JUDGMENT
S. Sarwar Ali, Ag. C.J.
1. The petitioners are dealers in foodgrains. They hold licenses under the Bihar Foodgrains Dealers Licensing Order, 1967. They have imported rice/paddy from outside the State. The levy payable under the local law of the exporting Stale has been paid on the imported foodgrains. They are now required to pay levy in accordance with the law of this State, being Bihar Rice and Paddy Procurement Second Order, 1981. Their claim is that the State is prevented from realising the levy on the principle of promissory estoppel. This is the main contention raised in these two writ applications. Some other contentions have also been raised.
2. As is well known, in order to maintain the supply of rice and securing its equitable distribution and availability at fair price, paddy/rice has to be procured by the State. The procurement orders have been issued from time to time. The latest order, with which we are concerned, is called Bihar Rice and Paddy Procurement Second Order, 1981 (hereinafter referred to as the Procurement Order). It requires rice millers and wholesale dealers to sell to the State Government or its agent paddy/rice in accordance with the provisions of Clauses 3 and 4 of the Procurement Order, The quantity of levy for licensed miller has been fixed per licensed huller/sheller. As an alternative they may elect to sell on production or manufacture basis. The wholesalers, on the other hand have to sell on the basis of stock held on the commencement of the Procurement Order, and future purchases. As an alternative they may elect to compound. It is a fixed quantity of rice, namely, 1000 quintals. Admittedly, neither of these two petitioners has gone in for compounding. Thus if levy is payable, it is on the basis of their stock and purchases.
3. I may now state the basic facts, on the basis of which the principles of promissory estoppel are sought to be availed of. They are contained in the supplementary affidavits to C.W.J.C. No. 499 of 1982.
4. It is stated that the Council of Ministers of the State of Bihar in its meeting dated 3-12-1981 took a decision that no levy shall be charged on rice and paddy which is imported from other States. This was published in the daily newspaper, Searchlight, on 8-12-1981, as well as in Hindi daily newspaper, Pradeep. On 7-12-1981 Sri Lahtan Chau-dhary, Minister-in-charge of Food and Supply Department called a meeting in which the Food Commissioner and Chair-man of the Food and Supply Corporation and other officers were present. In the meeting he stated that the Government of Bihar had removed levy on the rice imported from other States. It is claimed that the Minister stated to the following effect:–
“The State Government has removed levy from the imported rice. This decision has been taken in the recent meeting of the Council of Ministers. Taking into consideration the prospect of Kharif season the State Government has taken the decision in order to encourage the traders to import rice from outside. Because of this there would be a fall in the price of rice in the open market.” (See paragraph 3 of the Second Suppl. affdvt.) The aforesaid statement of the Minister was reported in the local daily newspapers “Searchlight” and “Pradeep”. Thereafter a meeting was called by the Ministers in the premises of the Bihar Chamber of Commerce wherein in course of the speech the Minister is said to have made certain promises. It is claimed that the speech of the Minister was tape recorded. Learned counsel for the petitioners stated before us that the tape was available. We, therefore, thought it proper that we should get the relevant portion of the speech transcribed and then it would be possible to know the actual words used. The relevant portion of the speech in Hindi is as follows;–
^^ysoh dh ckr vkius dgh gS] ,slk
fu.kZ; fy;k tSlk fd dgk vkidks v/;{k egksn; us fd tks ckgj ls lkeku yk;ssaxs]
ysoh nsdj] igys ,slk fu.kZ; ugha Fkk A igys tsujy vkMj Fkk fd tks lkeku tSls
pkoy ;k /kku yk;saxs mlij ge ysoh ysxs] ysfdu geus bldks mfpr le>k fd vxj
ckgj es dksbZ lkeku ykrk gS vkSj ykdj gekjs ;gk¡ csprk gS rks mlus ysoh ns nh
gS pwafd mlls vxj ysoh ysaxs rks ;k rks og ykuk can dj nsxk ;k mldh ijs’kkuh
c<+ tk;sxh A blfy, vius ;g fu.kZ; fy;k vkSj lkjh txgksa ij bldh lwpuk tk pqdh
gS A eSa vkidks cryk nsuk pkgrk gwa fd tks yksx ysoh nsds yk;s gS muls fQj ysoh
ugha yh tk;sxh ysfdu ,d ckr ge crk nsuk pkgrs gS fd tks lkeku os yk;saxs ysoh
nsdj] mudk fMliksty os tYnh ls tYnh dj nssa A**
5. It is thus contended that A promise was held out to the petitioners and all other dealers in foodgrains that if they import rice in this State, after paying levy in the exporting State and dispose of the imported rice without any delay, they shall not be liable to levy under the local law, namely, the Procurement Order. The petitioners, it is contended had imported rice on the basis of the promise aforesaid. Had the said promise been not made they would have not imported the rice and thus subjected themselves to levy which would result in loss to them. It would be commercially unsound to import rice from neighbouring States if the levy is to be paid in this State. In this situation the principles of promissory estoppel, it was urged, were squarely applicable.
