Partly allowed

M/s Jagadamba Agro Tech v. The State of Telangana

Telangana HC13 Dec 2021WP/1111/2021

Case brief

AI extract

What is this about?

The Telangana High Court set aside a writ petition challenging a rice mill's blacklisting by civil supplies authorities for five years. The court held that the blacklisting action violated natural justice principles as the petitioner was not issued a notice or given an opportunity to explain before the penalty was imposed.

What did the court decide?

Impugned order of blacklisting for five years set aside; matter remanded to respondents to issue notice to petitioner and pass orders thereafter.

M/s Jagadamba Agro Tech Vs The State of Telangana — Property and Title | Telangana HC (2021)

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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD

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(Special Original Jurisdiction)

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MONDAY ,THE THIRTEENTH DAY OF DECEN/BER TWO THOUSAND AND TWENTY ONE

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PRESENT

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THE HONOURABLE SRI JUSTICE T.VINOD KUMAR

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WRIT PETITION NO: 1111 OF 2021

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Between:

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M/s Jaga{amba Agro Tech, Anathapur Village Shivar, Gadwal, Rep by its Managing Partner T. Shekhar Reddy, Sio T. Gal Reddy.

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...'ET'T,ONER

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AND

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The State of Telangana, Represented by its Principal Secretary, Consumer affairs, Food and Civil Supplies Secretariat Buildings, Hyderabbd.

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The Joint Collector, Jogulamba Gadwal District, Gadwai.

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Telangana State Civil Supplies Corporation Ltd, (TSCSCL), Erramanzil, Hydetabad Rep by its Vice Chairman and Managing Direcior.

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The Districtlvlana!e! Telang_ana State Civit Sup-plids Corporation Ltd (TSCSCL), Jogulamba Gadwal District, Gadwal.

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...RESPONDENTS

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Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High court may be pleased to issue an appropriate writ, order or direction more particularly one in the nature writ of Mandamus, declaring the impugned orders in case No.cs6/2712019 ol lhe 2nd respondent in so far as blacklisting the petitioner rice mill for supply of CIVR paddy for a period of five years without appreciating the track record of the petitioner in milling the paddy into rice and supplying in time in preceding years, as illegal, arbitrary and violation of Article 14,19(1Xg) of and consequenfly set aside the same.

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lA NO: 1 OF 2021

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Petition under Sectron 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may be pleased to direct the respondents to allot the CNIR Paddy to the petitioner rice mill for the Kharif Season 2020- 21 (1430 Fasli) by suspending the operation of the impugned orders of the 2nd respondent in Case No.CS6/27120i9.

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Counsel for the Petitioner : SRI K. RATHANGA PANI REDDY Counsel for the Respondent Nos.1 & 2: Gp FOR CIVIL SUppLIES Counsel for the Respondent Nos.3 & 4: SRI T.p. ACHARI, SC FOR TSCSCL

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The Court made the following: ORDER

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HONC URABLE SRI JUSTICE^{T,VINOD KT]M,\R}

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w PETITI ON No.ll 1l^of2021

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ORDER:

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In this W it Petition,^{the petitioner is assailing the correctnessof} the order^pass 'd by^{the 2nd respondentin proceedings in Case} No.CS6/27l20 lg^{dt.31-12-2020blacklisting the petitioner Rice Mill for} supply of CMR 1^{addy fora period of 5 years'}

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Heard lear red^{counselfor petitioner,leamedGovemmentfor Civil} Supplies^{appear ng for respondentNos'land 2 and Sri T'PAchari'} learned Standing^{Counsel appearing for 3 and 4'}

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Counter af idavit^{on behalfof2nd respondent is filed'}

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4.Theshort<uestioninvolvedinthepresentWritPetitionisastothe correctness of^{he impugnedorder passed by 2no respondentin} blacklisting^{the p:titioner for a period of 5 yearsinasmuch as no notice} was issued by^{rer pondentsbefore imposingthe saidpenal action on the} petitioner.

