JUDGMENT
1. Five different firms have filed writ petition No.5762 of 1997 against the Food Corporation of India and five others, for obtaining a writ of Mandamus directing the respondents 2 and 3 to supply January 1997 wheat quota at the price prevailing prior to 5-2-1997, Similarly in WP No.5495 of 1997 four different firms have sought similar directions against the respondents 2 and 3 and in WP No.8553 of 1997 one firm has sought similar directions against the respondents 2 and 3. Since issues involved in all the three writ petitions are the same, the same are being dealt with and disposed of by this common judgment.
2. The petitioner’s case is that wheat and wheat products were declared as essential commodities in the recent past before the writ petitions were filed. Since wheat was brought within the purview of State Licensing Order i.e., the A.P. State Schedule Commodities Dealers (Licensing and Distribution) Order, 1982, the State Government through a (hree member committee had been fixing the prices of sale of wheat and wheat products. The Food Corporation of India (for short ‘the FCP) allotted 2,700 metric lonnes of wheat to Andhra Pradesh for distribution under Open Market Sale Scheme (for short ‘OMSS’) for the month of December 1996. The current policy of the Central Government was to allot 60% of the total allotted wheat to the Roller Flour Mills subject to a maximum of 500 metric tonnes per mill per month. For the month of December 1996, 41 Roller Flour Mills were given 365 metric tonnes each according to instruction issued by FCI on 6-12-1996. Once again, 70 metric tonnes of wheat were allotted to each mill in addition to 365 metric tonnes. Accordingly all the 41 Roller Flour Mills lifted the quota allotted to them.
3. The FCI, New Delhi, issued instructions dated 27-12-1996 (No J/1 (1)/97/ PY/S.III/Jan.97) to the effect that the same policy which was adopted for the month of December, 1996 shall be adopted for the month of January, 1997. The instructions were as under:
“No.J/1(1)/97/PY/S.III/Jan.97 (.) Ref. HQRS.FAX/Telex Messages of even number dated 6th , 7th, 10th, 19th and 24th December, 1996 regarding Open Sale of Foodgrains Under OMSS (Domestic) for December, 1996 (.) The Region wise quantities of wheat and rice allotted for December, 1996 are repeated for January, 1997 also for Open Sale Under OMSS (D) without any change.”
The instructions dated 6-12-1996 referred to above related to the general policy of allocation of wheat. The message dated 7-12-1996 dealt specifically with allocation of wheat to Roller Flour Mills. But instructions dated 24-12-1996 related to the procedure for allotment of wheat and fixation of price in respect of Wheat and Wheat products. Under paragraph ‘C’ of the instructions dated 6-12-1996 and instructions dated 7-12-1996, wheat was to be allotted to all working mills subject to a maximum of 500 metric tonnes of wheat per mill per month.
4. According to the petitioners, the memo dated 7-12-1996 was inconsistent with the instructions issued by the FCI and, therefore, Writ Petition No.2063 of 1997 was filed for obtaining a writ of Mandamus to direct the respondent to allot and release wheat to the petitioners on par with other roller flour mills. The Writ Petition was admitted and in WP MP No.2438 of 1997 the 4th respondent was directed to supply wheat according to the quota to the petitioners as per the procedure which existed prior to 27-2-1997 if the petitioner mills were found working for a continuous period of one month prior to the allotment of quota. In pursuance of these directions, the 4th respondent initially issued proceedings dated 8-2-1997 allotting 339 Metric Tonnes to each mill. At that juncture, the A.P. Backward Area Small Scale Roller Flour Mills’ Association submitted representations to the 4th respondent on 20-2-1997 to allot 500 Metric Tones of wheat as per Government of India Policy whereupon the 4th respondent issued revised proceedings dated 21-2-1997 allotting 500 Metric Tonnes of wheat to each of the petitioners.
