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Hon''ble Arun Mishra, C.J.—In this petition, the petitioner-Association has questioned the amendments made in Rules 6 and 7 of the Rajasthan Forest Produce (Establishment & Regulation of Saw Mills) Rules, 1983 (hereinafter referred to as "the Rules of 1983"). By amending Rule 6, the application fee for permit/license, which was earlier Rs. 25/-, has been revised to Rs. 250/-; fee for grant of permit/license, which was earlier Rs. 250/-, has been revised to Rs. 2500/- and the security deposit for grant of license, which was earlier Rs. 500/-, has been revised to Rs. 5000/-. Earlier there was no time limit prescribed for the validity of the license and now by inserting new sub-rule (iv) in Rule 7 of the Rules of 1983, the period of license has been limited to five years and thereafter, the license has to be renewed for every subsequent five years and application has to be made three months before the expiry of period of license. The licensee shall have to pay license fee afresh. It is averred in the petition that vide order dated 30.10.2002 passed in Writ Petition No. 202/95 T.N.Godavaraman V/s Union of India & oRs. , the Apex Court directed that no State or Union Territory shall permit any unlicensed saw mills to operate and closure of such unlicensed saw mills was ordered. Even operation of small saw machines, which were unlicensed, was stopped by the respondents. Thereafter, considering the difficulties of workers operating small saw machines, a representation was submitted on behalf of the State Government before the Central Empowered Committee constituted by the Apex Court in the aforesaid case and on the recommendation of the Central Empowered Committee, the State Government in exercise of the powers conferred by Sections 41 and 42 read with Section 76 of the Rajasthan Forest Act, 1953 (Rajasthan Act No. XIII of 1953) (hereinafter referred to as "the Forest Act"), has made amendment in the Rules of 1983 by way of making Rajasthan Forest Produce (Establishment and Regulation of Saw Mills) (Amendment) Rules, 2005 (hereinafter referred to as "the amended Rules of 2005") and the amendment was notified vide notification dated 4.2.2006. The term ''saw mill'' was extended to include ''wood handicraft saw mill'' and accordingly, amendment was made in Rule 2 of the Rules of 1983. However, the application fee for license & permit, fee for grant of license & permit and the security deposit for grant of license were not altered. No time limit for validity of the license was prescribed. Once the license was granted, it was to continue till indefinite period. There was provision for one time license fee. Accordingly, the members of the petitioner-Association obtained the licenses.
It is further averred in the petition that in the Rules of 1983, amendments were again made by the State Government by way of making the Rajasthan Forest Produce (Establishment and Regulation of Saw Mills) (Amendment) Rules, 2008 (hereinafter referred to as "the Rules of 2008") and the same was notified vide notification dated 13.1.2010 contained in Annexure 9 to the petition. Rules 6 and 7 of the Rules of 1983 have been amended in the aforesaid manner enhancing application fee for permit & license, fee for grant of permit & license and the security deposit for grant of license and the period of license has also been curtailed to five years and thereafter, renewal for every subsequent five yeaRs. Pursuant to the amendments made in Rules 6 and 7 of the Rules of 1983, which were notified in 2010 vide notification AnnEx. 9, advertisement dated 4.6.2010 has been published in the newspaper directing that licenses of saw mills have to be renewed so as to bring them in consonance with the amended Rules and licensees were asked to deposit application fee, fee for grant of license & permit and security deposit for grant of license as per amended Rules. The petitioner-Association submitted representation, but nothing was done. Hence, the writ petition has been preferred.
The petitioner-Association has questioned the amendments made in Rules 6 and 7 of the Rules of 1983 vide notification AnnEx. 9 dated 13.1.2010 on the grounds that the same are violative of Article 19(1)(g) of the Constitution; unreasonable restriction has been put by curtailing the period of license from indefinite period to five years; enhancement of application fee, fee for grant of license & permit and security deposit for grant of license by ten times cannot be said to be reasonable and proper; provision is prohibitive and unreasonable restriction has been put on the right of small scale handicraft manufacturers including members of the petitioner-Association to carry on occupation, trade or business; compelling renewal of the license was illegal and without jurisdiction. Notification dated 13.1.2010 amending Rules 6 and 7 has not been issued with the concurrence of the Central Empowered Committee, thus, notification AnnEx. 9 is illegal.