6. Counter-affidavits have been filed on behalf of the State, in which the factual assertions, as mentioned above, have not been denied. But what has been asserted is that–
(a) No notification or executive instruction was issued after 3-12-1981 allowing exemption on the imported rice. Thus the tentative decision taken by the Council of Ministers in the meeting held on 3-12-1981 was not finalised so as to constitute a decision by the Government binding on the State.
(b) A statement made by a Minister does not amount to a statement by a person or authority authorised to make a binding statement or promise on behalf of the State;
(c) There was no promise on behalf of the State that if any rice is imported it would be exempted from levy under the Procurement Order. In any event, it was not on the basis of any inducement or promise held out by the State that the rice had been imported by the petitioners or others similarly situated; and
(d) That any statement made in relation to a past act cannot form basis for a plea for promissory estoppel.
7. Learned counsel for the parties referred to three decisions of the Supreme Court, namely, Motilal Padampat Sugar Mills Co. Ltd. v. State of U. P. (AIR 1979 SC 621); Bhim Singh v. State of Haryana (AIR 1980 SC 768); and M/s. Jit Ram Shiv Kumar v. State of Haryana (AIR 1980 SC 1285).
8. It appears to me, and I say this with great respect, that two trend of thoughts are disclosed in these decisions. The ratio of the decision in Jit Ram Shiv Kumar’s case (AIR 1980 SC 1285 at p. 1302) (supra) may be stated in the words of Kailasam, J.:–
“The scope of the plea of doctrine of promissory estoppel against the Government may be summed up as follows:–
(1) The plea of promissory estoppel is not available against the exercise of the legislative functions of the State.
(2) The doctrine cannot be invoked for preventing the Government from discharging its functions under the law.
(3) When the officer of the Government acts outside the scope of his authority, the plea of promissory estoppel is not available. The doctrine of ultra vires will come into operation and the Government cannot be held bound by the authorised acts of its officers.
(4) When the officer acts within the scope of his authority under a scheme and enters into an agreement and makes a representation and a person acting on that representation puts himself in a disadvantageous position, the Court is entitled to require the officer to act according to the scheme and the agreement or representation. The officer cannot arbitrarily act on his mere whim and ignore his promise on some undefined and undisclosed grounds of necessity or change the conditions to the prejudice of the person who had acted upon such representation and put himself in a disadvantageous position.
(5) The officer would be justified in changing the terms of the agreement to the prejudice of the other party on special considerations such as difficult foreign exchange position or other matters which have a bearing on general interest of the State.” The other trend of thought is revealed in the decision in Motilal Padampat Sugar Mills’ case (supra). Learned counsel for the petitioners contended that the decision in this case has the approval of three Judges Bench in Bhim Singh’s case (supra). For the purpose of this case, I propose to examine the decision most favourable to the petitioners, and then find out whether on the principles therein enunciated, the petitioners can claim successfully to have established the necessary requirement for the applicability of the principles of promissory estoppel.
