JUDGMENT
Wanchoo, C.J.
1. The following three questions have been referred to this Full Bench for answers:
“I. Whether the Essential Supplies (Temporary Powers) Act in so far as the State of Rajasthan is concerned should be regarded as an existing law within the meaning of Article 366(10), Constitution of India, solely on the ground that it was in force in some other parts of the Indian Union at the time the Constitution came into force in spite of the fact that it was then not in force in Rajasthan and it was so extended by an amendment Act of 1950?
2. Whether the term “Legislature of a State” in Article 31(3), Constitution of India should be taken to include within its meaning the Government of a State or some other authority while making rules, regulations, or orders under authority given to it under a Central Act of the Parliament?
3. Whether Section 6 of the Monopoly Procurement Order in so far as it provides for acquisition of property should be regarded as ultra vires of the provisions of the Essential Supplies (Temporary Powers) Act of 1946?”
2. We may give certain preliminary facts of the cases in which this reference has been made on these three points to this Full Bench. A number of dealers in foodgrains made applications under Article 226 of the Constitution and challenged the validity of certain orders passed under the” Rajasthan Foodgrains (Rabi) Monopoly procurement Order, 1952, (which shall hereinafter be referred to as ‘the Order’).
This Order was passed under the Essential Supplies (Temporary Powers) Act of 1946 (which shall hereinafter be referred to as ‘the Act’), as applied to Rajasthan by Amendment Act No. III of 1950, and by Notification S. R. O. No. 391, dated 17-8-1950, by the Government of India under Sub-section (2) of Section 1 of the Amendment Act No. III of 1950, and under powers delegated to the State Governments under Section 3 of the Act. Clause 6 of the Order gave power to Government to direct any dealer, carrying on business in food-grains in a ‘Mandi’ to which the Order applied, to deliver 60 per cent, in weight of the foodgrains purchased by him to the Collector of the district or to any person authorised by him in that behalf, and until such delivery was made to hold the same on behalf of the Government. Clause 7 of the Order provided for payment of the price of food-grains delivered under Clause 6 at such rates as, from time to time, were fixed by the Government by a notification published in the gazette.
3. The applicants were dealers in certain Mandis, and were ordered on 7-6-1952, to deliver 60 per cent, of the foodgrains purchased by them under Clause 6. The applicants contended that the Order in question was void and ultra vires, and in particular Clauses 6 and 7, for various reasons. The applications were opposed on behalf of the State, and came up for hearing before a Division Bench of this Court, and thereupon the three points mentioned above were referred to a Full Bench for decision.
4. We shall first consider whether the Act as applied to Rajasthan by the Amending Act No. III of 1950 was an existing law. “Existing law” is
defined in Article 366(10) of the Constitution as follows:
” “existing law” means any law, ordinance, order, bye-law, rule or regulation passed or made before the commencement of this Constitution by any Legislative authority or persons having power to make such a law, Ordinance, order, bye-law, rule or regulation.”
5. Learned Advocate-General contends that as the Act was a law made by a legislature having power to make it, it must be held to be an ‘existing law’ on the plain meaning of the words used in Article 366(10). There is no doubt that the Act was made by a legislature, namely the Indian Legislature as it was in 1946, and that legislature had authority to make that law for territories which were then known as British India. But this, in our opinion, does not conclude the matter, and we have to probe deeper to find out the meaning of Article 366(10).
Mr. Bhandari on behalf of the petitioners contends that the mere fact that a certain law had been passed by a certain legislature, and was in force in some parts of India before the commencement of the Constitution is not enough to make such law an ‘existing law’ for purposes of the entire territory of the Union of India. He contends further that in order to decide whether a particular law is existing law, the territory where it was in force or where it could be enforced, though it might not have been actually in force, has also to be kept in mind. Even if the law was in existence and could be enforced in a part of the territory which, on the commencement of the Constitution, became the Union of India, it could not be considered existing law for other parts of the territory where it could not possibly be enforced before the commencement of the Constitution. We are of opinion that there is force in Mr. Bhandari’s contention, and though Article 366(10) does not contain any direct reference to any territory, the idea of territory has to be imported in it in view of the words ‘having power to make such a law etc.’ appearing therein.