5. Further, according to the petitioners, the issue price of wheat of the FCI in the month of January 1997 was Rs.5,490/- per metric tonne plus local taxes. All the 26 mills were allotted wheat at the same rate. The Government of Andhra Pradesh fixed the price of wheat products vide G.O. Ms. No.711 Food, Civil Supplies and Consumer Affairs (CS-1V) Department dated 28-12-1996 as follows:
Wheat/Wheat products
For areas which are supplied
wheat at the prices fixed for
Hyd.
Visakhapatnam
Madras
Bangalore
Rs. ps.
Rs. ps.
Rs. ps.
Rs. ps.
2.
Wheat products: (Ex. Mill price per qtl. excluding
taxes.)
(a)
Resultant atta
700-00
700-00
70000
700-00
(b)
Ravva
80000
800-00
80000
800-00
(c)
Maida
850-00
850-00
850-00
850-00
(d)
Wholemeal atta
709-00
718-00
719-00
72500
Accordingly all the Roller Flour Mills lifted the wheat at Rs.5,490/- per metric tonne. In the meantime, in WP No.2063 of 1997 which was filed on 4-2-1997 interim orders were granted on 6-2-1997. On 5-2-1997 the FC1 enhanced the issue price of wheat from Rs.5,490/- per metric tonne to Rs.7,500/- per metric tonne. Tills rise, according to the petitioners, was abnormally high and was applicable in respect of Southern States. In so far as the Northern States were concerned, there was no change in the price, which according to the petitioners, revealed that there was no change in the procurement cost. Further, according to the petitioners, the issue price was revised without consulting the State Government and in view of the fact that wheat was classified as essential commodity, the controls such as price control, storage, control etc., were to be prescribed by the State Government as per the provisions of A.P. Schedule Commodities (Licensing and Distribution) Order 1982 and that the State Government was monitoring the sale price of wheat and wheat products. It appears that by G.O. Ms. No.112 dated 18-2-1997 issued by the State Government in consultation with the trade representatives the prices of wheat products were revised upwards on the basis of wheat purchased at the revised price of Rs.7,500/-per tonne.
6. Further, according to the petitioners, though the quota related to January 1997, due to high handed and arbitrary action of the respondents, wheat was not allotted to the petitioners during that period. The FCI was insisting on the petitioners to lift the wheat stocks at the revised price of Rs.7,500/-per Metric Tonne. The proceedings of the 4th respondent dated 8-2-1997 and the revised proceedings dated 15-2-1997 and 21-2-1997 did not specify the issue price. According to the 4th respondent’s proceedings, petitioners had to sell the wheat products to the consumers as per the rates fixed in the G.O. Ms. No.711 dated 28-12-1996. According to the petitioners, they had no objection to sell the products to the consumers at that price, but after the revision of issue price none lifted wheat from FCI. According to the petitioners, since the quota related to the month of January, 1997, it was required to be issued to the petitioners at the price prevailing during January 1997 and that the allotment was delayed only because of arbitrary action of the respondents.
7. Further, according to the petitioners, in the entire Southern India, only in Andhra Pradesh the price control was imposed by the State Government and in all other States there was no control on wheat products. In Andhra Pradesh, the sale of wheat products was restricted to the State which was not the case in the neighbouring States like Karnataka, Orissa, Madras, etc., as a result of which wheat products from other States were dumped in Andhra Pradesh and due to restrictions, the Roller Flour Mills in Andhra Pradesh were unable to compete with the products of the other States.