9. In Motilal Padampat Sugar Mills’s case (AIR 1979 SC 621), Bhag-wati, J. stated the principle of promissory estoppel thus:–
“The true principle of promissory estoppel, therefore, seems to be that where one party has by his words or conduct made to the other a clear and unequivocal promise which is intended to create legal relations or affect a legal relationship to arise in the future knowing or intending that it would be acted upon by the other party to whom the promise is made and it is in fact so acted upon by the other party, the promise would be binding on the party making it and he would not be entitled to go back upon it, if it would be inequitable to allow him to do so having regard to the dealings which have taken place between the parties, and this would be so irrespective whether there is any preexisting relationship between the parties or not,”
Later in paragraph 24 of the judgment it was stated–
“The law may, therefore, now be taken to be settled as a result of this decision, that where the Government makes a promise knowing or intending that it would be acted on by the promisee and, in fact, the promisee, acting in reliance on it, alters his position, the Govt. would be held bound by the promise and the promise would be enforceable against the Govt. at the instance of the promisee, notwithstanding that there is no consideration for the promise and the promise is not recorded in the form of a formal contract as required by Article 299 of the Constitution.”
10. Learned Government Pleader No. 1, on behalf of the State, contended thai in the instant case no promise was made by the Government. He contended that the statements relied upon cannot be binding on the State unless they fulfil the requirement of Article 166 of the Constitution. He mainly relied on the decision of the Supreme Court in Bachhittar Singh v. State of Punjab (AIR 1963 SC 395). Shri Rajgarhiya appearing on behalf of the petitioners on the other hand relied on the decisions in Smt. Godavari Shamrao Parulekar v. State of Maharashtra (AIR 1964 SC 1128); Emperor v. Sibnath Banerji (AIR 1945 PC 156) and Haroobhai M. Mehta v. State of Gujarat (AIR 1967 Guj 229) and contended that the statement made by the Minister is binding on the Government as the rules of executive business make a Minister-in-charge of his Department.
11. Article 166 of the Constitution was follows: —
“Conduct of business of the Government of a State-(1) All executive action of the Government of a State shall be expressed to be taken in the name of the Governor.
(2) Orders and other instruments made and executed in the name of the Governor shall be authenticated in such manner as may be specified in rules to be made by the Governor, and the validity of an order or instrument which is so authenticated shall not be called in question on the ground that it is not an order or instrument made or executed by the Governor.
(3) The Governor shall make rules for the more convenient transaction of the business of the Government of the State, and for the allocation among Ministers of the said business in so far as it is not business with respect to which the Governor is by or under this Constitution required to act in his discretion.
No court or other authority shall be entitled to require the production of any rules made under Clause (3) for the more convenient transaction of the business of the Government of the State.” This Article has been considered in Bachhittar Singh’s case (supra) and it has been held that the Minister is no more than an advisor and that the Governor has to act with the aid and advice of his Council of Ministers. Until such advice is accepted by the Governor whatever the Ministers or the Council of Ministers may say in regard to a particular matter does not become the action of the State until the advice of the Council of Ministers is accepted or deemed to be accepted by the Governor. It was further observed that until an order or decision is communicated to the persons affected by it– “it will be open to the Council of Ministers to consider the matter over and over again, and therefore, till its communication, the order cannot be regarded as anything more than provisional in character”. In order, therefore, to make any decision or promise binding on the State, it has to be accepted or deemed to be accepted by the Governor and communicated by a person authorised to make such communication. The rules of executive business of this State, clearly lay down that a Secretary, Joint Secretary etc. can authenticate an order made by the Governor. Communication can only be under the signature of such persons. Minister is not one of them. I am, therefore, of the view that in the present case, the statements made by the Minister, either in the meeting or otherwise, cannot be said to be the statement of the State Government, so as to be binding on it. The statements, if any, made by the Minister cannot constitute promise made on behalf of the State Government. It would be pertinent now to refer to the facts of Motilal Padampat Mills’s case (AIR 1979 SC 621) (supra) to show. Therein an assurance was given by the Chief Secretary in a written communication dated 23-1-1969. The Chief Secretary undoubtedly was an authorised person who could make a promise on behalf of the State Government. Such is not the position here. The cases relied upon by the learned counsel for the petitioners are all distinguishable. They do not deal with situation of the nature under consideration in this case.
