Petition Nos
384681 6454 5580 230 249 502 510 524 726 27 777 96 803 1069 1207 091326439 4016071691 9317021703 7173436 1737 40 1759 72 1789 90 1879 1946 47 1948 1959 1972 97 2012 17 2027 39 2076 2077 78 2125 83 2194 95 2204 11 2284 2326 2361 622363 64 2365 24042405 26 2444 58 2459 882497 2501 2503 052513 19 2520 252542 73 2597 2616 412642 48 2661 63 2665 662698 2700 2702 21 2723 26 2730 44 2756 62 2766 76 2779 28022803 15 2818 26 2847 55 2856 67 2885 96 2897 98 2912 152917 26 2968 76 2980 3001 3002 46 3047 52 3070 87 3088 3102 3165 3205 3210 17 3259 64 3268 77 3286 3305 11 3312 2233253346 33553357 70 3371 91 3403 3477 823484 88 3492 35043505 15 35163517 343560 3572 79 3637 3693 3730 3732 36 3757 75 3899 39124053 694192 4229 42614329 4495 4496 45084606 09 4617 214622 69 4846 75 4978 86 52185349 5533 43 5597 5609 5623 5626 42 5728 5746 6577 81 6814 6934 427203 217 2074097454 567484 7641765977737943 7944 80848089 8090 81928195 8201 8431 8436 8834 8862 8878 81 8924  8979 of 1981
Under Article 32 of the Constitution Shanti Bhushan VM Tarkunde PA Francis and GN Dikshit
RK Jain PB Jain Pankaj Kaira section Mittar MG Gupta J BR Kapoor Miss Bhajan Ram Rakhyani SR Srivastava BV Tawakley Shobha Dikshit B Dutta BD Sharma Miss A Subhashini 513 NN Sharma TC Sharma A Ghosh SV Tambwekar and Girish Chandra for the appearing parties
A The Judgment of the Court was delivered by MISRA J
In exercise of powers conferred by section 3 of the  Sugar Control order 1966 was issued by the Government of India Ministry of Agriculture
Clause S of that order empowered the Central Government to issue directions inner alia to recognised dealers regarding production maintenance of stock storage sale grading packing making weighment disposal delivery and distribution of sugar
By Order No GSR 410 EEss
ComSugar dated the 14th of July 1980 the Central Government issued the following directions In exercise of the powers conferred by clause 5 of the Sugar Control order 1966 and in supersession of the order of the Government of India in the Ministry of Agriculture Department of Food No GSR 60 eEss
ComSugar dated the 26th February 1980 the Central Government hereby directs that no recognised dealer shall keep in stock at any time 1 Vacuum pan sugar in the places mentioned below in excess of the quantities mentioned against each i in Calcutta and extended area a recognised dealers who import sugar from outside West Bengal 3500 quintals b other recognised dealers 250 quintals ii in other places a in cities and towns with a population of one lakh or more 250 quintals b in other towns with a population of less than one lakh 100 quintals
514 2 Khandsari open pan sugar in excess of 250 quintals
Provided that no recognised dealer shall hold any stock of Vacuum pan sugar or Khandsari open pan sugar for a period exceeding ten days from the date of receipt by him of such stock of sugar or Khandsari
Provided further that nothing in this order shall apply to the holding of stocks of sugar i on Government account or ii by the recognised dealers nominated by a State Government or an officer authorised by it to hold such stock for distribution through fair price shops or iii by the Food Corporation of India
Explanation For the purpose of this order Calcutta and extended area means the areas specified in the Schedule to the notification of the Government of West Bengal No 7752 FS14 R 9261 dated the 16th December 1964
 The petitioners in this groups of petitions who are dealers in sugar seek to challenge the constitutional validity of the said order on three grounds I the impugned order is not covered by section 3 of the and is Ultra vires 2 the impugned order imposes unreasonable restrictions on the right of the petitioners to carry on their trade and so it is violative of Article 192g of the Constitution 3 the impugned order is also violative of Article 14 of the Constitution for two reasons as the petitioners have been singled out for hostile treatment from other dealers of sugar at Calcutta b the impugned order is unreasonable and impracticable
Shri Shanti Bhushan senior counsel appearing in one of the petitions viz Writ Petition No 3846 of 1981 took up the first point
and urged that the impugned order is not covered by any of the clauses of section 3 of the 
Section 3 of the  insofar as it is material for the purposes of this case reads 515 3
1 If the Central Government is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices or for securing any essential commodity for the defence of India or the efficient conduct of military operations it may by order provide for regulating or prohibition the production supply and distribution thereof and trade and commerce therein 2 With prejudice to the generality of the powers conferred by sub section 1 an order made thereunder may provide a   b   c  d for regulating by licences permits or otherwise the storage transport distribution disposal acquisition use of consumption of any essential commodity