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Petitioner^{( cntends that though variousproceedingsunder Section} 6-4 of the^{Essenial Commodities Act, 1955 (for short.the Act,) were} pendingbeforeth:Authority,sincetheorderofblacklistingisassociated with civil^{conseqlences depriving petitioner of its relatior.rship with the} Govemment^{for -he pulposeof conductingbusiness'the respondents} ought to^{have pr t the petitioneron noticebefore irnposing the penal} actiorroCblacklist^{ng for a periodol 5 yearsis initiated'}

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Leamed^{Govemment preader for civil Supplies seeks to support} the order^{and submitson l7 -07 -2020' about1 5'000 CMRpaddy bags and} 40^{quintals of CMR rice were seizedfrom the Mill premisesof the} petitioner^{and similarry on the same day,z70 quintals of rice were found} on the^{platform of 3'd respondent Corporation belonging to the petitioner'} rn respect^{of the said seizure effected,the respondentshave initiated} necessary^{action underSection 6-4 and 6-8 of the Act and the} proceedings^are Pending'

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It^{is further contended that against above seizure'the petitioner} obtained^{release by approaching this Courtin W'P'Nos'11674of 2020} and 12731^of2020.

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Leamed Govemment^{Pleader for Revenue would further submit} that having^{regard to the fact that petitioner is indulging in illegal} practices and^{violatingthe termsof agreement entered into for supplying} CMR rice from^{and out of the CMR paddy suppliedto it, respondents} have initiated action of^{blacklisting.}

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Leamed Government^{Pleader for Revenue would fuither submit} that in terms^qf Clause 1 1 of G.O.Ms.No.17 Consumer^{Affairs,Foodand} Civil Supplies (C.S.l.C.C.S.) Departrnent dt.27-09-2019,,^the 2nd respondent is empowered to blacklist the rice miller who has diverted paddy stocks delivered for custom milling and indulged in purchase of PDS rice and attempt to deliver the same under CMR in exercise of powers conferred thereunder. Thus it is contended that the impugned order passed does not call for any interference.

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..1.,

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I0. I have take r note of the respective contentions.

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l1' It is settleo position of law that brackristing rhe trader or a person has a civil conse, ruence and is of punitive nature, and therefore before such action is init ated, the concemed person/dealer is required to put on notice. Admitted. y, in the facts of the present case, no notice has been issued by respon( ents in particular 2nd respondent before resorting to blacklisting of thr petitioner even though there are other proceedings which are said to be pending under Section 6_.4 of the Act. Since petitioner has not L:en put on notice enabling it to offer its explanation as to why the penaltl of blacklisting and that too being for a period of 5 years should not I e imposed on it, this Court is of the view that the impugned order pr ssed by respondents is in violation of principles of natural .justice.

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Fufiher, the Ionourable Supreme Court in Erusian Equipment &

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Chemicals Ltd vs itate Of West Bengal & Anotherr observed^:

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"Black i sting has the effect of preventing a person from the privilege and advantage ofentering into lawful relationship^with the Gov<'nmentfor^{purposesof gains.The} fact^{that a disability} is create I by the order of blacklisting^{indicatesthat the relevant} authorit. is to have an obiectitte satisfaction.^{Fundamentalsof} fair^{plq require thatthe personconcerned shouldbe given an} oppottut ily to represent^{his ca'sebeJbre he is pltl on the} blacklist^"

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The said vir w of the Supreme^{Coufi has been followedby this}

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Courl in P.Ravicl randra^{Reddy Vs. Executive Engineer,lrrigation}

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and CAD Develol ment,^{Nalgonda District SouthDivision'Gudu12'}

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'^{AtR 1975sc 266} 'zoos iri^{alo e:}

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::4::

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ln^{view of the settledposition of law as elucidated above'the} impugned^{action of the respondentsin blacklisting the petitionerfora} period of 5^{yearswithout even puttingon notice of the chargeor allowing} thepetitionertoofferhisexplanationandconsiderationthereofhas caused serious^{prejudice to the petitioner'}

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In view of^{the same, the impugned order to the extentof} blacklisting the^{petitionerfor a period of 5 years is liable to be interfered} with. Consequently,^{the impugned order dt.31-12-2020to the extent as} indicated above is set aside^{and the matteris remandedback to the} respondents to initiate^{proceedings afresh,if the said Authorityso desires,} by issuing notice to the^petitioner to^{enable the petitionerto offer its} explanation and consider the same in accordance^with law and^thereafter pass orders thereon and communicate it to the petitioner.

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Accordingly, the Writ Petition is partly allowed as indicated above No costs.

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Consequently, miscellaneous petitions, pending if any, shall stand closed.

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SD/.K.ONESIM ASSISTAN BEGISTRAR ,TRUE COPY/I AII SECTION OFFICER

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To, 1 The Principal Secretary, Consumer affairs,^{Foodand CivilSupplies, Stateof} Telangana, Secretariat Buildings, Hyderabad. The Joint Collector, Jogulamba Gadwal District,^Gadwal.

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