Only that law can be existing law which was made before, the commencement of the Constitution by any legislature etc. having power to make such law etc. Now any legislature or authority has power to make law etc. with reference to a particular territory, and the law passed by such legislature or authority would only be existing law for the territory for which the legislature etc. has the power to make such law. If a particular legislature had no power to make law for a particular territory, the fact that some law had been passed by some other legislature for some other territory would not make it existing law for the territory for which it was not and could not have been passed. A simple example will make our meaning clear. Take the legislature of the former Province of Bombay. That legislature had authority to make law for the territory comprised in the former province of Bombay, but had no authority to make law for the territory comprised, for example, in the former Province of Madras.
Suppose that some law was passed by the legislature of the former Bombay Province, which was in force before the commencement of the Constitution. That law would certainly be existing law for the territory of the former Bombay Province to which it applied, but it could not possibly be called existing law for the territory of the former Province of Madras, for the Bombay legislature would not be the legislature having power to make law for the former Province of Madras.
We do not see any difficulty in so construing “existing law” i.e. a particular law may he existing law for a particular part of the Union of India and may not be existing law for another part of the Union.
6. Learned Advocate-General drew our attention to Article 372 which provides for continuance in force of laws. Explanation 1 to Clause (3) of Article 372 provides that the expression “law to force” in this article shall include a law passed or made by a legislature or other competent authority in the territory of India before the commencement of this Constitution, and not previously repealed, notwithstanding that it or parts of it may not be then in operation either at all or in particular areas. It is urged that this explanation shows that it is not necessary, in order that a law may be a law in force, that it should be in actual operation at all or in any particular area; provided it has been made by a legislature or other competent authority. This explanation, does not, however, in our opinion, mean that where the legislature, which passed the law, had no authority to pass it for a particular territory the-law would still be law in force for that territory.
What the explanation means is that where a legislature having authority to pass a law for a particular territory passes such law, but leaves the date of its actual coming into force in any area to notification to be issued by the Government of that area, it would be deemed to be law in force for such territory within the meaning of Article 372, even though it may not have been actually brought into force before the commencement of the Constitution. If the legislature has authority to pass a law only for a particular territory and not for another territory, the law could only be called law in force for the territory for which it was passed and not the territory in which it could not be enforced at all. Explanation 1, therefore, shows that a law, which is enforceable in a particular territory, but which was not actually enforced before the commencement of the-Constitution, is to be treated as law in force for that territory; but if the law could not be enforced at all in a particular, territory, though it might be enforceable in some other territory, it could not be treated as law in force for the territory in which it could not be enforced at all.
7. The Act, with which we are dealing in this case, was passed in 1946 by the Indian legislature. At that time, the Indian legislature had no power to make law for the territory of Rajasthan. The Act, therefore, though it was in force in what was formerly British India, was not enforceable In Rajasthan at all. As a matter of fact, there was another existing law in Rajasthan dealing with the same subject, namely the Rajasthan Essential Supplies (Temporary Powers) Ordinance (No. 13) of 1949 for the State of Rajasthan. Therefore, this was the existing law dealing with the subject of essential supplies in Rajasthan. The. Amendment Act (No. 52) of 1950, which authorised the Central Government to enforce the Act of 1946 in Part B States, provided for repeal of the law existing in a part B State on the subject and thus when the Act was applied to Rajasthan on 17-8-1950, the Rajasthan Essential Supplies (Temporary Powers) Ordinance (No. 13) of 1949 stood repealed with respect to matters covered by the Act. It is clear therefore, that the Essential Supplies (Temporary Powers) Act of 1946 cannot be called an existing law within the meaning of Article 366(10) for the territory covered by the State of Rajasthan, and that the existing law on this subject in Rajasthan was Ordinance No. 13 of 1949
8. Our reply to the first question, therefore, is that the Essential Supplies (Temporary Powers) Act cannot be regarded as an existing law within the meaning of Article 366(10) so far as the state of Bajasthan is concerned.
9. We now come to the second question. Article 31(3) is in these terms :
“No such law as is referred to in Clause (2) made by the Legislature of a State shall have effect unless such law, having been reserved for the consideration of the President, has received his assent.”
What we are asked is whether the words “Legislature of a State” used in this clause include the Government of a State, or some other authority while making rules, regulations or orders under the authority given to it under a Central Act of the Parliament. The words, in our opinion, are clear, and the legislature of a State is what it is, namely the legislature, and cannot include Government or any other authority to which power is delegated to frame rules, regulations or orders under an Act of the Parliament. The words contemplate the legislature of a State as provided in Chapter III of Part 6 of the Constitution, or the authority which deputises for the legislature in Part B States under Article 385.
Shri Bhandari drew our attention to Article 12 which reads as follows :
“In this Part, unless the context otherwise requires, “the state” includes the Government and Parliament of India and the Government and the legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.”
