ORDER
1. In these petitions under Article 226 of the Constitution, the sole question for decision is, whether the Karnataka Automobile Tyres and Tubes (Control) Order, 1971, is ultra vires and void as contended for the petitioners.
2. The said order was made by the State Government in exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955 (Central Act 10 of 1955) (hereinafter called ‘the Act’), read with S. O. No. 1844, dated the 18th of June, 1966 issued by the Government of India. It was made on 13th December, 1971, and published in the Karnataka Gazette dated 14th of December, 1971. It extends to the whole of the State of Karnataka. It provides, among others, for regulating the sale of tyres and tubes of all varieties, issuing of licence and prosecution for contravening the conditions of the licence.
3. The petitioners are dealers in tyres and tubes. Their common contention is that the State Government have had no power validly delegated by the Central Government under Section 5 of the Act, to provide for the matters in relation to the automobile tyres and tubes.
4. In order to examine the contention, it is necessary to have a close look at the relevant provisions of the Act. The Act was intended to provide in the interest of the general public, power to control production, supply and distribution of, and trade and commerce in certain commodities. “Essential commodity” was defined under Section 2(a), as inclusive of various articles, like cattle fodder, coal, component parts and accessories of automobiles, cotton and woollen textiles, etc. By Section 2(a)(xi) authority was conferred upon the Central Government to declare by notification, any other commodity as an essential commodity for the purposes of the Act; that is, in addition to the commodities already defined under the Act. By Section 3(1), authority was conferred upon the Central Government so far as it appeared to be necessary or expedient for maintaining or increasing supplies of any essential commodity or securing their equitable distribution and availability at fair prices, to provide for regulating or prohibiting the production, supply and distribution thereof, and trade and commerce. It may be relevant to state that these powers are in the nature of delegated legislative powers. Section 4 provides that an order made under Section 3 may confer powers and impose duties upon the Central Government or the State Government or their officers or authorities and may contain directions as to the exercise of any such cowers or the discharge of any such duties. Section 5 provides for delegation of powers, It reads:
“5. Delegation of Powers:– The Central Government may, by notified order direct that “the power to make orders or issue notifications under Section 3” shall, in relation to such matters and subject to such conditions, if any, as may be specified, in the direction, be exercised also by
(a) such officer or authority subordinate to the Central Government, or
(b) such State Government or such Officer or authority subordinate to a State Government, as may be specified in the direction.”
On 18th June, 1966, the Central Government acting under Section 5, made an Order which reads as follows:
"GOVERNMENT OF INDIA, MINISTRY OF COMMERCE. ORDER : NEW DELHI, the 18th June, 1966. Delegation of Powers. S. O. No. 1844.-- In exercise of the powers conferred by Section 5 of the Essential Commodities Act, 1955 (10 of 1955) the Central Government hereby directs.......
(a) that the powers conferred on it by Sub-section (1) of Section 3 of the said Act to make orders to provide for the matters specified in Clauses (d), (e), (f), (g), (h), (i) and (ii) and (i) of subsection (2) thereof shall, in relation to all commodities other than foodstuffs and fertilisers (whether inorganic, organic, or mixed), be exercisable also by a State Government or, in relation to a Union territory, by the administrator thereof subject to the following conditions, namely–
(i) that the delegation of powers under Clause (d) shall not extend to inter-State transport or distribution and
the powers under that clause shall not be exercised so as to prejudicially affect such transport or distribution in pursuance of any order of the Central Government;
(ii) that all orders under Clause (f) shall require the prior concurrence of the Central Government;
(iii) that no order shall be issued in pursuance of the powers hereby delegated if it is inconsistent with any order issued by the Central Government under the said Act.” By the above order, the power has been delegated to the State Government to make orders under Section 3 of the Act to provide for the matters in relation to all commodities, other than foodstuffs end fertilisers. The State Government thinking that the power to make orders under Section 3, in relation to automobile tyres and tubes has been delegated to them, by the above order, have made the Karnataka Automobile Tyres and Tubes (Control) Order, 1971.
5. The validity of the above control order turns, therefore, on the question whether the Central Government have delegated their power to the State Government to make orders under Section 3, in relation to the essential commodity, namely, automobile tyres and tubes.
It is admitted that apart from the delegation made by S. O. 1844 dated 18th June, 1966, there was no other order by which the Central Government delegated their power to the State to make orders in relation to automobile tyres and tubes.
On 11th January, 1968, the Government of India made an order declaring “the tyres and tubes of Scooter”, to be an essential commodity for the purposes of the Act. On 22nd August. 1968, the Government of India made another order under Section 2(a)(xi) of the Act declaring “the tyres and tubes of cars and tractors” to be an essential commodity for the purposes of the Act. On 3rd January, 1969 the Central Government made a further order as follows:
“Government of India, Ministry of Commerce
Order: New Delhi, the 3rd January, 1969.