In the return filed by the respondents, it is contended that the action taken is as per Forest Act and the Rules of 1983; the Central Empowered Committee has been consulted; there is no restriction put on the right of the members of the petitioner-Association to carry on their trade or business by amending the rules vide notification AnnEx. 9 dated 13.1.2010; revision of application fee, fee for grant of license and permit and security deposit for grant of license cannot be said to be arbitrary or illegal in any manner; as per policy, license has to be renewed, as such, amendment has rightly been made for renewal of the license; there is no illegality in the advertisement dated 4.6.2010 and the same has been issued to give effect to the amended Rules; all licensees were required to make application for renewal of licenses so as to bring them in tune with the amendments made in the Rules of 1983; there is no violation of any fundamental right; members of the petitioner-Association have not been restrained from carrying out occupation, trade or business; by directing renewal it cannot be said that any restriction has been put on the rights to carry on trade or business; amendments have been made in exercise of the powers conferred by Sections 41 & 42 read with section 76 of the Forest Act; revision of fee cannot in any manner be said to be illegal or arbitrary.
Shri A.K.Khatri, Learned Counsel appearing on behalf of the petitioner has submitted that once license has been granted, the amendment could not have been made to curtail the period of license; revision of application fee, fee for grant of license and permit and security deposit for grant of license by ten times is unreasonable, arbitrary and illegal; provision is restrictive of right to carry on occupation, trade or business contained in Article 19(1) (g) of the Constitution and thus, the amendment is illegal, unconstitutional and ultra vires the Constitution; once license has been granted without any time limit, it was not open to amend the rule in the method and manner it has been done.
Shri M.A.Siddiqui, Learned Counsel appearing on behalf of the respondents has supported the amendments made in Rules 6 and 7 of the Rules of 1983. He has submitted that the amendments so made are proper; revision of fee, which was prescribed in the year 1983, was required to be revised and the same was rightly revised and revision of fee cannot be said to be arbitrary, unreasonable and illegal. Earlier there was no period of license prescribed and as per policy, license should be renewed and thus, period of license was prescribed as five years and the license was to be renewed for every subsequent five yeaRs. The amendments so made cannot be said to be restrictive of the occupation or trade or business. It is open to the members of the petitioner-Association to carry on their trade or business as per amended Rules. There is no vested right in the licensee. Hence, no case for interference is made out and the writ petition is liable to be dismissed.
In the case of T.N.Godavaraman V/s Union of India & oRs. (supra), the Apex Court has constituted Central Empowered Committee. The Apex Court has also issued directions that no State or Union Territory shall permit any unlicensed saw mills to operate and ordered closure of such unlicensed saw mills. Thereafter, amendment was made in the Rules of 1983 by way of amended Rules of 2005, which were notified vide notification dated 4.2.2006, Thereafter, amendments were again made in the Rules of 1983 by way of amended Rules of 2008 notified on 13.1.2010 and the said amendments were made in consultation with the Central Empowered Committee. Rule 6 was amended in the manner that the application fee for grant of permit/license, which was earlier Rs. 25/-, was revised to Rs. 250/-; fee for grant of permit/license, which was earlier Rs. 250/-, was revised to Rs. 2500/- and the security deposit for grant of license, which was earlier Rs. 500/-, was revised to Rs. 5000/-. Rule 7 has also been amended by way of inserting a new sub-rule (iv) which prescribes maximum period of license to be five years and thereafter, renewal of license for every subsequent five yeaRs. Earlier there was no restriction of the period and once license was granted, it could have continued for indefinite period.
The question for consideration is whether the amendments made in Rules 6 and 7 of the Rules of 1983 vide notification dated 13.1.2010 are valid.
The amended Rule 6 and new sub-rule (iv) inserted by way of amendment in Rule 7 of the Rules of 1983 are quoted below:-
Fee and security deposit.- The following fee and security deposit shall be payable under these rules:-
(i)
Application fee for permit
Rs. 250/-
(ii)
Application fee for license
Rs. 250/-
(iii)
Fee for grant of permit
Rs. 2500/-
(iv)
Fee for grant of license
Rs. 2500/-
(v)
Security deposit for
grant of license
Rs. 5000/-
Grant of License- (i).......
(ii).........
(iii)........