8. In the common counter affidavit filed on behalf of the 2nd and 3rd respondents, the Senior Regional Manager, FCI, Hyderabad, stated that the 6th respondent (Commissioner of Civil Supplies, Hyderabad) allotted wheat to all the petitioners for February, 1997 and March, 1997. But the petitioners (Except Petitioner No.5) did not lift the quota allotted to them for January, February and March, 1997. Further, according to the respondent, the Government of India, Ministry of Food and Civil Supplies (Department of Food), by order dated 30-10-1996 rescinded the Wheat Roller Flour Mills (Licensing and Control) Order 1957 and that after rescinding the Order, there was no obligation on the Central or on the Food Corporation of India or even on the petilioners to depend on each other for supply/ purchase of wheat. The primary duty of the FCI was to undertake the purchase, storage, movement, transport, distribution and sale of food grains and other stuffs. Merely because FCI was supplying wheat to the petitioners, it could not be construed that there was a statutory duty of FCI to supply wheat to the petitioners. Even under Section 13 of the Food Corporation of India Act, 1964 (for short ‘the Act’), there was no statutory obligation to supply wheat to the petitioners. As per Section 6(1) of the Act, the general superintendence, direction and management of the affairs and business of the Corporation vested in the Board of Directors. Only on the question of policy, the Board of Directors of FCI had to be guided by such instructions as may be given to it by the Central Government, and therefore, according to the respondents, the petitioners were not right in generalising that for every aspect, FCI was depending upon the Central Government. Sub-section (2) of Section 6 of the Act provides that the Board of Directors, in discharging its functions, shall act on ‘business principles’ having regard to the interests of the producer and the consumer and shall be guided by such instructions on questions of policy as may be given to it by the Central Government.
9. The respondents also deny that wheat products were declared as essential commodities. It was conceded that the Government of India vide its letter dated 21-12-1996 decided that the entire allocation of wheat available for open sale in a State would be communicated to the concerned State for distribution with immediate effect. The respondents however deny that the State Government through a three member Committee had been fixing the prices of sale of wheat and wheat products. The rate of wheat of OMSS (D) was decided by the Central Government and the said rate, so fixed, had to be collected by FCI at the time of sale. It is further contended by the respondents that upto December, 1996, the allotment of wheat under OMSS (D) was made through the three member-committee, but from January 1997 onwards, in view of the acceptance of allocation of wheat under OMSS (D) the State Government was making allotments to various purchasers in accordance with the priorities/guidelines issued by the 2nd respondent. Further, according to the respondents, the instructions dated 24-12-1996 empowered the State Governments to fix the prices of wheat and wheat products before nominating their allottees to purchase wheat from the FCI under the OMSS (D).
10. As far as issue price is concerned, it is contended by the respondents that the same was fixed at Rs.5,492/- per Metric Tonne plus local taxes at Hyderabad (Ex.FCI) during January, 1997 and that after allotting wheat to 26 flour mills on 27-1-1997, the 2nd respondent communicated the revised prices of wheat to be sold under OMSS (D) through fax message dated 4-2-1997. The said communication was made in pursuance of the direction given by the 1st respondent. According to the said fax message, the revised sale prices of one metric tonne of wheat at Hyderabad was fixed at Rs.7,500/-. It is conceded by the respondents that the Government of Andhra Pradesh under G.O. Ms. No.711 dated 28-12-1996 fixed the prices of wheat products and in view of the revision of sale price of wheat, the 5th respondent revised the prices of wheat products fixed under G.O. Ms. No.711 dated 28-12-1996.
In para 2 of the said G.O., it was stated that the revision of price of wheat products was ordered after consultation with the representatives of the Roller Flour Mills, etc. This revision of the prices of wheat products, according to the respondents, was made only because of the revision of the price of wheat from Rs.5,492/- to Rs.7,500/- per metric tonne. Further, according to the respondents, as per instructions dated 6-12-1996, which were repeated for the month of January 1997, the prices as applicable on the date of issue/ lifting/delivery, were to he collected as per the procedure in vogue and it was not correct to state that the FCI had increased the issue price only in respect of Southern States. According to the respondents, as per the fax message dated 4-2-1997, the issue price at Guwahati was fixed at Rs.7,500/- per metric tonne. Similarly at Indore, it was fixed at Rs.7,200/- in Calcutta at Rs.7,400/-, in Mumbai at Rs.7,400/- and in Ahmedabad at Rs.7,300/-. Therefore, according to the respondents, the contention that the issue price was not increased in the Northern States was untenable and not correct. Further, according to the respondents, it was not necessary to consult the State Government before revising the issue price and that the FCI was selling wheat as per the rates fixed by the Central Government from time to time. Normally, according to the respondents, the revision of rates depended on many factors like supply and demand, transportation, handling charges, etc., and all relevant factors were to be taken into consideration by the Central Government before fixing the prices of wheat. The State Government was monitoring the sale price of wheat and wheat products in view of the directions issued by the FCI. But merely because the State Government was monitoring the sale price of wheat and wheat products, it did not mean that the sale price of wheat to be supplied to the petitioners could be revised only after consultation with the State Government. In any case, according to the respondents, the State Government had revised the sale price of wheat products immediately after the revision of sale price of wheat by the Central Government.