 The language of section 3 1 coupled with clause d of subsection 2 of section 3 is wide enough to cover the impugned order
Section 3 1 authorises the Central Government to pass an order for regulating or prohibiting the production supply and distribution of an essential commodity and trade and commerce therein if it is of opinion that it is necessary or expedient to do so for securing the equitable distribution and availability
at a fair price of the essential commodity
The same power has been made more specific by clause d of sub section 2 of section 3 which provides for regulating by licences
permits or otherwise the storage transport distribution disposal acquisition use or consumption of any essential commodity
Sugar which term includes khandsari is an essential commodity and over the years it has become a scarce commodity
In the public interest it became essential to pass the impugned order to secure its equitable distribution and availability at fair prices
To that end it became necessary to prevent hoarding and black marketing
The expression to secure their equitable distribution and availability at fair prices is wide enough to cover the impugned order
Likewise the expression storage and distribution used in clause d of sub section 2 of section 3 should be given a liberal construction to give effect to the legislative intent of public welfare
So construed the impugned order is fully pro 516 tected and is not ultra vires section 3 of the  195 5
This leads us to the second contention namely the impugned order being violative of Article 19 1 g of The Constitution inasmuch as it imposed unreasonable restriction on the right of the petitioners to carry on trade or business
A person has a right to carry on any occupation trade or business and only restriction on this unfettered right is the authority of the State to make a law imposing reasonable restrictions under clause 6
The expression reasonable restrictions  signifies that the limitation imposed on a person in enjoyment of that right should not be arbitrary or of an excessive nature beyond what is required in the interest of the public
No cut and dry test can be applied to each individual statute impugned nor an abstract standard or general pattern of reasonableness can be laid down as applicable in all cases
The Court in each case has to strike a proper balance between the freedom guaranteed by Article 19 1 g and the social control permitted by clause 6 of Article 19
By the impugned order the Central Government has only put an embargo on the dealers on keeping sugar in excess of the quantity specified
It was passed only with a view to prevent hoarding and black marketing and to ensure equitable distribution and availability of sugar at fair prices in the open market
Reliance was placed by Shri Shanti Bhushan on State of Mysore vs H sanjeeviahJ In that Case the State Government of Mysore had framed rules to regulate the transit of timber firewood charcoal and bamboos from all lands in exercise of powers conferred by section 37 of the Mysore Forest Act 11 of 1900
By rule 2 framed on October 13 1952 it was provided that no person shall import forest produce into export forest produce from or move forest produce within any of the areas specified in Schedule A unless such forest produce is accompanied by permit prescribed in rule 3
On April 15 1959 the State of Mysore issued a notification adding a proviso to rule 2 which read as follows 517 Provided that no such permit shall authorise any person to transport forest produce between SUN set and sun rise in any of the areas specified in Schedule A By another notification dated September 14 1960 the State Government introduced the second proviso to rule 2 which read provided further that permission may be granted to timber merchants on their request to transport timber upto 10 pm 22 hrs under the following conditions i the party who wishes to avail of the concession should pay a cash deposit of Rs 1000 as security for the compliance with the timber transit rules as in force ii that the deposit may be forfeited to government for breach of any of the conditions of the timber transit rules
 The dealers in timber challenged the two provisos on the grounds inner alia that they were beyond the rule making authority conferred upon the State Government by section 37 of the Mysore Forest Act 11 of 1900 and in any event the provisos imposed unauthorized restrictions on the freedom of trade commerce and intercourse