(iv) The license shall be granted initially for a period of five years and thereafter renewed by the licensing officer on an application made by the licensee to this effect for every subsequent five yeaRs. Such application shall be made at least three months before the expiry of period of license. The licensee shall have to pay license fee afresh. In case licensee fails to submit his application for renewal within the stipulated period and submit application for renewal after expiry of stipulated period but within three months of expiry of the license, the licensing authority may consider renewal of license on payment of fee equal to double the prescribed fee. If licensee does not apply for a renewal of license within three months after the expiry of the license, renewal of license shall not be considered.
The aforesaid amendments have been made by the State Government in exercise of the powers conferred by Sections 41 and 42 read with Section 76 of the Forest Act. Section 41 empowers the State Government to make rules to regulate the transit of all timber and other forest produce. Section 42 deals with the penalty for breach of rules made u/s 41 and the State Government may by such rules prescribe as penalties for the contravention thereof imprisonment for a term which may extend to six months, or fine, which may extend to five hundred rupees or both. Section 76 confers additional powers on the State Government to make rules. Thus, it is open to the State Government to prescribe application fee for license and permit, fee for grant of license & permit and security deposit for grant of license and also to prescribe other terms and conditions on which license shall be granted. It is also open to the State Government to take policy decision with respect to period of license.
The amendments, which have been made by the State Government in Rules 6 and 7 of the Rules of 1983 in exercise of the powers conferred by Sections 41 and 42 read with section 76 of the Forest Act, cannot be said to be unauthorized or illegal. The State Government is authorized to take such policy decision and has also legislative competence to regulate the business & licensing.
Coming to the question of increase in fee for application, grant of permit/license and security in case of grant of license. No doubt fee and security have been revised by ten times, however, earlier when the application fee, fee for grant of permit/license and security deposit for grant of license were fixed, they were fixed way back in the year 1983 and considering the devaluation of money which has taken place during more than two decades, it can hardly be said that enhancement so made in the fee is unreasonable. The revision of application fee for permit/ license from Rs. 25/- to Rs. 250/- cannot be said to be excessive or oppressive or restrictive on the right of the members of the petitioner-Association to carry on their occupation or trade or business. The revision of fee for grant of permit/license from Rs. 250/- to Rs. 2500/- also cannot be said to be arbitrary or unreasonable or excessive considering the period for which it is to be paid for five yeaRs. Similarly, revision of security deposit for grant of license from Rs. 500/- to Rs. 5000/- also cannot in any manner be regarded as arbitrary or excessive or exorbitant, rather revision appears to be reasonable one.
Coming to the question of curtailment of period of license by way of inclusion of new sub-rule (iv) in Rule 7 of the Rules of 1983, earlier there was no restriction on the period for which license was to be granted and now by way of inserting new sub-rule (iv) in Rule 7, maximum period of license has been prescribed to be five years and thereafter, renewal for every subsequent five yeaRs. Sub-rule (iv) provides that license shall be granted initially for a period of five years and thereafter, renewed by the licensing officer on an application made by the licensee to this effect for every subsequent five yeaRs. The application has to be filed at least three months before the expiry of period of license. The licensee shall have to pay license fee afresh so prescribed. We find that no vested right accrued in favour of the licensee of continuation of license. The continuation of license is also subject to the policy of the State Government. The State Government has amended Rule 7 by way of inserting new sub-rule (iv) prescribing period of license to be five years and thereafter, renewal for every subsequent five yeaRs. The Government and the legislature have power to evolve its policy and to withdraw the old policy contained in the rules or otherwise. It is not for the court to bind the Government to its previous policy by invoking the doctrine of legitimate expectations unless the change in policy is vitiated by mala fide or abuse of power. The decision which has been taken by the State Government cannot be said to be arbitrary or illegal in any manner. It is not restrictive measure, but it is regulatory measure which has been adopted. The amendment, which has been made in Rule 7 by way of inserting new sub-rule (iv) curtailing period of license from indefinite period to five years and thereafter, renewal for every subsequent five years, cannot be said to be restrictive and it does not put restriction on the right of the members of the petitioner-Association to carry on their occupation or trade or business. It is open to the members of the petitioner- Association to carry on their trade or business in terms of the amended Rules, which cannot be regarded as arbitrary or illegal or violative of Article 19(1)(g) or against the public policy, rather the policy is to subserve the public interest to keep check on the licensee. It is open to the State Government to frame guidelines for the grant of license from time to time and also to fix the period of license. Curtailment of period of license cannot be said to be taking away of any vested right of the licensee since conditions subject to which license is granted, are regulatory measure.
