.
2. Since these Branch Committees of Balasore and Bhadrak will distribute the tyres received by the dealers in Balasore and Bhadrak sub-division respectively, the tubes and tyres dealers of Balasore and Bhadrak will send receipt intimation within 24 hours of the receipt of tyres and tubes consignments by them, to the respective branch Secretaries of Balasore and Bhadrak for the purpose of distribution under intimation to the Civil Supplies Officer, Balasore. Until further orders, stocks of tyres and tubes of the sizes 900 × 20 and 1000 × 20 only need be intimated for such distribution. The other tyres and tubes may be sold by dealers themselves to their bona fide customers.
3. As soon as an intimation from a dealer is received the Branch Committee will make distribution immediately and inform the dealer within 24 hours with a copy to the Civil Supplies Officer, Balasore.
Yours faithfully,
Sd/- Illegible,
For Collector, Balasore.”
2. The Tyre Dealers' Association, Bhadrak, addressed a letter, Annexure 3, on 9-7-71 protesting against the control exercised by the Collector in the matter of distribution of tyres and tubes. The Orissa Truck Owners' Association (opposite party No. 3) addressed Annexure 4 on 21st July, 1971, to some of the petitioners. The subject of the letter (Annexure 4) was: intimation regarding arrival of tyres, with reference to Collector's letter, Annexure 2, dated 9th July, 1971. Therein, they said as follows:
In this connection I am very sorry to inform you that some of you have received tyres in the meantime, that is, after the receipt of the above letter under reference, but we have not yet been intimated. However, we request you to kindly inform us in future all tyres and tubes received by you as per the letter of Collector. After receipt of your intimation we will issue coupons to the consumers, who will receive tyres from you on payment of cash.”
3. The writ application has been filed under Article 226 of the Constitution for quashing annexures 1 and 2.
4. No counter has been filed on behalf of opposite party No. 3. Opposite parties 1, 2 and 4 have filed a counter-affidavit. It is conceded therein that annexures 1 and 2 have got no legally binding effect on the motor tyres and tubes-dealers including the petitioners. The circumstances in which annexures 1 and 2 came into existence have been narrated thus:—
A meeting was called on 21-5-71 by the Collector, Balasore, at the request of Orissa Truck Owners' Association to discuss regarding smooth and fair distribution of tyres and tubes. The dealers of the district of Balasore, including the petitioners and the members of the Orissa Truck Owners' Association attended the meeting. In token of their attendance in the meeting, the petitioners along with others put their signatures on a paper (see annexure A/1). It was agreed upon in that meeting that the dealers would intimate the Civil Supplies Officer and the Truck Owners' Association soon after receipt of tyres and tubes by them for smooth, fair and equitable distribution. Copy of the proceeding of the meeting is annexure B/1. In pursuance of the undertaking arrived at the meeting, the Collector issued the instructions in annexures 1 and 2 to all the motor tyres and tubes-dealers of the district. Thus, annexures 1 and 2 are not in the nature of any orders issued by the Collector. On the other hand, the Collector, as the senior-most executive officer of the District Welfare State took upon him the extra responsibility to facilitate smooth, fair and equitable distribution of motor tyres and tubes in the district, and invited co-operation from the petitioners in the aforesaid meeting. Annexures 1 and 2, therefore, have no binding effect on the petitioners in the eye of law, nor do they affect the legal rights of the petitioners. These are the outcome of a general agreement in the meeting which was expected to be honoured by those who agreed to the same. As no legal right of the petitioners are affected by annexures 1 and 2 the present writ application is not maintainable.
A rejoinder was filed by the petitioners saying that they put their signatures to annexure A/1 only in token of the fact of their presence in the meeting, and not as evidence of their being consenting parties to the arrangement.
5. From the aforesaid narration of facts it would be clear that the Collector did not issue Annexures 1 and 2 on the strength of any law. The State of Orissa accepts the position that the petitioners cannot be penalised for infringement of the mandate issued in those circulars.
6. It was very seriously contended by the learned Government Advocate and Mr. Patnaik that as no legal right of the petitioners was infringed by annexures 1 and 2 the writ application is not maintainable. As would appear from annexures 1 to 4, control was exercised over the petitioners in the matter of equitable distribution of tubes and tyres without sanction of law. Doubtless, the object of the Collector was laudable. There was short supply of tyres and tubes. Whatever was also supplied to Orissa appears to have been diverted to other States. There was black-marketing in sale of tubes and tyres, both inside the State of Orissa, and by sending the same outside Orissa. If the Collector was aware of the position that large-scale black-marketing took place in the sale of tyres and tubes, his duty was to apprise the State Government for enacting necessary laws for effecting equitable distribution, and necessary laws should have been enacted for that purpose by the State. Without legal sanction, control should not have been exercised by resorting to a subterfuge by organizing a discussion amongst Truck Owners' Association and persons carrying on the business in the sale of tyres and tubes. The Collector ought to have visualised the position that an arrangement, not enforceable in law, should not be given, effect to, by issue of circulars.
7. The effect of this arrangement was to infringe the right of the petitioners, under Article 19(1)(g) of the Constitution, which lays down that all citizens shall have the right to practice any profession, or to carry on any occupation, trade or business. Thus, the petitioners had the full right to carry on their business of selling tyres and tubes in any manner they liked.
8. This right is, however, subject to the restriction imposed in Article 19(6). It prescribes that nothing in sub-clause (g) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interest of the general public, reasonable restrictions on the exercise of the right conferred by the said sub-clause.
9. As has been conceded on behalf of the opposite parties there is no legal sanction behind annexures 1 and 2. The restriction might be reasonable, but not the authority of law. The impugned arrangement, purporting to have given a colour of voluntariness whereby the petitioners are said to have agreed to the exercise of control on them by opposite party No. 1, is, on the face of it, colourable.
10. The Collector of a district exercises wide executive powers, and can harass the petitioners in different ways if they are not agreeable to the arrangement proposed in the meeting presided over by the Collector. We are satisfied that though the Collector did the entire arrangement with the bona fide intention of resolving the difficulty arising out of inequitable distribution, the same cannot be sustained in law.
11. The Collector should have brought the matter of existence of blackmarketing, in distribution of tyres and tubes, to the notice of the State Government who should have resorted to statutory control orders to effect equitable distribution arising out of short supply. What cannot be done directly by authorities vested with powers should not be taken recourse to indirectly.
12. On the aforesaid analysis, we reject the objection regarding maintainabillty.
13. In the result, the writ application is allowed, but in the circumstances, without costs.
14. A writ of certiorari be issued quashing annexures 1 and 2. A writ of mandamus be issued to the opposite parties prohibiting them not to give effect to the impugned annexures.
15. Panda, J.:— I agree.
16. Petition allowed.
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