11. It is further clarified by the respondents that in cases of allotments made on 27-1-1997, from those who took delivery subsequent to the revision of prices the FCI collected the revised rate of wheat with effect from 5-2-1997 and therefore the insistence on payment of the revised price was not unjustified. It was not correct to say that the petitioners had to sell wheat products to the consumers as per the rates fixed in G.O. Ms. No.711 dated 28-12-1996. Further, according to the respondents, the petitioners were not put to any loss on one hand and on the other hand, they were entitled to sell their wheat products as per the revised rates fixed by the Government of Andhra Pradesh. It was also not correct to say that none lifted a single grain of wheat from the FCI after revision of wheat issue price. In fact M/s. Tirupathi Roller Flour Mills, Patancheru, Jitendra Roller Flour Mills, Shalimar Roller Flour Mills, Patancheruvu, Medak district lifted wheat after revision of wheat prices, according to the respondents.
12. Further according to the respondents, the prices of wheat products were fixed by the State Government in consultation with the representatives of the Roller Flour Mills and, therefore, the petitioners were not entitled to go back upon their words and say that there was no price control of wheat products in other States. The sale price of wheat, according to the respondent, was uniformly revised by the Government of India and the same was communicated by the 2nd respondent vide fax message dated 4-2-1997. But, the petitioners did not lift the quota allotted to them for the month of January 1997 under one pretext or another right upto 22-2-1997 which was the last date for lifting the quota. The petitioners also did not lift the quota allotted to them even for the month of February, 1997. As FCI was allotting wheat every month under the OMSS (D), the quota allotted to them for respective month had to be delivered on or before the date fixed by the 2nd respondent for the respective month. If delivery was not accepted before that date, the quota would lapse unless a specific order of effecting delivery was passed by the 2nd respondent.
13. Further, according to the respondents, petitioners could have made a representation to the Central Government for reduction of the revised rates of wheat as the revision of wheat prices was fixed by the Central Government.
14. It is pertinent to note that A.P. Backward Area Small Scale Roller Flour Millers’ Association vide its representation dated 20-2-1997 addressed to the 6th respondent (The Commissioner of Civil Supplies) did not make any complaint with regard to the price of wheat, but only prayed for the allotment of additional 16i metric tonnes so as to cover the short fail in the quantity of 500 metric tonnes allotted to their member units. The Association also urged in the said representation to grant extension of time for lifting of wheat beyond 22-2-1997 as very short time was available with them and in fact three weeks time was sought by the Association for lifting the stocks of wheat.
15. In the 2nd representation made on the same date i.e., 20-2-1997 to the 3rd respondent (The Senior Regional Manager, FCI, Hyderabad) the Association made a statement in the 3rd paragraph of page 2 of the representation that “the issue price of the wheat was Rs.5,490/- per ton plus local taxes at the time of the first order issued by the Commissioner of Civil Supplies dated 27-1-1997 to other Roller Flour Mills”. However, beyond making the statement that the issue price of wheat was Rs.5,490/- per ton in January ‘997, not a word is stated that they should be allowed to lift the stock only at the rate of Rs.5,490/- per metric tonne and not at the revised price of Rs.7,500/- per metric tonne.
