IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 21.06.2011 CORAM: THE HONOURABLE MR. JUSTICE T.RAJA WP.No.9187 of 2011 MP.Nos. 1 to 3 of 2011. Selvam Modern Rice Mill, rep by its Proprietor, S.Saravanan, S/o.T.Selvam, Thirukanurpatti, Tanjore District. .. Petitioner Vs. 1.The Managing Director, TamilNadu Civil Supplies Corporation, Tambusamy Street, Kilpauk, Chennai-10. 2.The Senior Regional Manager, Tamil Nadu Civil Supplies Corporation, Tanjore. .. Respondents Prayer : Writ petition filed under Article 226 of the Constitution of India praying for the issuance of Writ of Certiorarified Mandamus to call for the records relating to the order passed by the 1st respondent in his proceedings Sae.Mu.No.M.H.4/29225/09, dated 24.12.2009 confirming the order passed by the 2nd respondent in his proceedings No.Na.Ka.No.G2/006560/09, dated 27.04.2009 and quash the same and consequently directing the respondents to supply the paddy to the petitioner's rice mill for hulling purpose as continuously. For Petitioner : Mr.C.Prakasam For respondents : Mr.V.Selvanayagam for R1 and R2. ORDER The petitioner Selvam Rice Mill has come to this court by filing the present writ petition to call for the records relating to the order passed by the 1st respondent in his proceedings Sae.Mu. No.M.H.4/29225/09, dated 24.12.2009 confirming the order passed by the 2nd respondent in his proceedings No.Na.Ka.No.G2/006560/09, dated 27.04.2009 and to quash the same and consequently to direct the https://hcservices.ecourts.gov.in/hcservices/ respondents to supply the paddy to the petitioner's rice mill for hulling purpose as continuously. 2. The petitioner herein is owning a modern rice mill in the name and style of Selvam Modern Rice Mill for the past several years. He was appointed as Hulling Agent for Tamil Nadu Civil Supplies Corporation. From the date of his appointment, he has no remarks over supply of rice to the Tamil Nadu Civil Supplies Corporation. While so, the respondents 1 and 2 inspected the petitioner's rice mill on 23.03.2009, verified the stock position of the paddy supplied by them with resultant rice and found that there was shortage of 21.843 metric ton in so far as it relates to resultant rice and also found the excess empty gunny bags numbering 1320 in the petitioner's rice mill. Hence, the 2nd respondent issued a show cause notice to the petitioner. The petitioner also submitted his explanation on 18.04.2009. The 2nd respondent not being satisfied with the explanation submitted by the petitioner, passed the impugned order on 27.04.2009 stating that the petitioner is responsible for the said shortage and also imposed penalty, by cancelling the hulling agency. Aggrieved by the said order, the petitioner also preferred an appeal before the first respondent who also confirmed the order passed by the 2nd respondent. The said order is challenged in this writ petition. 3. It is the case of the petitioner that the respondents have failed to consider that the respondents official themselves accepted that they have supplied damaged rice to the petitioner's mill, therefore, the petitioner could not produce 68% of the resultant rice. While so, the respondents cannot once again find fault with the petitioner, since the entire issues were settled including the shortage of rice mill that too after accepting the explanation. In view of supply of sub standard damaged paddy to the petitioner, the petitioner was not able to produce 68% of resultant rice, hence the order passed by the 2nd respondent on 27.04.2009 cancelling the hulling agency given to the petitioner is legally unsustainable. It was further submitted that when there was a shortage of supply of rice, the petitioner purchased the equivalent rice from outside and tendered the resultant rice, for which the respondents cannot impose severe penalty on the petitioner and at worst respondents may deduct from petitioner's security deposit, but cancelling the licence is illegal and arbitrary. On that basis, he prayed for setting aside the order passed by the 2nd respondent as confirmed by the first respondent. 