Case: Sri Vijaylakshmi Rice Mills, New Contractors Company Etc Vs. State of Andhra Pradesh

This batch of Appeals Nos. 805, 806 and 972 to 977 of 1973 by certificate from the judgments and decrees of the High Court of Andhra Pradesh in Appeals Nos. 766 of 1968, 18 of 1969, 779 of 1968, 780 of 1968, 782 of 19 68, 783 of 1971, 784 of 1968 and 785 of 1968 raise a simple but an interesting question namely, whether for the supplies of rice made by the appellants in January and February, 1964, they are to be paid price according to the rate specified in the Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964 dated March 23, 1964 or according to the rate specified in the Rice (Andhra Pradesh) Price Control order as it stood in 1963. The question arises in the followingappellants are millers and carry on the business of paddy and rice in the State of Andhra Pradesh. On July 31, 1959, the Governor of Andhra Pradesh in exercise of the powers conferred on him by section 3 ofthe Essential Commodities Act, 1955 (Central Act X of 1955) hereinafter referred to as `the Act made an order called the Andhra Pradesh Rice Procurement (Levy) order, 1959 clause 3   of the order required every dealer and every miller to sell to the State Government on requisition served on him by the requisitioning authority at the controlled price (a) 40 percent of the quantity of rice held in stock by him at the commencement of the order and (b) 40 percent of the total quantity of rice purchased b y him every day beginning with the commencement of the order. Clause 2(a) of the order defined "controlled price" as meaning the maximum price fixed under section 3 of the Act for the sale of rice by the Central Government from time to time (emphasis supplied). On December 19, 1963, the Central Government in exercise of the power conferred on it by section 3 of the Act made an order called the Rice (Andhra Pradesh) Price Control order, 1963, which extended to the districts of Krishna, West Godavari, East Godavari, Guntur, Nizamabad, Warangal and Nellore in the State of Andhra Pradesh. Clause (2) of the order provided that the maximum prices at which the varieties of rice specified in column (1) of the Schedule to that order were to be sold in wholesale quantities would be as specified in the corresponding entries in column (2) of the said Schedule. The said Schedule inter alia provided that Akkulu rice would be sold at Rs. 46.89 per quintal. In compliance with the requisitions served on them by the requisitioning authority of the State of Andhra Pradesh, the appellants sold various quantities of that variety of rice to the Government of that State from January 26, 1964, to February 21, 1964, and were paid at the aforesaid rate of Rs. 46.89 per quintal. By means of the Rice (Andhra Pradesh) Price Control (Second Amendment) order, 1964, dated March 20, 1964, the Central Government amended sub clause (1) of clause 2 of the Rice (Andhra Pradesh) P rice Control order, 1963 and ordained that in the said sub-clause for the words "the Schedule, the words and figures schedule I shall be substituted on March 23, 1964, the Central Government issued the Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964.Clause 2 of the order ran thus:-2. In the Rice (Andhra Pradesh) Price Control order, 1963, in Schedule I, for the varieties of rice and the maximum prices thereafter, the following shall b e substitutedor rice maximumPriceper quintal.1. Districts other than Nellore.. .. .. ..Akulu .. .. .. 52-25.. .. ..the issue of this order, the appellants made representations to the Government of Andhra Pradesh requesting that for the aforesaid supplies of Akkulu rice made by them from January 26 to February 21, 1964, they should also be paid at the enhanced price of Rs. 52.25 per quintal. As the representations made by them did not evoke a favourable response, they filed suits in the Court of the Subordinate Judge, Machilipatnam for recovery of the difference between the controlled prices specified in the Rice (Andhra Pradesh) Price Control order, 1963, dated December 19, 1963 and Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964. The suits filed by them were decreed by that Court. Aggrieved by these judgments and decrees the State of Andhra Pradesh preferred appeals to the High Court at Hyderabad which were allowed on the ground that is the supplies of rice were made by the appellants before the Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964, they were entitled only to the price specified in the Schedule to the Rice (Andhra Pradesh) Price Control order, 1963. Dissatisfied with these judgments and decrees, the appellants applied for certificate under Article 133(1) (a) of the Constitution which was granted to them.

Court's reasoning:
We cannot accede to this contention. It is no doubt true that the literal meaning of the word "substitute" is "to replace but the question before us is from which date the substitution or replacement of the new Schedule took effect. There is no deeming clause or some such provision in the Rice (Andhra Pradesh) Price Control (Third Amendment) order, 1964 to indicate that it was intended to have a retrospective effect. It is a well recognized rule of interpretation that in the absence of express words or appropriate language from which retrospectivity, may be inferred, a notification takes effect from the date it is issued and not from any prior date. The principle is also well settled that statutes should not be construed so as to create new disability or obligations or impose new duties in respect of transactions which were complete at the time the Amending Act came intocontention of Mr. Nariman that the controlled prices fixed by the Central Government for sale of rice are seasonal prices not being based upon any cogent material cannot also beHigh Court was, therefore, right in allowing the aforesaid appeals preferred by the respondent and reversing the judgment and decrees passed by the Subordinate Judge, Machilipatnam.