The High Court held that the State Government while seeking to regulate the transport of timber stopped transport altogether
This Court upholding the order of the High Court observed Power to impose restrictions of the nature contemplated by the two provisos to r 2 is not to be found in any of the clauses of sub section
2 of section 37
By sub section
I the State Government is invested with the power to regulate trans port of forest produce in transit by land or water
 The power which the Stale Government may exercise is however power to regulate transport of forest produce and not the power to prohibit or restrict transport
Prima facie a rule which totally prohibits the movement of forest produce during the period between sun set and sun rise is prohibitory or restrictive of the right to transport forest produce
A rule regulating transport in its essence permits transport subject to certain conditions devised to promote trans port
 518 This Court further observed If the provisos are in truth restrictive of the right to transport the forest produce however good the grounds apparently may be for restricting the transport of forest produce they cannot on that account transform the power conferred by the provisos into a power merely regulatory The facts of the present cases are materially different from the facts of H Sanjeeviah s case supra
In that case the impugned provisos to rule 2 completely prohibited the transport of the forest produce between sun set and sun rise
But in the cases in hand the direction enjoined a recognised dealer not to keep sugar in stock at any time in excess of the quantity specified therein
It only seeks to regulate the limit of storage of sugar and does not prohibit its storage
The case of H Sanjeeviah therefore is not of much help to the petitioners herein
In Ms Laxmi Khandsari  Ors
vs State of UP  orsl this Court made the following observations about reasonable restrictions on the right conferred by Article 19 1 g of the Constitution in the following terms As to what are reasonable restrictions would naturally depend on the nature and circumstances of the case the character of the statute the object which it seeks to serve the existing circumstances the extent of the evil sought to be remedied as also the nature of restraint or restriction placed on the rights of the citizen
It is difficult to lay down any hard and fast rule of universal application but in imposing such restrictions the State must adopt an objective standard amounting to a social control by restricting the right of the citizens where the necessities of the situation demand
The restrictions must be in public interest and are imposed by striking a just balance between the deprivation of right and the danager or evil sought to be avoided
If the restrictions imposed appear to be consistent with the directive principles of State policy they would have to be upheld as the same would be in public 519 interest and manifestly reasonable
Further restrictions may be partial complete permanent or temporary but they must bear a close nexus with the object in the interest of which they are imposed
Another important test is that restriction should not be excessive or arbitrary
The court must examine the direct and immediate import of the restrictions on the rights of the citizens and determine if the restrictions are in larger public interest while deciding the question that they contain the quality of reasonableness
In such cases a doctrinaire approach should not be made but care should be taken to see that the real purpose which is sought to be achieved by restricting the rights of the citizens is sub served
At the same time the possibility of an alternative scheme which might have been but has not been enforced would not expose the restrictions to challenge on the ground that they are not reasonable
 Judged in that light and on an overall consideration of the various aspects of the matter restrictions put by the impugned order can by no means be said to be unreasonable
It is only regulatory and not prohibitory
We now take up the last contention namely the impugned order being violative of Article 14 of the Constitution
The learned counsel seeks to invoke Article 14 on two grounds 1 the impugned order applies two standards one for the dealers at Calcutta who had been authorised to keep 3500 quintals at one time while the dealers at other places have been authorised to keep only 250 quintals in cities with a population of one lakh or more and only 100 quintals in other towns with a population of less than one lakh
F The fixation of limits for storing sugar in Calcutta and other places is not arbitrary but is based on reasonable classification