16. On 21-2-1997, the Commissioner of Civil Supplies, in its proceedings No.N 1/50/97. addressed to the FCI, conceded that “in compliance to the orders of Hon’ble High Court of Andhra Pradesh, in partial modification of the orders issued in this regard, a total quantity of 500 Mts. was allotted to each of 15 Roller Flour Mills which were not allotted through the proceedings 8th, 9th and 10th, out of the quantities surrendered by certain Roller Flour Mills, unallotted quantities and 8,100 Mts. surrendered by RKFFD against the allotment of January, 1997.
17. It is also pertinent to note that vide proceedings No.N1/50/97 dated 15-2-1997, the Commissioner of Civil Supplies, Hyderabad, directed the Roller Flour Mills to sell the stocks of wheat products within Andhra Pradesh at the rates fixed by the Government. The last date for lifting of wheat under OMSS allotted for January 1997 was 22-2-1997 as communicated by the said proceedings.
18. Vide G.O. Ms. No.275/CC.lV/97-l dated 27-1-1997, the Food, Civil Supplies and Consumer Affairs Department of Government of Andhra Pradesh, stated that after examining the matter carefully, it had been decided to allot the OMSS wheat for January, 1997 as follows:
“(a) 60% of the total stocks shall be allotted equally to all Roller Flour Mills which are actually in operation for the last 3 years and working at the present, subject to their furnishing copies of the details of their turnover and tax returns.
(b) 10% of the total stocks shall be allotted for sale through fair price shops, A.P. State Cooperative Consumer Federation (FEDCON) and Hyderabad Agricultural Cooperative Association (HACA) either in the shape of wheat or wheat products.
(c) Balance 30% shall be allotted to A.P. Markfed for sale in A.P. Stale al the prices fixed by Government.”
It is further stated in the said Memo dated 27-1-1997 that the prices fixed for December 1996 shall be applicable for January 1997 also.
19. It emerges from what is stated hereinabove that the State Government did not exercise any control over wheat to be supplied to the Roller Flour Mills in Andhra Pradesh and the FCI was exercising this power. The State Government was monitoring the sale price of wheat and wheat products in view of the directions issued by FCI. In that view of the matter the petitioners were at liberty to sell wheat products at the prices fixed by the State Government and to lift the stocks of wheat at the price fixed by FCI under protest and therefore to lodge a claim for refund of the excess amount from FCI by demonstrating how the revised prices of wheat were not compatible with the prices on which wheat products were allowed to be sold by the State Government, so that the extent of loss suffered if any, could be determined and appreciated for the purpose of deciding whether the petitioners were entitled to any refund. But by not lifting the stocks at al! at the revised price and not thereby suffering any actual loss in the sale of wheat products, the petitioners are not justified in making any grievance against FCI or other authorities merely by alleging that the decision of FCI was arbitrary and discriminatory.
20. Let us have a look at the relevant provisions of the Food Corporation Act 1964 to find out whether there is any justification in the grievances made by the petitioners in the present Writ Petitions. Sections 6 and 13 of the Act which are relevant are reproduced below:
“Section 6 : Management :–(1) The general superintendence, direction and management of the affairs and business of the Corporation shall vest in a Board of Directors which may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation under this Act.
(2) The Board of Directors, in discharging its functions, shall act on business principles having regard to the interests of the producer and consumer and shall be guided by such instructions on questions of policy as may be given to it by the Central Government.
(3) If any doubt arises as to whether a question is or is not a question of policy, the decision of the Central Government thereon shall be final.”
“Section 13 : Function of Corporation :
(1) Subject to the provisions of this Act, it shall be the primary duty of the Corporation to undertake the purchase, storage, movement, transport, distribution and sale of food grains and other foodstuffs.