The meaning of the words ‘the State’ in Article 12 has, in our opinion, no bearing on the meaning of the words ‘Legislature of a State’ appearing in Article 31(3). In the first place, the words ‘the State’ do not appear in Article 31(3). In the second place, the meaning assigned to the words ‘the State’ in Article 12 is qualified by the words ‘unless the context otherwise requires’. In the context of Article 31, it is obvious that Clause (3) refers only to the legislature as provided in Part 6, Chapter III or in Article 385 and to nothing else.
It was urged that if this interpretation were to be accepted, it may be possible for the legislature of a State to do away with the salutary check provided in Clause (3) of Article 31 by leaving it to the Government or other authority to provide for compensation for property taken possession of or acquired by rules. We do not think that there is any justification for this fear, for Article 31(2) provides that the law authorising the taking of possession or acquisition must provide for compensation and fix the amount of the compensation or specify the principles on which, and the manner in which, the compensation is to be determined and given. This provision must be in the law itself and obviously cannot be delegated to the rule-making body.
10. Our answer therefore to the second question is that the term ‘legislature of a State’ in Article 31(3) does not include within its meaning the Government of a State or some other authority while making rules, regulations or orders under authority given to it under a Central Act of the Parliament.
11. The third question, which we have to answer, is whether Section 6 of the Order, in so far as it provides for acquisition of property, is ultra vires of the provisions of the Act. In this connection, we may quote the relevant portions of Sections 3(1) and 3(2) of the Act:
“3(1) — The Central Government so far as it appears to it to be necessary or expedient for maintaining or increasing supplies, of any essential commodity, or securing their equitable distribution and availability at fair prices, may by order provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein.”
“3(2) Without prejudice to the generality of the powers conferred by Sub-section (1), an order made thereunder may provide ….
(f) for requiring any person holding stock, of an essential commodity to sell the whole or a specified part of the stock at such prices and to such persons or class of persons or in such circumstances as may be specified in the order.”
12. Shri Bhandari contends that Section 3 of the Act did not contemplate acquisition of foodgrains by Government, and therefore Clauses 6 and 7 of the Order, when they provide that the Collector may order a dealer to deliver sixty per cent in weight of the foodgrains purchased by him to the collector or to any person authorised by him, or to hold such grain for or on behalf of the Government and may pay such dealer at such rate as may be prescribed for the foodgrains, go beyond the rule making power conferred on the State Government. It is true that there is no specific provision for acquisition by the Government in Section 3. The explanation for that may be that in the Government of India Act, 1935, which was in force when the Act was made in 1946, there was only two items Nos. 27 and 29 in list II, Schedule 7 corresponding to items 26 and 27 of List II of Schedule 7 of the Constitution, and there was no item corresponding to item 36 of list II of Schedule 7 of the Constitution. Acquisition is specifically provided for now in item 36, but there was no such specific provision in any of the lists under the Government of India Act of 1935.
The powers however, which were given to the Central Government under Section 3 of the Act, are very wide and provide for regulating or prohibiting the production, supply and distribution of any essential commodity and trade and commerce therein. The purpose, for which these powers were given, was for securing equitable distribution and availability of essential commodities at fair prices. Section 3(2)(f) makes it clear that any person holding stock of an essential commodity could be ordered to sell the whole or a specified part of it at a fixed price to any other person. If, however, the Government thought that the best way of achieving the object of securing the equitable distribution and availability at fair price of an essential commodity was by purchasing it itself and then making it available to the members of the public through its own shops, we think it had the power to do so in view of the very wide words used in Section 3.
Such acquisition by Government would be covered by the words ‘regulating the supply and distribution’ found in Section 3. The illustrations given in Sub-section (2) of Section 3 are not exhaustive, and the amplitude of the powers conferred on the Central Government is to be found in the wide words used in Section 3(1). These words are, in our opinion, wide enough to include acquisition by Government of an essential commodity for the purposes of its equitable distribution and availability at fair price.
13. Our answer, therefore, to this question is that Clause 6 of the Order, in so far as it provides
for acquisition of property, is not ultra vires of the provisions of the Essential Supplies (Temporary Powers) Act of 1946. By this reply we should not be understood to say that the Essential Supplies (Temporary Powers) Act of 1946, as applied to Rajasthan on 17-8-1950 complies with the provisions of Article 31(2), in case such compliance is necessary.
14. Let these answers be returned to the Bench concerned.