S. O. 85.– In exercise of the powers conferred by Sub-clause (xi) of Clause (a) of Section 2 of the Essential Commodities Act, 1955 (10 of 1955) the Central Government hereby directs that the following amendment shall be made in the order of the Government of India in the Ministry of Commerce, dated the 22nd August, 1968, namely:–
In the said order, for the entry “Tyres and Tubes of Cars and Tractors,
the following shall be substituted namely:-
Tyres and Tubes of Cars, Buses, Jeeps, Vans, Trucks, automobiles of any other category whatsoever. Tractors and tractor trollies.” It is thus seen that the tyres and tubes of scooters and that of automobiles were notified to be an essential commodity only on 11th January, 1968; and 22nd August, 1968 respectively. On 8th June 1966, when the Central Government directed that the powers conferred on it by Section 3 to make orders in relation to all commodities, be exercisable also by the State Government, the tyres and tubes of automobiles or of any other vehicle were not declared to be an essential commodity.
6. Before proceeding further, it is necessary to observe that the State did not contend, in my opinion, very rightly that the tyres and tubes are component parts and accessories of automobiles which are defined as essential commodity under Section 2(a)(iii) of the Act. But on behalf of the interveners, it was however contended that the tyres and tubes could be said to be accessories of automobiles. That contention cannot be accepted in view of the decision of the Supreme Court in State of Bihar v. Bhagirath Sharma, .
7. On behalf of the State, the Automobile Tyres and Tubes (Control) Order, 1971 was sought to be sustained solely on the basis of the power delegated by the Central Government by the Order S. O. 1844 dated 18th June, 1966-It was said that “all commodities” in the said order meant and included not only the commodities denned or declared to be essential commodities up to the date of the order, but also those that might be declared so, from time to time thereafter. The contention in other words, proceeded on the assumption that it is legally permissible for the Central Government to delegate their powers under Section 3, to the State Government or to other authority or Officer, to make orders in relation to a commodity even before it is declared to be an essential commodity. If this contention is correct, there may be little difficulty in sustaining the impugned order. But, it seems to me, that the legal position is otherwise.
8. Section 2(a)(xi) empowers the Central Government to declare by notification any other commodity as an essential commodity for the purposes of the Act. It is only when a commodity is declared by notified order as an essential commodity, the Central Government gets the power under Section 3, to control its production, supply and distribution. The order providing for regulating or prohibiting the production, supply or distribution of the essential commodity can be made if the Central Government is of the opinion that it is necessary or expedient so to do. This power of the Central Government could be delegated to the State in the manner provided by Section 5 of the Act, i.e. by a notified order, means by an order notified in the Official Gazette. The delegation may be subject to such conditions as may be specified by the Central Government. Before delegating the power, the Central Government have got to apply their mind whether it is necessary to delegate their power to the State Government, and if so, in relation to what matters, and subject to what conditions. If a commodity has not yet been declared to be an essential commodity, I fail to see how the Central Government could think of delegating their powers in the manner stated as above. Under the scheme of the Act, as I see it, the delegation can take place only in respect of an essential commodity either defined under the Act or which has been notified to be an essential commodity. There can’t be a delegation of power in reference to a commodity which is yet to be declared as an essential commodity.
9. There is one other reason why the contention for the State cannot be accepted. If a commodity has not been declared as an essential commodity, even the Central Government have no power to make orders under Section 3. If they themselves have no power on & particular date, the question of delegating their power on that day, does not arise. The delegator cannot delegate of what he himself does not possess. This principle would be clear if one remembers the concept of delegation. I may usefully extract herein below, the observation made by Mathew, J., in Gwalior Rayon Silk Mfg. (Wvg.) Co. v. The Assistant Commissioner of Sales Tax .
“Delegation is not the complete handing over or transference of a power from one person or body of persons to another. Delegation may be defined as the entrusting, by a person or body of persons, of the exercise of a power residing in that person or body of persons, to another person or body of persons, with complete power of revocation or amendment remaining in the grantor or delegator. It is important to grasp the implications of this, for, much confusion of thought has unfortunately resulted from assuming that delegation involves,
or may involve, the complete abdication or abrogation of a power. This is precluded by the definition. Delegation often involves the granting of discretionary authority to another, but such authority is purely derivative. The ultimate power always ‘remains in the delegator and is never renounced.”
