ORDER
P. Rammakrishnan, J.
1. These three petitions for the issue of a writ of certiorari under Article 226 of the Constitution of India were heard together because the principal point arising for decision is common. The common question relates to the vires of provision in the rules framed under the Madras Preservation of Private Forests Act (Madras Act XXVII of 1949) (hereinafter referred to as the Act) for the levy of penalty for the contravention of a permit to cut trees in an area declared to be a forest under the aforesaid Act.
2. The facts of the case, W.P. No. 1489 of 1964 are typical of the other two cases and I shall refer to them in the first instance. The petitioner is a lessee of a private forest in the Gudalur taluk of the Nilgiris District and the forest was notified under Section 1(3) of the Act. He applied to the District Collector under Rule 5 of the rules framed under Section 10 of the Act for a permit to fell trees on an area of 50 acres for the purpose of raising a coffee plantation. He was given a permit for the purpose giving him a period of time of about one year, which was subsequently extended to the end of August, 1962, for the aforesaid purpose. But the petitioner found at the end of that period that he could plant coffee only on an extent of about 35 acres and in regard to the remaining extent, the nursery which he had raised had failed in part due to whether conditions and pests, and therefore for reasons beyond his control he could not plant coffee on the remaining 14 and odd acres. He was intimated by the Forest Range Officer, Gudalur in November, 1962 of the fact that he had not complied with the requirements of the permit, and he was asked to explain why he should not be prosecuted for non fulfilment of the conditions. The petitioner gave his explanation as to why he was not able to plant a part of the area with coffee. But thereafter without any prior notice to him, the Collector of the Nilgiris the respondent herein by his proceedings passed on 2nd July, 1964, directed that he should pay a penalty of Rs. 1,950 under Rule 14 of the rules framed under the Act for violating condition 4 of the permit issued to him.
3. In the case of the other petitioners permits were granted under similar circumstances and they were also not able to raise plantations over the full extent for similar causes and in their cases also the Collector of Nilgiris levied different amounts as penalties.
4. Aggrieved against the above orders levying penalties the petitioners have applied to this Court for the issue of a writ of certiorari under Art. 226 of the Constitution.
5. It is urged by the learned Counsel appearing for the petitioners that the penal provisions as stated in the Act are strictly limited to prosecution to be initiated in certain contingencies. Section 3(1) of the Act prohibits the owner of a private forest from alienating the whole or any part of it without the prior sanction of the District Collector. Section 3(2) prohibits the owner of a private forest from cutting trees or doing any act likely to denude the forest or diminish its utility without the previous permission of the District Collector. Section 3(2) prohibits the owner of a private forest from cutting trees or doing any act likely to denude the forest or diminish its utility without the previous permission of the District Collector. Section 7 of the Act provides that contravention of the provisions of sub Section (1) or Sub-section (2) of Section 3 or any of the terms of a notification under Section 6 (but with this we are not now concerned) will entail punishment of imprisonment up to two years or with fine upto Rs. 5,000 or with both. Section 8 requires prior sanction of the District Collector before the prosecution. Section 10 of the Act gives the State Government power to make rules for carrying out the purposes of the Act. Section 10(2)(b) gives such power to frame rules providing for the terms and conditions subject to which permits may be granted. It is pointed out that none of these provisions contained in the body of the Act proper makes provision for the levy of a penalty for contravening the conditions of a permit. Even the rule-making power governing the issue of permits conferred in Section 10(2)(b) does not embrace the power to levy a penalty. Against this background of the Act, we find however Rule 12 of the rules framed under the Act (corresponding to Rule 14 mentioned in the orders of the District Collector levying penalty) in the following terms:
If the District Collector has reason to believe that any person to whom permission for falling of trees under the Preservation of Private Forests Act, 1946 has been granted, has in his application furnished particulars which are materially incorrect or has contravened any provision of these rules or the conditions under which the permission was granted, the District Collector shall have power to cancel such permission immediately or modify the same subject to such penalty as he may deem fit to impose.
6. It is urged in support of the petitions that the power thus conferred on the District Collector to levy penalty gives him an arbitrary discretion without any limit as to the amount of the penalty, and this power is also conferred on the Collector by a rule framed by the State Government without the Act itself conferring on the Government power to frame such a rule, for the levy of penalty. It is urged by the learned Counsel that the power to levy penalties for the violation of a law or laws is a legislative and not a judicial or administration function. The authority quoted before me for this proposition is the observation found in Stouart and Bro., Inc. v. Bowles U.S.S.C.R. 88 Law Edn. 1350. 566.