(2) Subject as aforesaid, the Corporation may also, with the previous approval of the Central Government:
(a) Promote by such means as it thinks fit the production of food grains and other food stuffs;
(b) set up, or assist in the setting up of rice mills and other undertakings for the processing of food grains and other food stuffs; and
(c) discharge such other functions as may be prescribed or as are supplemental, incidental or consequential to any of the functions conferred on it under this Act.”
The above provisions of law do not place any restriction on the powers of FCI to increase the prices of the commodities handled by them, if and when necessary. It is true that on a question whether it is or it is not a question of policy, the decision of the Central Government is final and PCI is bound by such decision. In the instant case, it is quite obvious that the FCI followed the Central Government’s direction and it is not within the domain of the Court to intrude upon the decision based on the policy of the Central Government. The writ of the Court cannot run against any action of the Centra! Government or the State Government or against the Agencies controlled by the Central and State Governments if it is relating to the policy of the Government unless it is in violation of the provisions of the Constitution of India or any statute or if it is discriminatory. But no such proposition could be gathered from the facts before us in these writ petitions. The overwhelming factor however is that there was no price control or distribution control on wheat at the relevant time and, therefore, there was no obligation on part of FCI to supply wheat at a particular price only.
21. Believing it to be true that communication of the revision in price of wheat was delayed, it does not ipso facto entitle the petitioners to claim supply of wheat at pre-revised prices unless it was shown that the petitioners incurred heavy losses on account of the prices working out to be uneconomical in relation to the prevailing market prices of wheat products either by supplies for January 1997 not made available at the pre-revised prices or by procuring wheat from the open market and selling wheat products at the prevailing rates which worked out to be disproportionate and uneconomical and thereby subjecting the petitioners to heavy loss. At this stage, if FCI is directed to supply January 1997 quota at the old pre-revised prices, it would clearly mean that unjust enrichment is conferred upon the petitioners through the instrumentality of the FCI, which of course, could not be permitted.
22. Several judgments were cited before this Court touching the controversy of a like nature in the past. In a decision of the Division Bench of this High Court in WA No.1487 of 1988 dated 6-3-1997, it was held that when it was the case of the appellant-FCI that it was bound by the instructions issued by the Head Office and when the directions given by the learned single Judge to the effect that while making allotment of wheat to the respondent-mills, the aforesaid directions issued by the Head Office on 23-3-1988 modifying the criteria laid down earlier should be complied with strictly, we are unable to comprehend as to why this appeal was brought by the FCI. Eventually, the Division Bench confirmed the directions given by the learned single Judge by observing that the same were in conformity with the circular issued by the Head Office of the FCI on 23-3-1988 altering the criteria laid down earlier as the appellant was bound by the same and it cannot now contend that the respondents are not entitled to any wheat quota on the basis of the aforesaid circular and in the result, affirming the view taken by the learned single Judge with the modification that the reference to Government of India’s circular should be read as instructions of the FCI Headquarters, dismissed the writ appeal. Simultaneously, it was observed by the Division Bench that the benefit of the judgment of the learned single Judge would accrue only to respondents 1 to 3 but not to the 4th respondent as it was represented that the entire quota of wheat which was claimed by the 4th respondent was supplied to it.
23, In the instant case, FCI did not refrain from making allotment of wheat according to the quota fixed for the Millers but the same was not lifted by the Millers on the ground that FCI unjustifiably demanded the revised price of Rs.7500/- per metric tonne for the allotment made in respect of the month of January, 1997. 1 have already expressed my view above that there was no justification in the demand made by the petitioners that January 1997 quota of wheat should be supplied to them at the prc-revised prices. The controversy before me is altogether different from the one with which the Division Bench in the above case was confronted.
