{"id":206758,"date":"1963-04-16T00:00:00","date_gmt":"1963-04-15T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/dava-son-of-bhimji-gohil-vs-joint-chief-controller-of-imports-on-16-april-1963-2"},"modified":"2015-08-20T19:37:06","modified_gmt":"2015-08-20T14:07:06","slug":"dava-son-of-bhimji-gohil-vs-joint-chief-controller-of-imports-on-16-april-1963-2","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/dava-son-of-bhimji-gohil-vs-joint-chief-controller-of-imports-on-16-april-1963-2","title":{"rendered":"Dava Son Of Bhimji Gohil vs Joint Chief Controller Of Imports … on 16 April, 1963"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Dava Son Of Bhimji Gohil vs Joint Chief Controller Of Imports … on 16 April, 1963<\/div>\n
Equivalent citations: 1962 AIR 1796, \t\t 1963 SCR (2)\t 73<\/div>\n
Author: N R Ayyangar<\/div>\n
Bench: Ayyangar, N. Rajagopala<\/div>\n
           PETITIONER:\nDAVA SON OF BHIMJI  GOHIL\n\n\tVs.\n\nRESPONDENT:\nJOINT CHIEF CONTROLLER OF IMPORTS & EXPORTS\n\nDATE OF JUDGMENT:\n16\/04\/1963\n\nBENCH:\nAYYANGAR, N. RAJAGOPALA\nBENCH:\nAYYANGAR, N. RAJAGOPALA\nAIYYAR, T.L. VENKATARAMA\nSINHA, BHUVNESHWAR P.(CJ)\nSUBBARAO, K.\nMUDHOLKAR, J.R.\n\nCITATION:\n 1962 AIR 1796\t\t  1963 SCR  (2)\t 73\n CITATOR INFO :\n R\t    1962 SC1810\t (20)\n R\t    1963 SC1470\t (9)\n F\t    1973 SC2711\t (13,18)\n R\t    1974 SC 366\t (96)\n RF\t    1975 SC1564\t (28)\n\n\nACT:\nExport\t Control--Manganese  Ore--Notifications\t  canalising\nexport\tand preventing new entrants from  exporting--Consti-\ntutionality   of--State\t Trading  Corporation--Monopoly\t  of\nexport created in favour of--If infringes fundamental  right\nto carry on, trade--Notification dated May 26, 1958--Exports\nControl Order, 1958--Imports and Exports (Control) Act, 1947\n(18 of 1947), s. 3--Constitution of India, Arts. 19 (1)\t (g)\nand 19 (6).\n\n\n\nHEADNOTE:\nThere  was little internal demand for manganese ore and'  it\nwas  extracted\tmainly for exporting out of  India.   Though\npreviously  there was no restriction on the grant of  export\nlicences   from\t  1956,\t the  Central\tGovernment   started\ncontrolling and restricting the export of manganese ore'  On\nMay  26, 1958, the Central Government issued a\tnotification\nwhich  contained  the policy statement for the\tperiod\tJuly\n1938  to  June\t1959 under which export quotas\twere  to  be\ngranted only to established shippers and mineowners who\t had\nexported  from\t1953  onwards  and  to\tthe  State   Trading\nCorporation.   Mine owners, like the' appellant who did\t not\nhave  an)  export  performance in the  earlier\t),cars\twere\nexcluded from the scheme.  They could sell their ore only to\nthe  established shippers are to the Corporation which\tthey\ncould  do  only. at unremunerative  prices.   By  subsequent\npolicy statements the export was canalised entirely  through\nthe  Corporation.   Section  3 of the  Imports\tand  exports\n(Control) Act, 1947 empowered the Central Government to make\norders restricting or controlling the imports and exports of\ngoods.\t The  Central Government made  the  Exports  Control\nOrder,\t1958,  cl.  6(h)  of  which  empowered\tthe  Central\nGovernment and the licensing authority to refuse to grant  a\nlicence\t \"if  the licensing authority  decides\tto  canalise\nexports\t  through   special  or\t specialized   agencies\t  or\nchannels\".   The  Notification of May 26, 1950,\t was  issued\nunder  cl.  6(h).  The appellants contended:  (I)  that\t the\nwithholding of the right to engage in the export trade\tfrom\na   class   of\tmineowners   constituted   an\tunreasonable\nrestriction on their fundamental right guaranteed under Art,\n19(1)(g),  (II) that cl. 6 (h) of the order was ultra  vires\nthe Central Government as s. 3 of the Act\n74\npermitted it to place restrictions only on goods and not  on\nthe  persons who might participate in the export, and  (iii)\nthat  the notification by which canalisation of exports\t was\naffected  was  outside\tthe  contemplation  of\"\t agency\t and\nchannel under 1. 6 (h).\nHeld  (per Sinha, C.J., Ayyangar, Mudholkar and Aiyar,\tthat\nthe  restrictions  and\tcontrol imposed\t on  the  export  of\nmanganese  ore by the Central Government were legal and\t did\nnot offend Art. 19(1) (g).