V.S. Raju Naidu vs Commissioner of Civil Supplies, Board of Revenue (C.S.)

P. Ramakrishnan, J.—This writ petition is filed by one V.S. Raju Naidu of Vadapatti Village, Coimbatore district, for the issue of writ of

mandamus under Article 226 of the Constitution in the following circumstances. According to the affidavit filed by the petitioner, he has been

running a rice mill under the name and style of ""Venkatesa Rice Mill'''' under licence No. 3/54 granted by the Vedapatti Panchayat by its resolution

passed on 12th September, 1954. The District Health Officer, Coimbatore, had inspected the site and building and given approval to them by

order passed on 6th September, 1954. The petitioner also entered into an agreement with the Madras Electricity Board for consumption of

electricity for a period of ten years in his mill which is worked by a huller equipped with a 7.5 H.P. electric motor. He has been paying the

minimum charges to the Electricity Board. The Madras Rice Mills Licencing Order, 1955, was published in the Fort St. George Gazette on 26th

January, 1955. Under Rule 2 of this Order, which was framed u/s 3 of the Madras Essential Articles Control and Requisitioning (Temporary

Powers) Act, 1949, no person shall mill rice or hull paddy, or otherwise subject rice or paddy to any processing, by power-driven machinery

except under and in accordance with the terms and conditions of a licence issued in that behalf by the licensing authority. Admittedly, the petitioner

did not obtain a licence under the abovesaid Order but continued to work the rice mill. According to him, he was ignorant that a separate licence

had to be obtained under the aforesaid. Order from the District Collector. He was under the impression that the licence issued by the Panchayat

Board would be sufficient for the purpose. Central Act XXI of 1958 (hereinafter referred to as the Act)--The Rice-Milling Industry (Regulation)

Act, 1958--received the assent of the President on 18th May, 1958. u/s 25 of that Act the State Rules and enactments relating to the regulation or

control of rice mills in the State stood automatically repealed. Therefore, the Madras Rice Mills Licensing Order, 1955, was also repealed with

effect from 18th, May, 1958. In April, 1959 the petitioner applied to the Collector of Coimbatore for the grant of a licence for his rice mill in

accordance with the provisions of the Act. This application was forwarded to the Board of Revenue which rejected it on 16th August, 1961, on

the ground that there was want of adequate paddy in the village. The petitioner appealed to the Government and the appeal was also rejected. The

petitioner thereafter applied to the Collector of Coimbatore on 3rd April, 1963, u/s 6 of the Act for a licence, taking his stand that his mill was an

existing rice mill,"" as defined in Section 3 (b) of the Act. The Collector forwarded this application to the Board of Revenue with his

recommendations. The Board after giving notice to the petitioner and holding an enquiry passed final orders on 7th January, 1965, stating that since

the petitioner had been running his rice mill without a licence it must be presumed that he was working the mill "" clandestinely "" that a mill of that

kind would not come within the definition of "" existing rice mill "" in Section 3 (V) of the Act and that therefore the petitioner would not be entitled to

the grant of licence u/s 6(1) of the Act. It is against this order that the petitioner has filed this writ petition seeking for a writ of mandamus directing

the respondent, Commissioner of Civil Supplies, Board of Revenue, to issue a licence to him for his rice mill u/s 6 of the Act.

Learned Counsel appearing for the petitioner contends that there is nothing in the Act to put any qualification in the definition of "" existing rice

mill"" in Section 3 (6) so as to make that definition applicable only to rice mills which had, at the commencement of the Act, been operating under a

permit granted by the State under the Licensing Order of 1955. The definition in Section 3 (b) runs thus:

''Existing rice mill'' means a rice mill carrying on rice milling operations at the commencement of this Act, and includes a rice mill in existence at such

commencement which is not carrying on rice milling operations but in which ricemilling operations have been carried on at any time within a period

of one year prior to such commencement.

Learned Counsel for the petitioner submits that u/s 6 of the Act any owner of an "" existing rice mill "" as defined above, is entitled to make an

application to the licensing officer for the grant of a licence for carrying on rice milling operation in that rice mill. On receipt of the application in the

prescribed form the licensing officer is required to grant the licence subject to certain conditions, including conditions relating to the polishing of rice

etc.