4. A detailed counter affidavit has been filed, stating that the paddy consignments received from various direct purchase centres have been diverted to Hulling centers from Santhanam Godown, Thanjavur for processing. On receiving information over phone on 23.03.2009 that some of the paddy loads diverted to the petitioner's rice mill at Arputhapuram, Thanjavur, had not actually reached the https://hcservices.ecourts.gov.in/hcservices/ mill and parked in front of cap storage at Pillayarpatti, the inspection officials/respondents visited the spot and enquired the Driver of Lorry No.TN45 Y 1516 about the transaction. On enquiry, the driver of the lorry stated that 300 bags of Raw Paddy loaded at the petitioner's rice mill has been brought to cap storage at Pillayarpatti without any truck memo. Subsequently, the truck memo was obtained from the Direct Purchase centre Thirukarukavur. On further enquiry, it was stated that on 12.03.2009 one load of paddy despatched from direct purchase centre, Ukkadi in Papanasam Taluk vide truck memo No.33472, dated 12.03.2009 and diverted to petitioner's Rice Mill at Arputhapuram, Thanajur vide Memo No.10640, dated 12.03.2009 at Santhanam Godown was taken to the mill and parked in front of cap storage Pillayarpatti for unloading by getting one truck memo from direct purchase centre, Vadakkur (truck memo No.29289, dated 13.03.2009) and unloaded at cap storage, Pillaiyarpatti. On 18.03.2009 one load of Raw Paddy with 265 bags vide memo No.22480 despatched from direct purchase centre, Ukkadai in Papanasam Taluk was diverted to the petitioner's Rice Mill at Arputhapuram, Thanjavur vide issue Memo No.16208, dated 18.03.2009. This load was not actually taken to the mill and parked in front of cap storage Pillaiyarpatti for unloading. The lorry was unloaded by getting another Truck Memo No.29293, dated 18.03.2009 from Direct Purchase Centre, Vadakkur in Orathanadu Taluk and unloaded at Cap storage, Pillaiyarpatti, Thanjavur on 21.03.2009. In this way, the petitioner has diverted three loads of paddy to the open market and encashed through direct purchase centers. 5. Therefore, the second respondent after receiving the explanation from the petitioner, being dissatisfied with the explanation passed the rightful order by dismissing his appeal. When the same was taken up on appeal before the first respondent, the first respondent also confirmed the same. Therefore, it was submitted that when the 2nd and 1st respondent have considered the case of the petitioner on the basis of various documents including the petitioner's explanation, the said findings cannot be questioned in the present writ proceedings. Further, the inspection report dated 24.03.2009 submitted by the 2nd respondent also revealed that there was a huge shortage of rice to the tune of 21.843 MTs. and again the rice shortage in equivalent to paddy was at the rate of 32.122 MTs. and 1320 gunny bags were found excess. Therefore, on the basis of the explanation of the Hulling Agent/the petitioner herein, it was found that a shortage of 32 MTs. of paddy was noticed at the mill and the further deposition given by the lorry driver has clearly exposed the illegal transaction, therefore, the 2nd respondent stopped further issue of paddy to the petitioner for hulling purpose. Even the explanation submitted by the petitioner in the show cause notice issued by the 2nd respondent to explain as to why a sum of Rs.6,57,239/- being the loss sustained to the respondent corporation should not be adjusted from his hulling charge bills, was found neither acceptable nor convincing. Therefore, an order cancelling https://hcservices.ecourts.gov.in/hcservices/ the appointment of Hulling Agency of the petitioner was passed. Further, an appeal, the 1st respondent also held that the petitioner has caused a loss to the tune of Rs.6,57,239/- to the respondent corporation by non depositing of 21.843 MTs. of resultant rice. When the petitioner, as a Hulling Agent, has violated the terms and conditions of the agreement executed with the respondent corporation, the order cancelling the agency of hulling is found to be in order. 6. Accordingly, I do not find any merit in the writ petition and hence, the present writ petition fails and stands dismissed. No Costs. Consequently, connected miscellaneous petitions are closed. Sd/ Asst. Registrar /true copy/ Sub Asst.Registrar tsh To 1.The Managing Director, TamilNadu Civil Supplies Corporation, Tambusamy Street, Kilpauk, Chennai-10. 2.The Senior Regional Manager, Tamil Nadu Civil Supplies Corporation, Tanjore. 1 cc To Mr.V.Selvanayagam, Advocate, SR.35929 1 cc To Mr.C.Prakasam, Advocate, SR.35841 WP.No.9187 of 2011 KSJ (CO) RH (11.7.11) https://hcservices.ecourts.gov.in/hcservices/