THE HON’BLE SRI JUSTICE NOUSHAD ALI WRIT PETITION No.21936 OF 2008 BETWEEN: 1. M/s. Keerthana Traders, D.No.28/252/2, Noonepalli, Nandyal, rep. by its Proprietor M. Janardhan, S/o. M.A.Narayana, and others. …. PETITIONERS And 1. The Dostrict Collector, Kurnool, Kurnool District, and others. …. RESPONDENTS Counsel for petitioners: Sri K.V. Raghuveer Counsel for respondents: G.P. for Civil Supplies The Court made the following order: ORDER: 1. The petitioner-firms are registered dealers authorized to conduct business of selling and storing of Pulses under the provisions of A.P. Pulses (Licensing, Storage and Regulation) Order, 2007/A.P. Scheduled Commodities Dealers (Licensing and Distribution) Order, 1982, (for short ‘the Control Order’). The 1st petitioner holds licence No.FGL/Pulses/33/2006, and the petitioners 2 and 3 hold licence Nos.FGL/Pulses/255/2006 and FGL/Pulses/254/2006 respectively. They filed this writ petition challenging the order dated 20.09.2008 in ROC.No.DSO/CS1/EC.No.120/2008, whereby the 1st respondent ordered confiscation of certain quantities of red gram, i.e., 421.40 quintals of the 1st petitioner and 474.37 quintals and 969.13 quintals of the petitioners 2 and 3 respectively, purportedly under Clause 6-A (1) of the Essential Commodities Act, 1955 (for short the Act’). 2. The Deputy Tahsildar (Civil Supplies), Koilakuntla inspected the premises viz., Kisan Rural Warehouse, situated at Maseedpuram, Mahanandi Mandal on 24.07.2008 and verified the red gram stock available with reference to the stock register. He found a total stock of 8518.50 quintals, out of which 3,124.54 quintals was belonging to six traders including the three writ petitioners herein, and the balance of 5,393.96 quintals was in the name of 42 benami farmers. The Deputy Tahsildar verified the pattadar passbooks and found variation between the acreage and stocks. On the basis of the said inspection, the Deputy Tahsildar submitted a report concluding that the stock was hoarded in unlicenced premises in the name of benami farmers and the premises inspected viz., Kisan Rural Warehouse, was not an authorized storage point for any of the petitioners. On the said basis, alleging contravention of the Control Order, the Inspecting Officer seized the entire stock of 8,518.50 quintals of Red Gram and handed over to one Y.Shankar Reddy said to be the Manager and brother of the owner of the warehouse, for safe custody. 3. The learned counsel for the petitioners would submit that the said stock is still lying in the warehouse, despite the District Manager APSCSC, Kurnool, was instructed to take possession of the sized stock and dispose of the same through public distribution system. Upon seizure of the said stock, the petitioners submitted a petition to 1st respondent through Advocate and sought for release of stocks, pending enquiry. The 1st respondent herein issued notice dated 29.08.2008 in Rc.SDC/CS-1/EC No.120/2008, to the petitioners to attend for hearing before the District Collector, Kurnool, on 6.09.2008. Accordingly, the matter was heard by the 1st respondent. The petitioners sought to establish that they did not commit any contravention of the Control Order. It was the contention of the petitioners that Kisan Rural Warehouse, where the Red Gram was stored, is also an authorized point as per the licence held by them. According to them they had informed the Licensing Authority that in addition to the existing authorized points, Kisan Rural Warehouse would be an additional storage point in respect of each of the petitioners. They also sought to justify non-submission of C-Form returns, which is a violation of Clause 18(c) of the Control Order, on the ground that non-submission of C-Form returns is a technical irregularity, which should not attract serious punishment of confiscation of seizure of stock. The 1st respondent thereupon passed the following order. “I am of the opinion that had the petitioner submitted ‘C’ Form return to the Licensing Authority regularly it would have clearly indicated the turn over of the business of the petitioner and the quantities of Red Gram being stored in the Godown.” Holding that hoarding of sized stock was with a mala fide intention for pecuniary gain, the 1st respondent ordered confiscation of the sized stock. It is against this order the petitioners have filed the present writ petition. 4. Heard learned counsel for the petitioners and learned Government Pleader for the respondents. 5. Learned counsel for the petitioners would contend that the 1st respondent ordered confiscation without having regard to the actual facts and without observing the mandatory provisions of Section 6-B of the Act. He would contend that the petitioners are authorized to store the stock at Kisan Rural Warehouse by virtue of the deeming provisions contained in the Control Order and that non-submission of C-Form returns should not be construed as violation of the Control Order. He would therefore contend that the impugned order is liable to be set aside. 6. On the other hand, the learned Government Pleader would deny the said contentions and submit that the order was validly passed. He would also submit that the notice dated 29.08.2008 itself should be construed as a notice under Section 6-B of the Act and that against the impugned order, an appeal would lie under Section 6-C of the Act to the District Court, and therefore the writ petition is not maintainable. 