At this stage a reference can be made to Section 25 of the Act. There are both repealing and saving clauses in Section 25 of the Act. The first

part of Section 25 repeals the State Order. The second part states that notwithstanding any such repeal, any "" permit or licence granted in respect

of any existing rice mill under any such law or order hereby repealed and in force immediately before the commencement of this Act shall continue

to be in force for such period as may be allowed under the proviso to Sub-section (2) of Section 8 for the licensing of such rice mill under the

provisions of this Act."" Section 8 (2) of the Act states:

No owner of a rice mill shall, after the commencement of this Act, carry on rice milling operation except under and in accordance with a licence

granted u/s 6:

Provided that nothing in this sub-section shall apply to an existing rice mill for such period as may be specified in this behalf by the Central

Government by notified order.

Section 8 (2) read with Section 25 (2) means that if an existing rice mill has got a licence granted under the State Rice Mills Licensing Order that

licence will continue to be valid for such period after the coming into force of the Act as may be specified by the Central Government by a notified

order u/s 8(2) of the Act. What the proviso to Section 8(2) read with Section 25(2) would mean is that an existing rice mill owner cannot carry on

rice milling operations after the commencement of the Act unless he was in possession of a licence granted under the State Government''s order,

which was in force at the commencement of the Act and that licence will be valid for such period as may be specified by the Central Government

by its order under the proviso to Section 8 (2). But the petitioner''s request is not to validate his carrying on the rice milling operations after the

commencement of the Act, but his claim is that be is eligible by reason of his owning an existing rice mill, for grant of a licence u/s 6(1), without an

examination of the question whether he was in possession of a licence under the Madras State Order before the Central Act came into force. The

contention of the respondent is that such a licence is necessary. If we want to impose such a restriction on his eligibility for the grant of licence, it

would require that the definition of ""existing rice mill "" in Section 3 (b) would have to be amplified, so as to mean a rice mill for which the owner has

a licence under the appropriate Madras Government Order. Section 6 would also have to be suitably modified so as to make it a condition that the

existing rice mill should have a licence before it can be granted a fresh licence under the Act. As long as such qualifications are not found in the Act,

it would not be proper to impose a further restriction as the Board of Revenue has done, that unless there is a valid pre-existing licence under the

State Order the owner of an existing rice mill will not be entitled to a licence u/s 6 of the Act.

The Board has given some further reasons by stating that the recognition of the petitioner''s eligibility, in the circumstances, would amount to

countenancing the act of his carrying on rice-milling operations before the commencement of the Act without a licence. But that is a different matter

altogether. It should have been dealt with under the appropriate provisions of the State law, if he had contravened the State Order. There is also

one further comment to be made. There is nothing to show that the petitioner was carrying on rice-milling operations clandestinely. In fact, he has

clearly referred to a licence granted by the Panchayat Board and also the approval given by the District Health Officer to the mill building. The

petitioner claims that he was ignorant of the requirements of obtaining a licence from the Collector under the State Order. How far this explanation

can be accepted is a matter which will arise in the context of any prosecution for contravention of the State Order, if a prosecution had been filed

in time. But all these circumstances cannot be brought into the picture in his application u/s 6 of the Act, for a licence, when the Central Act does

not impose any such restrictions upon an existing rice mill, as are stated in the order of the Board of Revenue.

It would appear that the Central Act wanted to start on a clean slate so far as the rice milling industry is concerned, untrammelled by the

previous State Orders regarding licensing and so on, which were all repealed. The mills were to be classified into three categories mentioned in

Section 3, namely, ''defunct rice mill,'' '' existing rice mill,'' and '' new rice mill.'' These three categories are required to satisfy only the conditions

mentioned in the definition, and nothing further, to enable them either to obtain a permit u/s 5 or a licence u/s 6. In view of the above

considerations, I am of the opinion that the order of the respondent in this case cannot be supported. I may also add that in the counter-affidavit of

the respondent it has been admitted that the petitioner had been running a rice mill from 1954 to 1959. Therefore, he was carrying on ricemilling

operations in his rice mill at the date of commencement of Act XXI of 1958. In the above circumstances, a writ will issue as prayed, for, directing

the respondent to give the necessary directions to the appropriate authority for the grant of a licence to the petitioner in conformity with the

requirements of Section 6 of the Act. No order as to costs.