The government is the best judge of the situation in a particular State and that quantity of sugar will meet the exigencies of the situation at a particular place is purely a governmental function
For one Calcutta serves as a feeder line to meet the requirements of sugar to the eastern part of the country and therefore the stocks of sugar to be held by the dealers in Calcutta are not required for consumption in Calcutta alone Besides Calcutta being far away from the sugar manufacturing units in Bihar and Uttar Pradesh from where bulk of supplies are obtained sugar is transported by the wholesale 520 dealers in railway wagons which take sometime unusually longer time in transit
These and various other factors have been taken into consideration by the Government while fixing the storage limits of sugar for the dealers in Calcutta
His second ground for invoking Article 14 of the Constitution is that the impugned order is unreasonable and impracticable in that no dealer can be sure of the sale of sugar on any particular day
If per chance a dealer is not able to dispose of the excess sugar on a particular
day he would expose himself to punishment under the Act
No provision has been made in the order or in the rules for the purchase by the Government of the excess sugar
For the State it was contended that similar orders with regard to wheat came up for consideration in this Court in Suraj Mal Kailash Chand Ors
vs Union of India  Anr
and Bishambhar Dayal Chandra Mohan Ors
vs State of Uttar Pradesh  ors
etc2 when this Court upheld the validity of these orders
In view of the decision of this Court in those cases it is not open to Shri Shanti Bhushan to challenge the constitutional validity of the impugned order
Shri Shanti Bhushan however refutes the argument and says that those decisions do not stand in the way of the petitioners
The situation with regard to wheat was quite different inasmuch 
s clause 25 of the impugned order in Sutlaj Mal s case supra provided that the State Government or the Collector or the Licensing Authority may issue directions to any dealer with regard to purchase sale disposal storage or exhibition of the price and stock list of all or any of the trade articles
But there is no such provision in the impugned order in the instant case and therefore the dealers can expose themselves to punishment merely because at any particular point of time the stock was in excess of the prescribed limits
Bishambhar Dayal s case supra also related to wheat
There was a scheme for the procurement of wheat by the State Government but there is no such scheme in respect of sugar
This fact distinguishes the present case for the facts of the aforesaid decision
The argument though attractive cannot be accepted
Over the years sugar has become a scare commodity and people have to 521 purchase it even at a prohibitive price
In the circumstances it A cannot be expected that the dealers would not be able to sell the sugar in their stock
There is absolutely no difficulty in selling the sugar at any time at the prevalent market price
If in a rare case there is difficulty on that score we hope and trust that the concerned Government would allow a reasonable time within which the petitioners are permitted to dispose of the excess quantity of sugar if any
In any case in some given case there may be some hardship but it cannot be said on that account that the impugned order is violative of Article 14 of the Constitution
For the foregoing discussion the writ petitions must fail
They are accordingly dismissed
In the circumstances of the case there shall however be no order as to costs
SR Petitions dismissed


Summary:
In exercise of powers conferred by section 3 of the  Sugar Control order 1966 was issued by the Government of India Ministry of Agriculture Clause 5 of that order empowered the Central Government to issue directions inter alia to recognised dealers regarding production maintenance of stock storage sale grading packing making weighment disposal delivery and distribution of sugar
By order No GSR 410 EEss
ComSugar dated 14 7 1980 the Central Government issued directions to the effect that no recognised dealer shall keep in stock at any time a Vacuum pan sugar in excess of i in Calcutta and other extended area recognised dealers who import sugar from outside West Bengal 3500 quintals other recognised dealers 250 quintals ii in other places in cities and towns with a population of one lakh or more 250 quintals and with a population of less than one lakh 100 quintal and b Khandsari open pan sugar 250 quintals
Further no recognised dealer shall hold any stock of vacuum pan sugar or khandsari open pan sugar for a period exceeding 10 days from the date of receipt by him of such stock of sugar or khandsari