In P.T.R. Exports (Madras) Pvt.Ltd. & oRs. V/s Union of India and oRs. ((1996) 5 SCC 268), the government has withdrawn its previous policy and introduced new policy with respect to grant of export license and in the context of above policy the question arose whether the Government is bound by the previous policy or whether it can revise its policy and considering the doctrine of legitimate expectations, the Apex Court observed that the petitioners have no vested or accrued right for the issuance of permits on the MEE or NQE nor the Government is bound by its previous policy. It would be open to the Government to evolve the new schemes and the petitioners would get their legitimate expectations accomplished in accordance with either of the two schemes subject to their satisfying the conditions required in the scheme. The High Court was right in its conclusion that the Government is not barred by the promises or legitimate expectations from evolving new policy in the impugned notification. The Apex court has further observed that grant of license depends upon the policy prevailing on the date of the grant of the license or permit. As in the aforesaid case the license policy has been changed after date of application & before date of grant, in that context the aforesaid discussion has been made.
The Apex Court has further observed in the case of P.T.R. Exports (Madras)Pvt.Ltd. (supra) that the power to lay policy by executive decision or by legislation includes power to withdraw the same unless in the former case, it is by mala fide exercise of the power or the decision or action taken is in abuse of power. The doctrine of legitimate expectation plays no role when the appropriate authority is empowered to take a decision by an executive policy or under law. The court leaves the authority to decide its full range of choice within the executive or legislative power. In matters of economic policy, it is settled law that the court gives a large leeway to the executive and the legislature. Granting licenses for import or export is by executive or legislative policy; Government would take diverse factors for formulating the policy for import or export of the goods granting relatively greater priorities to various items in the overall larger interest of the economy of the country. It is, therefore, by exercise of the power given to the executive or as the case may be, the legislature is at liberty to evolve such policies. A prior decision would not bind the Government for all times to come. When the Government is satisfied that change in the policy was necessary in the public interest, it would be entitled to revise the policy and lay down new policy. The court, therefore, would prefer to allow free play to the Government to evolve fiscal policy in the public interest and to act upon the same. Equally, the Government is left free to determine priorities in the matters of allocations or allotments or utilization of its finances in the public interest. It is equally entitled, therefore to issue or withdraw or modify the export or import policy in accordance with the scheme evolved. The Apex court held thus:-
In the light of the above policy question emerges whether the Government is bound by the previous policy or whether it can revise its policy in view of the changed potential foreign markets and the need for earning foreign exchange? It is true that in a given set of facts, the Government may in the appropriate case be bound by the doctrine of promissory estoppel evolved in Union of India V. IndoAfghan Agencies Ltd.(AIR 1968 SC 718). But the question revolves upon the validity of the withdrawal of the previous policy and introduction of the new policy. The doctrine of legitimate expectations again requires to be angulated thus: whether it was revised by a policy in the public interest or the decision is based upon any abuse of the power? The power to lay policy by executive decision or by legislation includes power to withdraw the same unless in the former case it is by malafide exercise of power or the decision or action taken is in abuse of power. The doctrine of legitimate expectation plays no role when the appropriate authority is empowered to take a decision by an executive policy or under law. The court leaves the authority to decide its full range of choice within the executive or legislative power. In matters of economic policy, it is settled law that the court gives a large leeway to the executive and the legislature. Granting licenses for import or export is by executive or legislative policy; Government would take diverse factors for formulating the policy for import or export of the goods granting relatively greater priorities to various items in the overall larger interest of the economy of the country. It is, therefore, by exercise of the power given to the executive or as the case may be, the legislature is at liberty to evolve such policies.
It would, therefore, be clear that grant of license depends upon the policy prevailing as on the date of the grant of the license. The court, therefore, would not bind the Government with a policy which was existing on the date of application as per previous policy. A prior decision would not bind the Government for all times to come. When the government is satisfied that change in the policy was necessary in the public interest, it would be entitled to revise the policy and lay down new policy. The court, therefore, would prefer to allow free play to the Government to evolve fiscal policy in the public interest and to act upon the same. Equally, the Government is left free to determine priorities in the matters of allocations or allotments or utilization of its finances in the public interest. It is equally entitled, therefore, to issue or withdraw or modify the export or import policy in accordance with the scheme evolved. We, therefore, hold that the petitioners have no vested or accrued right for the issuance of permits on the MEE or NQE, nor is the Government bound by its previous policy. It would be open to the Government to evolve the new schemes and the petitioners would get their legitimate expectations accomplished in accordance with either of the two schemes subject to their satisfying the conditions required in the scheme. The High Court, therefore, was right in its conclusion that the Government is not barred by the promises or legitimate expectations from evolving new policy in the impugned notification.