24. In another judgment of the Division Bench of this High Court in WP No.17160 of 1988 decided on 20-6-1996, a direction was given to the petitioner (M/s. Gopal Roller Flour Mill) io file a petition before the Senior Divisional Officer (2nd respondent) stating all facts and requesting for supply of wheat which was not supplied to it i.e., 295.5 MTs. and the said officer was directed by the Division Bench to verify the records tiled by the petitioner with the record which was with him and in case it was found that the balance of 295.5 MTs. of wheat for the month of March 1988 was not supplied to the petitioner, he was directed to supply the same. But if it was found that the supply had already been made, the Officer was directed to pass appropriate orders. I am afraid, the facts of the case before us are totally different from the facts with which the Division Bench in WP No.!7160 of 1988 was concerned. Since the decision of the Division Bench in the above case was a fact oriented decision, and the facts being totally different before us in the instant case, this case cannot be treated in the same manner as emerging from the aforesaid decision of the Division Bench.
25. However, a decision of the Karnataka High Court in WA Nos.470 to 491 of 1986 decided on 5-1-1988 throws an ample light on the stand to be taken in the event of increase in prices of wheat. The Division Bench of the Kamataka High Court observed that the price at which wheat was supplied from 1-8-1982 was Rs.185/- per quintal and further observed that the ex-mill sale price of wheat product at which they were required to sell stood revised to Rs.208/-pcr quintal with effect from 15-4-1982. It is further observed that there was no dispute that prior to 15-4-1982 the appellants held stock of certain quantities of wheat purchased at the then prevailing rates and that they sold the wheat products derived out of such wheat at the revised rates whereby their margin of profit increased. An official Memorandum dated 9-8-1982 was issued calling upon the appellants to remit the amount of increased profit to the Government. Instructions were given in the said Memorandum in these words:
“The Roller Mills are hereby directed to credit the differential costs between the old rate and the revised rates to the Chief Accounts Officer, Food and Civil Supplies, Department, Bangalore.”
The appellants filed the writ petitions challenging the authority of the Director of Food and Civil Supplies, Bangalore to recover the said amount. The appellants referred to and relied upon the decisions of the Supreme Court in Venkata Subba Rao v. Slate of Andhra Pradesh, , and Patna High Court in Bokaro Roller Flour Mills v. Union of India, , and contended that the question of law arising for consideration was covered by the Judgment of the Supreme Court. The learned single Judge took a view that these cases were distinguishable from the judgment of the Supreme Court on the ground that Clause 10 of the Licensing Order expressly provided for issue of direction for remitting the increased amount of profit by the dealer under such circumstances. The learned Counsel for the appellants before the Division Bench submitted that the interpretation of Clause 10 by the learned single Judge was erroneous and that none of the sub-clauses of Clause 10 conferred any such power. He also submitted that in view of the latest judgment of the Supreme Court in CA Nos.1444 to 1459 of 1986 dated 29-1-1987 confirming the view taken by the Delhi High Court in Delhi Flour Mills v. Commissioner of Food Supplies, AIR 1985 Delhi 312, the contentions of the appellants had to be upheld. The Division Bench observed that clause V of the conditions of licence made it obligatory for the licensees to abide by any directions issued by the Licensing Authority. But the direction issued, in order to be binding must be the one issued by the authority of law, and therefore, the crucial question for consideration was whether Clause 10 on which the respondents relied conferred power to issue the impugned direction and whether the respondents had the authorily to refix the price after completion of the sale. The Division Bench observed that a reading of various sub-clauses of Clause 10 would show that there is no power vested in or reserved for the Director of the Government to call upon the licensee to remit the amount of increased profit earned as a result of selling the wheat products derived out of the wheat purchased and held in stock prior to the revision of the rates of the wheat, at the revised rates. the Division Bench further held that since the sale had been completed, the respondents had no authority to re-fix the price. On a similar question raised regarding the increased profit earned consequent on the revision of price of the paddy from the dealers the Division Bench referred to Venkata Subba Rao’s case (supra) in which the Supreme Court held that after purchase of paddy the dealers became the owners of paddy and the Government cannot claim the excess of profit earned by the dealers on account of revision of selling price. The Division Bench further observed that in the circumstances similar to the those before them, the Patna High Court in Bokaro Roller Flour Mills’ case (supra), reiying on the principle laid down by the Supreme Court in Venkata Subba Rao ‘s case (supra) held as below:
“The Direction to pay the differential amount must flow from the Licensing Order either by express provision or even by implication. No doubi the licensing authorities have power under Clause 10 to issue direction from time to time and the licensees are also bound to carry out the direction. A similar provision is also in Form II of the licence as contained in clause V. But these powers cannot be stretched to the extent of asking for extra amount which the petitioners have received due to the enhancement of the price. Moreover the authorities have no authority to redetennine the price when the sale of wheat to licensees has become complete and make such demand.”