The recognised dealers there fore assailed the constitutional validity of the said order on three grounds I the impugned order is not covered by section 3 of the and is ultra vires 2 the impugned order imposes unreasonable restrictions on the right of the petitioners to carry on their trade and so it is violative of Article 19 1 g of the Constitution 3 the impugned order is also violative of Article 14 of the Constitution for two reasons a the petitioners have been singled out for hostile treatment from other dealers of sugar at Calcutta b the impugned order is unreasonable and impracticable
Dismissing the petitions the Court  HELD 1 The order dated 14 7 1980 is not ultra vires section 3 of the 
The expression to secure their equitable 511 distribution and availability at fair prices is wide enough to cover the impugned order Likewise the expression storage and distribution used in clause d of sub section 2 of section 3 of the essential Commodities Act 1955 should be given a liberal construction to give effect to the legislative intent of public welfare
Sugar which term includes khandsari is an essential commodity and over the years it has become a scarce commodity
In the public interest it became essential to pass the order to secure its equitable distribution and availability at fair prices
To that end it became necessary to prevent hoarding and black marketing
515 F H 516 A E 2
Restrictions put by the impugned order can by no means be said to be unreasonable
It is only regulatory and not prohibitory
The direction enjoined recognized dealer not to keep sugar in stock at any time in excess of the quantity specified therein
It only seeks to regulate the limit of storage of sugar and does not prohibit its storage
By the Impugned order the Central Government sought to prevent hoarding and black marketing and to ensure equitable distribution and availability of sugar at fair prices in the open market516 E 519 D A person has a right to carry on any occupation trade or business and the only restriction on this unfettered right is the authority of tho State to make a law imposing reasonable restrictions under clause 6
The expression reasonable restrictions  signifies that the limitation imposed on a person in eojoyment of that right should not be arbitrary or of an excessive nature beyond what is required in the interest of the public
No cut and dry test can be applied to each individual statute impugned nor an abstract standard or general pattern of reasonableness can be laid down as applicable in all cases
The Supreme Court in each case has to strike a proper balance between the freedom guaranteed by Article 19 1 g and the social control permitted by clause 6 of Article 19
516 B D State of Mysore vs H Sanjeeviah  explained and distinguished
Ms Laxmi Khandsari  Ors
vs State of UP  Ors  followed
The order is not violative of Article 14 of the constitution
The fixation of limits for storing sugar in Calcutta and other places is not arbitrary but is based on reasonable classification
The government is the best judge of the situation in a particular State and what quantity of sugar will meet the exigencies of the situation at a particular place is purely a governmental function
For one Calcutta serves as a feeder line to meet the requirements of sugar to the eastern part of the country and therefore the stocks of sugar to be held by the dealers in Calcutta are not required for consumption in Calcutta alone
Besides Calcutta being far away from the sugar manufacturing units in Bihar and Uttar Pradesh from where bulk of supplies are obtained sugar is transported by the wholesale dealers in railway wagons which take sometime unusually longer time in transit
These and various other factors have been taken into consideration by the Government while fixing the storage limits of sugar for the dealers in Calcutta
519 F H 520 A 512 The fact that over the years sugar has become a scarce commodity and people have to purchase it even at a prohibitive price the dealers would be able to sell the sugar in their stock without difficulty at any time at the prevalent market price
In a rare exceptional case there may be some hardship on that score but it cannot be said on that account that the order is violative of Article 14 of the Constitution
In such cases we hope and trust that the concern ed Government would allow a reasonable time within which the dealers could dispose of the excess quantity of sugar if any
520 G 5 21 A C Suraj Mal Kailash Chand  Ors
vs Union of India  Anr Writ Petitions Nos
8334 48 of 1981 decided on September 25 1981 unreported case Bishambhar Dayal Chandra Moharl  ors etc
vs State of Uttar Pradesh  Ors etc
Writ Petitions Nos
2907 2908 of 1981 and connected writ petitions a group of SOS writ petitions decided on November S 1981 followed