It is therefore obvious that what could be delegated by a person or authority is of the exercise of a power residing in that person or authority. The Central Government when they made the order dated 18th June 1966, did not have the power to make orders under Section 3 in relation to the tyres and tubes of any vehicle, and therefore, the question of their delegating that power to the State Government did not arise.
The learned counsel for the State, however, relied upon the decision of the Supreme Court in Gwalior Rayon Silk Mfg. (Wvg.) Company’s case (supra) in support of his contention. In that case, the Supreme Court was considering the validity of Section 8(2)(b) of the Central Sales Tax Act, 1956 by which the Parliament adopted the rate of tax in the appropriate State for taxing the sales. The question was whether the said provision was bad for excessive delegation. The Supreme Court while upholding the validity of the Section, observed that the Parliament has not abdicated its legislative function and the Parliament by the said provision fixed the rate of tax on inter-State sales of the description specified in Section 8(2)(b) of the Act at the rate fixed by the appropriate State Legislature in respect of inter-State sales with a purpose namely, to check evasion of tax on inter-State sales and to prevent discrimination between residents in one State and those in other States. The decision, therefore, is of little assistance to the case of the State in these petitions. On the contrary the observation which I have extracted earlier clearly supports the case of the petitioners.
10. Even the plain language of the order dated 13th June 1966, cannot support the contention urged for the State. By the said order, the Central Government directed that the powers conferred upon them by Sub-section (1) of Section 3, to make orders in relation to all commodities be exercisable also by a State Government. It means the power which the Central Government possessed on the date of the said order, in relation to all essential commodities also to be exercised by a State Government. No other construction seems to be possible by the wordings of the said order.
Reference in this context may be made to the decision of the Supreme Court in Bagalkot City Municipality v. Bagalkot Cement Co., . The question arose in that case as to what exactly was the meaning of the Municipal District as provided by a by-law framed by the Bagalkot Municipality; whether it included also the area which subsequently came to be included as Municipal District after the framing of the By-law. The Supreme Court held that it could not. It was held that the by-law cannot refer to the Municipal District as from time to time existing. It could only mean that Municipal District as existing when the by-law was framed.
The observation of the Supreme Court in State of Maharashtra v. Madhavarao Damodar Patil, also lends support to the contention for the petitions. The question that arose in that case was whether the acts specified under the Ninth Schedule of the Constitution would also include the amendments to those acts from time to time made. Sikri, J. (as he then was) speaking for the Court observed:
“Now the question arises whether the impugned Act has been specified in the Ninth Schedule or not. It is true that what is mentioned in entry 34 of the Ninth Schedule is “The Maharashtra Agricultural Land (Ceiling on Holdings) Act, 1961 (Maharashtra Act XXVII of 1961)” which may be referred to as the Principal Act, and no mention is made j of the Amending Act, namely, Maharashtra Act XIII of 1962. Ordinarily if an Act is referred to by its title, it is intended to refer to that Act with all the amendments made in it up to the date of reference.”
By applying the similar rules of interpretation to the order dated 18th June, 1966, it could reasonably be stated that the Central Government intended to delegate their power under Section 3, in relation to all the essential commodities so defined or declared up to that day, excluding of course, the food-stuffs and fertilisers.
11. My view finds full support from a Bench decision of the Andhra Pradesh High Court in Konda Veer-anna Narasimhulu v. The State of Andhra Pradesh (W. P. No. 7413 of 1973 and connected petitions disposed on 27th December, 1973). In those cases, Andhra Pradesh Tyres and Tubes Dealers’ Licensing Order, 1973 was challenged. The said order was made by the State of Andhra Pradesh in exercise of the powers delegated to them by the
Central Government in their order dated 18th June, 1966. The order was similar to the one under consideration before me. The High Court of Andhra Pradesh held that the Central Government could not have delegated the power to make orders in relation to the tyres and tubes which came to be declared to be an essential commodity, subsequent to the order dated 18th June, 1966. Or) this reasoning, the High Court held that the Andhra Pradesh Tyres and Tubes Dealers’ Licensing Order, was invalid and ultra vires of the Act.
12. Before I part with the case, it is necessary to mention that the Central Government though a party to these petitions, have not taken any definite stand on the validity or otherwise of the impugned order. The Central Government Pleader submitted that he has no instructions in the matter.
13. In the result, and for the reasons stated above, the rule is made absolute; the Karnataka Automobile Tyres and Tubes (Control) Order, 1971 is declared to be void and ultra vires of the Essential Commodities Act, 1955. A writ in the nature of mandamus shall issue to the respondents to forbear from enforcing the provisions of the said Order against the petitioners.
14. The petitioners are entitled to their costs. Advocate’s fee Rs. 100/-one set.
15. Rule made absolute.