\nThe  restriction  or control in the form of  channelling  or\ncanalising  the trade was not outside the limitations  which\nnight  be imposed on export trading by s. 3 of the  Act\t and\nconsequently cl. 6 (h) of the Order permitting\tcanalisation\nof  exports was within the rule making power of the  Central\nGovernment.   The  power  to  impose  restrictions  was\t not\nconfined  to  goods  but  extended  to\tpersons\t also.\t The\ncanalising  of the exports through the established  shippers\nand- mineowners was unobjectionable; canalising through\t the\nState  adding  Corporation  and\t the  progressive   increase\nthrough\t he corporation was a reasonable restriction in\t the\ninterests  of  he  general  public.   The  object  of  these\nrestrictions  and control was to enable a regular supply  of\nuniform\t quality  of he ore to the foreign buyers so  as  to\nensure\tthe  optimum  earning of  foreign  exchange  by\t the\ncountry,   and\tthis  could  rest  be  attained\t  with\t the\nCorporation  as the main agency engaged in the\ttrade.\t The\nState Trading' Corporation was a \"special\" agency or channel\nas contemplated by cl. (h) and the canalising could be\tdone\nthrough it.  A special agency is one which is more likely to\nachieve the object than other gencies or to achieve it in  a\nlarger 'measure than others.  Canalising necessarily implied the  exclusio\nn  of some groups, and if the  canalising  was\nvalid  the  appellant could not complain that  he  had\tbeen\nexcluded from the export trade.\nPer  Subba Rao, J.-The Notifications and  policy  statements\nwhich destroyed the trade of mine owners like the  appellant\ndid not impose reasonable restrictions on their\t fundamental\nrights\tand  violated Art. 19 (1) (g).\tThe  creation  of  a\nmonopoly or near monopoly for the export of manganese ore in\nfavour\tof  the\t State Trading\tCorporation  could  only  be\nachieved  by a law made in conformity with Art. 19 (6)\t(ii)\nand   not   by\tadministrative\taction\t like\tissuing\t  of\nnotifications and policy statement.  The power conferred  on\nthe  authorities  under cl. 6 (h) of the Order\tto  canalise\nexports through special or specialized agencies or  channels\nwas  well within the power conferred on the Central  Govern-\nment by s. 3 of the Act.  Further, the State Trading  Corpo-\nration\twas  a \"special\" agency within the  meaning  of\t cl.\n6(h).\n75\nBut  the canalising had to be done in such manner  that\t all\npersons engaged in the trade could participate in the export\nof the ore and no one was completely excluded.\n\n\n\nJUDGMENT:\n<\/pre>\n
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 226 of 1961.
\nAppeal\tfrom the judgment and order dated October 22,  1959,
\nof the Bombay High Court (Nagpur Berch) at Nagpur in Special
\nCivil.\tApplication No. 63 of 1959.\n<\/p>\n
A.   S.\t Bobde,\t G. L  Sanghi  and  Ganpat  Rai,  for  the
\nappellant.\n<\/p>\n
C.   K.\t Daphtary, Solicitor-General of India, Bihan  Narain
\nand P. D. Menon, for the respondents.\n<\/p>\n
1962.  April 16.  The Judgment of the Court was delivered by
\nAYYANGAR,  J.-This  appeal comes before us by  virtue  of  a
\ncertificate,  of fitness granted by the Nagpur Bench of\t the
\nHigh Court of Bombay under Arts. 132(i) and 133(1)(c) of the
\nConstitution.\tIt  arises out of a petition filled  by\t the
\nappellant under Art. 226 of the Constitution before the High
\nCourt  of  Bombay  at Nagpur  impugning\t the  constitutional
\nvalidity  of  certain notifications  and  directions  issued
\nunder  the Imports and Exports (Control) Act, 1947, and\t the
\nExport\t Control   Order,  1958,   framed   thereunder\t and
\nsubstantially  prayed  that the Joint  Chief  Controller  of
\nImports & Exports, Bombay impleaded as the first  respondent
\nshould\tbe directed to consider the application of the\tapp-
\nellant\tfor the grant of a licence to enable him  to  export
\ncertain\t manganese  ore\t which he had won  from\t his  mines,
\nwithout\t reference  to\tthe  impugned  notifications.\tThis
\npetition  was  dismissed by the learned Judges of  the\tHigh
\nCourt  who,  however, granted the appellant  is\t certificate
\nwhich has enabled him to file this appeal.\n<\/p>\n