The Division Bench further observed that the power to fix or revise the rates of wheat products could not be regarded as including the power to recover the increased profit earned consequent on revision of sale price of wheat products. Disagreeing with the views expressed by Patna High Court on Bokaro Roller Flour Mills’ case (supra), the leaned single Judge held as under:
“Even though there was an increase in the sale price with the result that the Mills could now sell the wheat at a new increased price and would automatically obtain higher benefit, still no such direction could be given. The effort to mop up, by the Government by the impugned orders, of the difference between the old and the new prices had no legal basis. The claim for refund could not be resisted.”
26. The decision of the Delhi High Court in Delhi Flour Mills’ case (supra) was upheld by the Supreme Court in Civil Appeal Nos.1444 to 1459 of 1986 decided on 29-1-1987. While dismissing the appeals of the Union of India, the Supreme Court held as follows:
“The appeals are heard on merits. We are of the opinion that these appeals have to be dismissed in view of the decision of this Court in A. Venkata Subba Rao v. State of Andhra Pradesh (supra) since the question raised in these appeals is fully answered against the Government in the said decision.”
Eventually the Division Bench of the Karnataka High Court directed the respondents to forbear from claiming the difference and to refund forthwith the amounts, if any, already collected from any of the appellants.
27. In the case before us, the petitioners neither suffered any loss nor gained any profit by abstaining from lifting their quota for January 1997 at the enhanced rate of Rs.7,500/- per tonne. If they had lifted wheat at the revised price they would have probably earned profit on account of rise in prices of wheat products fixed by the Government of Andhra Pradesh. The possibility of loss for that matter can also not be ruled out. But by not lifting their quota they have themselves caused “loss of profit” to them for which no blame could be attributed to FCI. Of course, they would have earned greater profit if January 1997 quota was supplied to them at the pro-revised prices but the petitioners let that opportunity slip by their own inaction. If any such right existed by virtue of any conditions of licence or by virtue of the provisions of any statute, the Court could not have denied the benefit of the same to the petitioners. But in the absence of any such statutory or contractual right no writ can issue from the Court of law which will produce the effect of enabling the petitioners to earn unjust enrichment. If the petitioners instead of totally refraining from lifting January 1997 quota at the enhanced priced, had lifted their quota at the enhanced price under protest, they could have come forward with legitimate grievance to refund the difference in prices or atleast to reimburse the loss suffered by them if any, but at this belated stage after the whole impact of the rise in price of wheat has vanished in air, it is not in order for the Court to intervene and direct the FCI to supply the quota of January 1997 at the pre-revised price. The whole concept of distribution of vital grains through FCI is to ensure fair and equitable distribution at fair and equitable price. To talk in terms of commercial language by taking advantage of some technical flaw here and there is to defeat the very purpose of channelising the distribution system through a State Agency.
28. If the petitioners still believe that injustice is done to them and they have been put to a great financial disadvantage, they may, if they so desire and if they are so advised, initiate an action in damages in a civil Court and in that eventuality the Civil Court may examine all issues on merits without being influenced by any opinion expressed in this order.
29. I am, therefore, of the considered view that the petitioners cannot seek issuance of writ of Mandamus against FCI to supply January 1997 quota at the pre-revised price as prayed for in this writ petition and hence the relief claimed in all the three writ petitions do not call for any direction to be given to FCI as prayed for. Hence all the three writ petitions are dismissed. No costs.