In S.B. International Ltd. and Others Vs. Asstt. Director General of Foreign Trade and Others, the Apex Court has also considered the change in policy decision with respect to license. There was change in value addition norm. Application for the license was filed on the basis of the norm then prevailing but subsequently at the time of issuing the license, value addition norm enhanced pursuant to change in the policy decision and it was held that date of issue of license and not the date of application would govern the value to be applicable. No vested right accrued to the licensee for issuance of advance license as per value addition norm in vogue on the date of filing the application. It is a matter of policy decision of the Government.
Thus, in view of the aforesaid discussion and decisions of the Apex Court, amendment made in Rule 7 by inserting sub rule (iv) prescribing maximum period of license to be five years and thereafter, renewal for every subsequent five years cannot be said to be arbitrary or illegal or ultra vires the Constitution.
The Learned Counsel appearing on behalf of the petitioner has placed reliance on the decision of the Apex Court in Dilharshankar C. Bhachech Vs. Controller of Estate Duty, Ahmedabad, wherein it was held that levy of cess u/s 3 of Haryana Rural Development Fund Act cannot be said to be fee as quid pro quo is absent; it cannot also be levied as tax and thus, Section 3 is liable to be quashed. The decision is on the point that levy of cess u/s 3 is not a fee but it is a tax not leviable by the State. The decision has no application to the facts of the present case relating to application fee, fee for grant of license and security deposit for grant of license. The State Government is fully competent to revise the fee and the revision of fee cannot be said to be arbitrary or unreasonable or excessive or restrictive of the right to carry on occupation or trade or business.
Reliance has also been placed by the Learned Counsel for the petitioner on the decision of the Apex Court in Chandrakant Krishnarao Pradhan and Another Vs. The Collector of Customs, Bombay and Others, where the Apex Court has considered the provisions of Sections 202 (2), 9 of the Sea Customs Act (1878) (as amended in 1955) and the Customs House Agents Licensing Rules, 1960 framed thereunder. The question which arose whether rules offend Articles 14 and of the Constitution or go beyond rule making power u/s 202(2). As per majority, the Apex Court held that though the impugned rules are headed as framed u/s 202 of the Sea Customs Act, they cannot be questioned, if they carry out not only the special purposes of Section 202 but also certain other purposes of the Act because the two powers will concur to sustain them. It is only when a rule or rules are pointed out, which subserve neither the special purpose of the section nor the general purposes of the Act that they can be successfully questioned. Rule 10(c) of the Customs Houses Agent Licensing Rules, which confers a discretion on the Customs-Collector to reject a candidate if he is not otherwise considered suitable, is an unreasonable restraint upon the right of the Customs House Agents to carry on their avocation and Rule 11 when it prescribes a renewal fee of Rs. 50/- is invalid inasmuch as it has provided not for a fee but for a tax, subject to this, the rules do not offend against Articles 14 and 19 of the Constitution nor do they go beyond the rule making power conferred by Section 202(2) and are validly framed. The decision in the case of Chandrakant Krishnarao Pradhan (supra) is not applicable to the present case as it is not the tax which is being levied, but it is a fee for grant of license and its renewal. It cannot be said that by making revision in the application fee, fee for grant of license and permit and security deposit, any fetter has been put on the right of the members of the petitioner-Association to carry on their occupation or trade or business as contained in Article 19 (1)(g) of the Constitution.
In view of the discussion made above, the amendments made in Rules 6 and 7 of the Rajasthan Forest Produce (Establishment & Regulation of Saw Mills) Rules, 1983 vide notification AnnEx. 9 dated 13.1.2010 cannot be said to be arbitrary or illegal or violative of Article 19(1)(g) of the Constitution or ultra vires the Constitution. Resultantly, we find that the writ petition is devoid of merit and the same is hereby dismissed. The stay application is also dismissed. No costs.