SCR.A/300/2008 1/6 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CRIMINAL APPLICATION No. 300 of 2008 For Approval and Signature: HONOURABLE MS.JUSTICE H.N.DEVANI ========================================= = 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================= = STATE OF GUJARAT - Applicant(s) Versus HITESHKUMAR NANDLAL TANNA - Respondent(s) ========================================= = Appearance : MR LB DABHI, ADDL. PUBLIC PROSECUTOR for Applicant(s) : 1, None for Respondent(s) : 1, ========================================= = CORAM : HONOURABLE MS.JUSTICE H.N.DEVANI Date : 10/03/2008 ORAL JUDGMENT 1. By this application under Article 226 of the Constitution of SCR.A/300/2008 2/6 JUDGMENT India, the petitioner – State of Gujarat has challenged the order dated 28th December, 2007 passed by the learned Additional Sessions Judge, Junagadh in Criminal Appeal No.4 of 2006, whereby the learned Additional Sessions Judge has partly allowed the appeal preferred by the respondent herein and reduced the value of the goods confiscated to 10% of the original amount as directed by the Collector, Junagadh vide order dated 14th November, 2005 passed in Case No.Food/Enfo/ESA/40/05. 2. The facts stated briefly are that, pursuant to a search carried out on the premises of the respondent, Civil Supply Officers, Junagadh had seized certain goods in connection with certain irregularities noticed by the search team. Subsequently, a show cause notice was issued to the respondent under Section 6[b] of the Essential Commodities Act, 1955 (the Act) calling upon the respondent to show cause as to why action should not be taken against him in respect of breach of the provisions of Section 3 of the Act. The respondent submitted his reply mainly contending that edible oil is no longer an essential commodity under the provisions of the Essential Commodities Act and under the Essential Articles (Licensing, Control and Stock Declaration) Order, 1981 (the Essential Articles Order), and therefore, the provisions of the Act would not apply to the respondent. The Collector, Junagadh vide order dated 3rd January 2006 has held that the irregularities alleged against the respondent were proved and directed confiscation of the entire stock that had been seized amounting to Rs.66,380/-. Being aggrieved, the respondent filed an SCR.A/300/2008 3/6 JUDGMENT appeal before the learned Sessions Judge, Junagadh under the provisions of Section 6(C) of the Act. 3. The learned Sessions Judge vide the impugned order dated 28th December, 2007 found that, of the three irregularities alleged against the respondent, the first irregularity, namely, failure to place the board mentioning the stock is exfacie a minor irregularity; that the second irregularity, namely, non-maintaining of stock register on day to day basis can also be termed as a technical irregularity; and the third irregularity, namely, finding of 23 excess groundnut oil tins cannot be termed to be an irregularity at all; that technically the stock in the register should match the actual stock and that inference of black marketing is possible when there is deficiency in stock qua the stock mentioned in the register. That excess stock is prima facie a technical irregularity. The learned Judge, after arriving at the aforesaid conclusion, held that the ends of justice would be met if the penalty is reduced from 100% to 10%. He, accordingly, quashed the order dated 11th November, 2005 passed by the Collector, Junagadh. Being aggrieved, the State of Gujarat has filed this petition, challenging the said order. 4. Heard Mr.L.B.Dabhi, learned Additional Public Prosecutor for the petitioner – State of Gujarat. It is submitted that the learned Judge has erred in modifying the order passed by the Collector and directing confiscation by reducing 10% of the value of the goods. It is submitted that though the respondent may not be governed by the provisions of the Essential Articles Order, he would still be SCR.A/300/2008 4/6 JUDGMENT a dealer under the provisions of the Gujarat Essential Articles Dealers (Regulation) Order, 1977 (Dealers Order) and would, therefore, be governed by the provisions of the said Order. It is submitted that, in the circumstances, the petitioner was bound to comply with the provisions of the Dealers Order and as such, the order passed by the Collector, Junagadh holding that there was breach of the provisions of the Dealers Order was just, proper and legal, and did not call for any intervention on the part of the Sessions Court. 5. A perusal of the record of the case shows that the allegations against the respondent herein are (i) failure to place the board mentioning stock, (ii) non-maintaining of stock register on day to day basis, and (iii) twenty-three excess groundnut oil tins were found during the course of the inspection. 6. The learned Sessions Judge, Junagadh, after considering the evidence on record, has found that the first irregularity, namely, failure to place the board mentioning the stock is a minor irregularity, which cannot be given undue weightage. The learned Judge has found that, insofar as non-maintaining of stock register on day to day basis is concerned, the petitioner has offered an explanation that, in view of the notification dated 15th February, 2005 issued by the Central Government, he was no longer required to obtain a license for doing the business of edible oil. Thereafter, under the bonafide belief that he is no longer required to maintain the register, he had given up maintaining the stock register SCR.A/300/2008 5/6 JUDGMENT on a day to day basis. The learned Judge has also recorded that, during the course of inspection, the respondent had produced the statement for the period in respect of which entries had not been made in the register which did not reflect that the respondent had indulged in black marketing or profiteering or that he has not maintained the register regularly in an attempt to receive such unjust benefit. In the facts of the present case, the respondent had supplied necessary material instantly on the date of the inspection which is also recorded in the panchnama. The learned Judge has found that the Collector, Junagadh has not dealt with the aforesaid explanation tendered by the respondent. Applying the test laid down in the case of M.D.Agency v. State of Gujarat, 1997(2) GCD 439, the learned Judge found that the irregularities found in the present case can at best be termed as technical irregularities. As regards the third irregularity, the learned Judge has found that the finding of twenty-three excess groundnut oil tins cannot be termed to be an irregularity at all. According to the learned Judge, technically the stock register should match the actual stock. The inference of black marketing is possible when there is a deficiency in the stock qua the stock mentioned in the register. Excess stock would be prima facie a technical irregularity. The learned Judge recorded a finding of fact that at the time of inspection, the respondent had produced the statements of the intervening period and the authority had not found anything suspicious in the statement. It is after recording the aforesaid findings of fact that the learned Judge has found that, considering the fact that the irregularities SCR.A/300/2008 6/6 JUDGMENT were only technical irregularities, no case was made out for confiscating the entire seized stock and had found that the ends of justice would be met if the penalty is reduced from 100% to 10%. This Court is in full agreement with the reasoning adopted by the learned Sessions Judge while partly allowing the appeal of the respondent. 7. For the foregoing reasons, this Court finds no infirmity in the order passed by the learned Sessions Judge, so as to warrant any intervention at the hands of this Court. In the result, the petition fails and is, accordingly, rejected. [HARSHA DEVANI, J.] parmar*