JUDGMENT
Bilal Nazki, J.
1.
These three Writ petitions raise same questions of fact and law. They are taken up for disposal together. The facts are narrated as stated in Writ petition No. 17422/99.
2. It is stated that certain assorted pieces of land in the districts of Khammam, East Godavari, West Godavari, Krishna, Guntur, Prakasam, Nellore and Warangal have rich black cotton soils and Virginia tobacco is being grown in all these districts for more than 70 years. The practice of growing Virginia tobacco was introduced by Britishers. It is further submitted that, earlier 85% of the Virginia tobacco grown in India was produced by Andhra Pradesh but with the development and encouragement for Virginia tobacco cultivation Karnataka is now one of the important tobacco producing States. In spite of that Andhra Pradesh is producing 70% of total production of tobacco of India. In 1975 Government of India felt a need of regulating the trade, growth and cultivation of Virginia tobacco and eventually Tobacco Board Act, 1975 (hereinafter referred as ‘the Act) was enacted. It came into force on 1st January,1976. The provisions contained in section 10 and 11 of the Act were made applicable to the State of Andhra Pradesh with effect from 28th August,1976. The provisions of section 12, 14 and 15 were also made applicable throughout the country with effect from 28th August,1976. Notifications for this purpose were issued. Tobacco Board was constituted under section 4 of the Act.
The grievance of the petitioners is two fold, one by which the classification of growers was made by dividing the black cotton soils in Andhra Pradesh into three regions. It is submitted that this classification has been made without any basis or data. Therefore the petitioners challenge the categorization of growers on the basis of regions. The second grievance is against the notification dated 14th June,1999 by which 5% service charge has been imposed on the unregistered growers. In order to appreciate the rival arguments it is necessary to have a glance through the Act.
3. The Act was promulgated by Parliament to provide for the development and regulation of the tobacco industry. Under section 4 Tobacco Board was constituted and Section 8 lays down the functions of the Board. Section 10 prohibits growing of Virginia tobacco without getting registered with the Tobacco Board. Section 13 prescribes the registered grower from selling or causing to be sold Virginia tobacco grown by him anywhere other than at an auction platform established or registered with the Tobacco Board. Breach of any of the provisions of the Act is punishable under section 25 of the Act. The provisions make it clear that Tobacco can be grown and sold only in accordance with the provisions of the Act and this can be grown and sold by growers who are registered with the Tobacco Board. Even after registration the grower cannot cultivate tobacco over an area which is in excess of authorized area. The tobacco grower who has grown tobacco without getting himself registered or who has grown tobacco over an area which is in excess of authorized area would be liable for punishment under section 25.
This is not the case of the petitioners that they were authorized to grow the tobacco for which 5% service charges have been imposed. They submit that, in terms of section 14A there is an embargo not to levy fee for the services rendered by the Board exceeding 2% of the value of the tobacco sold, therefore the respondents were not competent to levy service charge at the rate of 5%. It is penal and it is in the nature of the tax which could have not been levied.
4. Admittedly it is the unauthorized tobacco which is subject to 5% of levy under the notification of 14th June,1999. But the contention of the petitioners is that they became unauthorized growers with respect to certain quantities of tobacco because of the illegal classification made of the soils and even otherwise the respondents had no power or authority to levy 5% service charge as that would be contrary to section 14A of the Act. The classification of the soils has been challenged on the ground that this was arrived at without any basis or any data.
5. The respondents in their counter have denied that the classification into three regions was made without any scientific basis. It is stated that nowhere in the World except in India and South Africa tobacco is grown in black soils. The tobacco produced in black soils is unripe having imbalance leaf chemistry and has poor manufacturing qualities for cigarette making. Light soil tobacco will have desirable characters for cigarette making. Because of the poor quality, tobacco from black soils particularly in NBS/CBS regions the growth of tobacco is either declining or static in India. In climate i.e., rainfall , day and night temperatures and relative humidity play an important role on quality of tobacco. In Southern black soils the crop is planted in October and at least 2 to 3 rains are received during the crop growth. Therefore the leaf is some what ripe, open grained, good bodied and lemon to lemon orange in colour with pliability Humidity levels are also high in SBS areas since they are located nearer to the sea coast and in respect of NBS/CBS region, crop is planted in November/December and generally rains are not received during crop growth period under normal conditions. Because of moisture stress in the soil and higher day temperatures and its distance from the sea cost the leaf produced is unripe, thick bodied, lemon in colour without pliability. The rainfall data relating to Ongole (SBS region) and Guntur, Tadikonda, Kanchikacherla representing CBS regions and Rajahmundry and Bhadrachalam representing NBS region has been filed along with the counter. The cigarette manufacturers, according to the respondents, are of the opinion that tobacco grown in southern black soils is preferred to tobacco grown in CBS/NBS regions because of its advantages in both physical and chemical properties in cigarette making. The differences in three categories have also been given in the counter as below;
Character
SBS Tobacco’s
NBS/CBS Tobacco’s
1. Maturity
Ripe tobacco/matured
tobacco
Unripe/immature tobacco
2.Filling value
High filling value (800 gms of raw tobacco makes 1000 cigarettes
Low filling value (900 gms of raw tobacco makes 1000 cigarettes
3.Smoking
Less throat irritation while smoking
More throat irritation while smoking
4. Combustability
Good combustability
Poor combustability
5.Cutting losses