12. I now examine the contention raised on the assumption that the statement of a Minister binds the State Government. In this context it will have to be considered–
(1) Whether any clear and unequivocal promise was made; and
(2) Whether it will be inequitable to allow the State Government to go back on the alleged promise.
13. In so far as the statement by the Minister dated 7-12-1981 is concerned, we do not have the exact words used by him. The petitioner relies on the report in Searchlight and Pradeep. Those reports are the impression of the correspondent of the newspapers concerned. In order to determine whether the principles of promissory estoppel are applicable, we must know the exact words used which it is claimed constitute a promise. In this case since the actual statement made is not available to us, the petitioners can only base their case on the statement made in the meeting of the Bihar Chambers of Commerce, which is said to have been tape recorded. I have already quoted the English translation of the original which is in Hindi. The Minister therein does not unequivocally state that if in future any one brings any levy paid rice or paddy from outside the State, he would be exempted from the levy payable in the State of Bihar. What he has said is that a decision has been taken by the State Government that those, who have already, brought the levy paid commodity shall not have to pay levy again. Thus, there are no clear words to the effect that if in future any one brings levy paid commodity, he shall be exempted from the operation of the Procurement Order, The promise in order to be the basis for estoppel must be clear and unequivocal. It should not be capable of two meanings or interpretations. Such, in my view, is not the position here.
14. Coming to the question of equity it has to be noticed that the exemption can only be made under the Procurement Order when a proper notification or executive instruction under Clause 13 of the Order, has been issued. These have to be in writing. Every one knows that the Government orders, of even minor magnitude, are issued in writing. The petitioners and other traders would expect that if any Government decision is taken it would be followed by written order or instruction. It is only an imprudent person who would act on mere oral statement of persons in authority in Government. It would be also in my view against public interest to bind down the Government on the basis of oral statements made by officers of the State, however high their position.
In this situation, I am of the opinion that it cannot be held that it would be inequitable if the Government is not bound down to the oral statement made by the Minister.
15. I may also point out that in the original petition the petitioner had not pleaded the statements of the Minister on which the plea of promissory estoppel is founded. They have been stated only in the supplementary affidavits. Had the petitioners imported the rice on the basis of the said statements, they would have pleaded the same in the main application.
16. Learned counsel for the petitioners contended that Clause 4 of the Procurement Order constitutes unreasonable restriction to the right of the petitioners to carry on their trade and business and is thus violative of Article 19 (1) (g) of the Constitution. It was pointed out that no stock can be removed from the wholesalers’ business premises without delivery of levy demand pertaining to such stock. It has been explained in the counter-affidavit that the restriction on removal of stock becomes applicable only when the dealer refuses to deliver the demand of levy made on him, as the delivery has to be made as soon as the demand is made. In view of what has been explained in the counter-affidavit, the provision aforesaid is reasonable. In fact no one has yet complained that in actual working there is any difficulty because of the aforesaid provision.
17. Learned counsel for the petitioners contended that the seizure in this case is illegal. We referred to Clause 8 of the Procurement Order, which states that where there is failure to sell the quantity of rice and/or paddy, it shall be lawful for the District Magistrate, and other authorities mentioned in the said clause, to order seizure of the entire stock of rice or paddy found within the premises of a licensee after giving him an opportunity of being heard. Learned counsel pointed out that no such opportunity was given. But, however, it has been noticed that the entire quantity of stock is not meant to be seized but a direction has only been given that the amount of levy due cannot be deemed to be seized. In other words the direction is that the amount of levy due cannot be removed. This is consistent with Clause 4 of the Order. The authorities have not, in my view, attempted to exercise power under Clause 8 of the Procurement Order.
18. In the writ petitions certain other, contentions, relating to the validity of the Procurement Order, have also bean raised, but they were not pressed at the time of hearing and in my view rightly, as this Court has already upheld the constitutional validity of the Procurement Order.
19. In the result I am of the view that the petitioners cannot get the reliefs that they seek in these writ applications. They are, accordingly, dismissed, but in the circumstances, without costs.
U.C. Sharma, J.
20. I agree.