7. Other enactments under the Indian law, which provide for levy of penalties are referred to in this connection to show how the Legislature in passing those other enactments, has borne this cardinal principle in view. Section 167(8) of the Sea Customs Act is an instance where the statute itself provides for the levy of penalty and also fixes its maximum. Section 53(3) of the Madras General Sales Tax Act empowers the State Government to frame a rule providing for the imposition of a fine and it limits the maximum up to which the fine can be levied. In a decision rendered by a Bench of this Court in State of Madras v. Shanmuga Oil Mills, Erode I.L.R. (1963) Mad. 12 : (1962) 75 L.W (considered the validity of) Section. 11(1) of the Madras Commercial Crops Markets Act, 1933 (as amended by Madras Act XXXIII of 1955) contained a provision which ran as follows:
Notwithstanding anything contained in the Madras General Sales Tax Act, 1939 (IX of 1939), the Market Committee shall, subject to such rules as may be made in this behalf, levy a cess by way of sales tax on any commercial crop bought and sold in the notified area at such rates as the State Government may, by notification, determine.
The question arose before the Bench for determination whether this provision in the statute itself giving unlimited power to the Marketing Committee to levy cess at such rates as the State Government may by notification determine was ultra vires. While striking down this provision as unconstitutional, the Bench observed as follows:
Some indication of a limit, or some principle with reference to which the executive should determine the rates, must be evident in a section of law delegating the power of taxation, before the delegation could be held constitutional. Otherwise, since…, the sky would be the only conceivable limit, and the executive might act in the exercise of an altogether unchannelled power and still claim legality, this should be interpreted as amounting to a virtual abdication of its function by the Legislature, and hence as unconstitutional.
The same principle will clearly apply to a provision such as is found in Rule 12 in these cases, for the levy of penalty by the District Collector without defining any limits for the levy of such a penalty. The position is made more acute, in the present case, by the fact that the statute itself is silent about the levy of penalty in such cases, and the rule-making power granted by Section 10 is also silent regarding the conferment on the State Government of a power to frame a rule for the levy of penalty.
8. One can contrast this state of affairs found in the Act, with a provision in the Madras Motor Vehicles Act. Section 63, wherein the statute itself provides for the contingency of a stage carriage granted to a bus operator being cancelled or suspended where there is a contravention of the conditions of the grant of the permit. But that statute gives an alternative whereby the transport authority instead of cancelling or suspending the permit as the case may be, can recover from the holder of the permit a sum of money agreed upon. This provision is often referred to as a provision for voluntary compounding, to avoid thereby the penalty of cancellation of a licence or permit. For that purpose, it will be open to the administrative authority, to name an arbitrary figure, giving the option to the permit-holder to accept that figure and compound, but if he finds the amount to be exhorbitant, he can refuse to compound, and then the authority granting the permit has got the discretion to cancel or suspend the permit. But in the present case the impugned Rule 12 does not purport to be an analogous provision giving the grantee of the permit an option to pay a composition fee, and in the alternative to face a situation where the permit itself would be cancelled or modified. It is an instance where the District Collector is given straightaway an arbitrary power to levy such sum as he likes by way of penalty for contravention of the conditions of the permit without any limit being fixed to it and without any option to the grantee to pay it or in the alternative face the consequence of the cancellation or modification of the permit.
9. In the aforesaid circumstances, in the instant case it appears to me that Rule 12 is ultra vires, because it gives an unfettered discretion to an administrative authority to impose penalty which is really a legislative power and not an administrative power. Secondly Rule 12 has been framed by the Government under the rule-making power under Section 10(1) in the absence of any power given under that section enabling the Government to frame such a rule. Thirdly the Act itself, which normally should contain the provision for penalties, viewed as a legislative power restricts itself to the situation visualised in Section 7 for the prosecution for certain contraventions, but does not contemplate the levy of penalty as a punishment for any other contravention.
10. In view of the above circumstances I allow these petitions and quash the orders of the District Collector levying penalty in these cases on the ground that Rule 12 under which the penalty was levied is ultra vires the Act. The petitioners will get costs in these petitions. There will be only one Advocate’s fee, Rs. 250 one set, to be paid in W.P. No. 1489 of 1964.