7. Admittedly, the petitioners are licensed traders to deal with pulses at the relevant point of time. Whether they were authorized to store the stocks at Kisan Rural Warehouse, whether they were indulging in hoarding the stock and whether their failure to submit C- Form returns would attract confiscation of entire stock, are the questions of fact in respect of which, I am not inclined to deal with in this writ petition in view of the specific stand taken by the petitioners that the impugned order was not preceded by a notice under Section 6-B of the Act. 8. The stock was seized by the Deputy Tahsildar (Civil Supplies) Koilakuntla on 24.07.2008. He submitted a report dated 25.07.2008 to 1st respondent. Based on the said report 1st respondent issued proceedings dated 26.07.2008 under Section 6-A of the Act and directed the District Manager, Civil Supplies Corporation, Kurnool to take possession of the seized stock and dispose of the same through public distribution system. He was also directed to remit the sale proceeds to the revenue account. The petitioners herein filed petitions before 1st respondent seeking release of stock in their favour. It is on such application, 1st respondent issued notice dated 29.08.2008 in RC.SDC/CS-1/EC No.120/2008, which reads as follows. The Special Team consisting with the following officials- 1. Sri K.H. Rahman, Deputy Tahsildar, (C.S.), Koilkuntla; 2. Sri T. Chakrapani, E.R.O. V & E, Kurnool, have seized 8518-50 Qtls. of Red Gram from Kisan Rural Warehouse on 24.07.2008. Interim Disposal orders were issued in this office reference 3rd cited pending enquiry M/s. Keerthana Traders, Nandyal, Lakshmi Narasimha Cotton Traders, Nandyal & Krishna Cotton Merchants, Nandyal filed petition through the Advocate Sri C. Satyanarayana, Kurnool, with a request to release the seized stocks on the plea that he has got licence and stored the pulses below permissible quantities. After perusal of the contents of the petition filed and the material available from this office records, it is hereby decided to give an opportunity of personal hearing to the Trader and therefore he is hereby requested to attend before the District Collector, Kurnool by 4.00 P.M. on 6.09.2008 in his chamber along with relevant evidences, if any. Failing which it will be construed that there is no more explanation with him and orders will be passed on the material available on records.” 9. After hearing the matter, the 1st respondent passed the impugned order dated 20.09.2008. A perusal of the notice extracted above and the references shown in the impugned order would clearly disclose that the 1st respondent was dealing only with the application filed by the petitioners for release of seized stock pending enquiry. Neither the notice dated 29.08.2008 nor the proceedings dated 20.09.2008 refer to issuance of any notice under Section 6-B of the Act. The petitioners, in paragraph-7 of their affidavit, have specifically asserted that the 1st respondent failed to issue show cause notice as contemplated under Section 6-B of the Act informing the grounds on which the confiscation was proposed and that he has issued only a notice for personal hearing on 20.09.2008, and the same is not in compliance with the provisions of Section 6-B of the Act. Even though the 1st respondent himself has filed counter affidavit, he neither traversed nor controverted the said specific contention. The 1st respondent by adverting to the notice dated 29.08.2008, however, sought to justify on the ground that the petitioners did not raise any objection for non-issuance of show cause notice under Section 6-B of the Act. Under Section 6-B of the Act, no order confiscating any essential commodity etc., shall be made under sub-section (1) of Section 6-A unless the owner of such essential commodity etc., is given a notice in writing informing him of the grounds on which he proposed to confiscate the essential commodity etc., and has given an opportunity of making a representation in writing within the specified time and also a reasonable opportunity of being heard in the matter. Under sub-section (3) of Section 6-B of the Act, no order confiscating any essential commodity etc., shall be invalid merely by reason of any defect or irregularity in the notice given under Clause (a) of sub-section (1), if, in giving such notice, the provisions of that clause have been substantially complied with. 10. As mentioned above, no notice as contemplated under Section 6-B (1) (a) of the Act has been given to the petitioners. The notice dated 29.08.2008 did not set out the grounds nor did it indicate the proposal. Thus the said notice did not even substantially comply with the requirements of Section 6-B for such confiscation. On the other hand, the said notice was given in pursuance of the applications made by the petitioners for release of the seized stock, pending enquiry. Therefore, it must be held that the confiscation ordered under the impugned order is voilative of the mandatory provisions contained in clause (a) of Section 6-B (1) of the Act. In view of the same, it is not possible to accept the submission of the learned Government Pleader that the notice dated 29.08.2008 itself should be construed as a notice under Section 6-B of the Act. 11. It is true that against the order of confiscation, an appeal is provided under Section 6-C of the Act. However, in a case where demonstrably there is violation of the principles of natural justice failure to follow the mandatory procedure or violation of a constitutional or fundamental right, an aggrieved party need not avail the alternative remedy. As I have held that the petitioners were not given notice, they need not avail remedy of appeal against the impugned order. 12. In the analysis as above, the impugned order dated 20.09.2008 in ROC.No.DSO/CS.1/EC.No.120/2008 is held to be unsustainable, and the same is accordingly set aside. Since I have set aside the impugned order only on the ground of non-issuance of notice under Section 6-B of the Act, the 1st respondent is always at liberty to issue notice as contemplated under Section 6-B of the Act and pass appropriate orders in accordance with law. 13. However, the learned counsel for the petitioners would submit that the stock having been seized on 24.07.2008 is still lying in the warehouse and the quality of the stock is getting deteriorated. He would therefore submit that the stock may be released on furnishing bank guarantee to the value of the seized stock. 14. Having regard to the facts of the case that the stock has been lying in the warehouse for more than two years, I deem it appropriate to direct the 1st respondent to release the seized stock on each of the petitioner furnishing bank guarantee equivalent to the value of the stock seized from each of them to the satisfaction of the 1st respondent. The bank guarantee shall be subject to the orders that may be passed under Section 6-A of the E.C. Act. 15. The writ petition is accordingly disposed of in the above terms. No costs. ________________ NOUSHAD ALI, J. 28th October, 2010 Js.