6. The losses are less while cutting tobacco into flakes
The losses are more while cutting tobacco into flakes
7. Copies of the letters addressed by cigarette manufacturers have also been annexed with the counter. The particulars of marketability of the leaf including the export in the regions have been furnished. It is further stated that, about 60 to 70% of tobacco was earlier being exported and the balance of 30 to 40% was used for domestic purpose, but of late domestic manufacturers are not preferring tobacco from this region because of its unsuitability. The export demand for this tobacco has declined rapidly. With the disintegration of Soviet Russia the export to Russia touched bottom levels. It is further stated that in 1992-93, 34 M. Kgs of tobacco was being purchased from Andhra Pradesh which came down to 15 M.Kgs in 1993-94. Although there was no market, yet the farmers registered in 1992-93 were granted registration even in 1993-94, but because of the fall in the demand less areas were authorized and less quota was indicated. The respondents have also given the factors which are responsible for the usage of tobacco, they are:
“(a) Chemistry of the leaf (b) filling value (c) aroma. All the factors vary from one soil region to another. The quantity of tobacco marketed in NBS/CBS regions compared to SBS region and the prices paid from 1993-94 to 1998-99 is filed herewith marked as R8. One of the functions of the Board is to regulate production of tobacco to the extent of demand so as to ensure a fair and remunerative price to the farmers for their produce. Therefore, based on the demand for tobacco assessed by the Board in each soil region the farmers are registered in an effort to regulate the production to the extent of demand as laid down under sec.8 of the Act. The flue cured tobacco soils of AP are broadly classified into five major tobacco growing zones based on (1) the Geographical locations and (2) soil type. They are, (a) Northern light soils (b) Southern light soils (Southern Red loams) (c) Southern black soils (d) Northern Black soils and (e) Central black soils. The physico chemical properties of these soils are furnished below:
Light soils: Northern Light soils (NLS) : These are sands, loamy sands and sandy loams, light in texture, acidic in soil reaction, poor in fertility and water retention capacity. Very low in exchangeable cations and have very good drainage. Tobacco is grown under irrigated conditions during winter. Geographically, NLS comprises parts of the east Godavari, West Godavari and Khammam districts.
Southern light soils (SLS) : These are light and medium textured red loams, neutral to alkaline in reaction with moderate fertility. Soil compaction or hardness of soil after rains is a serious soil management problem. Moderately well drained, moderate water holding capacity, moderate permeability and low to medium cation exchange capacity. Tobacco is grown during winter on the conserved soil moisture from N.E monsoon rains. The light soils existing in Nellore and Prakasam districts are grouped under SLS.
Black soils: The black soils are grouped in to the following categories on the basis of their geographical distribution. By the CTRI, Rajahmundry, which was published in the book “Package of practices for FCB tobacco in Andhra Pradesh. The details of the soils are given below:
Southern Black soils: These are medium textured silt loams, moderately alkaline in soil reaction with moderate water holding capacity. Tobacco is grown on the conserved soil moisture as a post monsoon crop during winter. The black soils existing in Prakasam and Nellore districts are grouped under SBS.
Central Black soils (CBS) : They are fine textured, heavy black cotton soils, with high clay content and high moisture retention capacity. The FCV tobacco crop is raised on the conserved soil moisture in this zone. These soils are low in organic matter but rich in calcium and potassium. The heavy black soils of Krishna and Guntur districts come under CBS.
Northern Black soils (NBS) : The fine textured black soils of East Godavari, West Godavari, Karimnagar, Warangal and parts of Khammam district come under this zone. They are characterized by high clay content, Ca, K and high water holding capacity. Rich in fertility, very poor drainage and calcarious in nature. Tobacco is raised as a dry crop on the conserved soil moisture.”
8. Considering all these factors, the respondents came to the conclusion that the soils need to be classified into three regions on the basis of their suitability, production and marketability. Therefore, it will not be correct to say that the classification has been made without any basis. It is true that under Article 14 of the Constitution of India this Court can strike out exercise of power made arbitrarily, but it is settled law that this Court would not be sitting as an appellate authority over the decisions taken by the Executive authorities. We do not find that the exercise of classification of soils has been done without any material. This has been done on various considerations, scientific inputs have been gone into in the decision making. As is pointed out, this Court is not sitting in appeal over the decision arrived, but even if we scrutinise the decision, we will be helpless because such a decision needs an expert opinion. Experts have gone into the question, they have taken all important factors into consideration and have come to a conclusion. This Court can only see whether the steps taken in arriving at a decision were arbitrary or not. We have not found any arbitrariness. The decision has been arrived while taking into consideration all the material factors. Therefore, the classification cannot be termed as arbitrary. Once the classification is upheld the petitioners, admittedly, are unauthorized growers as far as the tobacco grown beyond the permitted limits. We have noticed hereinabove the scheme of the Act. Even if a registered grower unauthorisedly grows tobacco beyond the limit prescribed he commits an offence under the provisions of the Act, therefore, section 14A of the Act will not be of any help to the unauthorized growers. This has already been upheld by the Supreme Court in The Tobacco Board Vs. P.S. Sengaraj Urs (unreported judgment in Civil Appeal No. 2464/98, dated 28th April,1998).Going by the judgment of the Supreme Court and the scheme of the Act, we feel that the impugned notification does not suffer from any illegality.
9. For these reasons, the Writ petitions are dismissed. No costs.