76<\/span><\/p>\n
A  few\tfacts are necessary to be stated to  appreciate\t the
\nexact,\tgrievance  of the petitioner and  the  grounds\tupon
\nwhich the notifications etc. issued by government are stated
\nto contravene the Constitution and in particular to infringe
\nthe  freedom granted to the appellant under Part III of\t the
\nConstitution.\t The  appellant\t is  a\tlessee\tof   certain
\nmanganese mines in two areas of Madhya Pradesh.\t The  leases
\nare stated to have been granted to him in the years 1953 for
\na period of 20 years each, with an option for renewal if the
\nappellant  so  desired, under the Mineral  Concession  Rules
\n1949, for a like period.  It is an admitted fact that the in
\neternal\t  demand  for  manganese  ore  in  India   is\tvery
\ninconsiderable, so that the ore is extracted mostly for\t the
\npurpose\t of being exported out of India.  Having  regard  to
\nthe  date when the appellant obtained the mining leases,  he
\ncould  not  have won any appreciable quantity of  the  metal
\nduring\t1953,  nor, of course, could he\t hare  exported\t any
\nquantity of the ore won by him in or prior to the year 1953.
\nIt  is\tnow  necessary\tto  set\t out  the  history  of\t the
\nrestrictions on the export of manganese ore from 1953 up  to
\nthe  date relevant to the petition to understand the  points
\nsought\tto  be made on behalf of the  appellant.   Prior  to
\n1953,  i.  e., at a time before the  appellant\tentered\t the
\nmanganese  ore business, export of manganese ore was  freely
\nlicensed, i. e., the commodity was subject to restriction as
\nregards export, nor was any control exercised by  government
\non  the\t allotment of wagons for the movement  of  manganese
\nore.   As  the export of the ore began to expand  from\tthat
\ndate,  the  Railways  found themselves unable  to  meet\t the
\nincreased demand for wagons and were forced to regulate\t the
\nappellant  of such wagons.  The government also took a\thand
\nin regulating the
\n77<\/span>
\n movement of wagous by evolving a system of registration  of
\nshippers  for whom priority in the allotment of\t wagons\t was
\nensured.   It  has  to be added\t that  this  regulation\t and
\ncontrol\t  over\twagon  allotment  and  wagon  movement\t was
\ncoordinated  with  and correlated to certain  changes  which
\nwere  effected\tfor regulating the export of  the  commodity
\nitself.\n<\/p>\n
Section 3 of the Imports and Exports (Control) Act, 1947 (to
\nbe referred hereafter a,; the Act) enacts :\n<\/p>\n
\t      “3.   Powers to prohibit or  restrict  imports
\n\t      and exports-(1) The Central Government say, by
\n\t      under published in the Official Gazette,, make
\n\t      provisions  for  prohibiting,  restricting  or
\n\t      otherwise\t Controlling,  in all  cases  or  in
\n\t      specified\t classes  of cases, and\t subject  to
\n\t      such  exceptions if any, as may be made by  or
\n\t      under the order
\n\t      (A) the Import, export, carriage coastwise  or
\n\t      shipment\tas  ships  stores of  goods  of\t any
\n\t      specified description.\n<\/p><\/blockquote>\n
\t      (b)   the\t bringing into any port or place  in
\n\t      India  of goods or any  specified\t description
\n\t      intended\tto  be taken out  of  India  without
\n\t      being reserved from the ship or conveyance  in
\n\t      which they are being carried.\n<\/p><\/blockquote>\n
\t      (2)   All goods is which any order under\tsub.
\n\t      section  (1)  applies shall be, deemed  to  be
\n\t      goods  of which the import or export has\tbeen
\n\t      prohibited  or restricted under section 19  of
\n\t      the  Sea Customs Act, 1878 (VIII of 1878)\t and
\n\t      all  the\tprovisions of that  Act\t shall\thave
\n\t      effect  accordingly, except that\tsection\t 183
\n\t      thereof  shall have effect as if for the\tword
\n\t      “shall’\tthere\tin  the\t  word\t may’\twere
\n\t      substituted.\n<\/p><\/blockquote>\n
\t      78<\/span><\/p>\n
\t      (3)   Notwithstanding  anything  contained  in
\n\t      the aforesaid Act, the Central Government may,
\n\t      by  order published in the  Official  Gazette,
\n\t      prohibit, restrict or impose conditions on the
\n\t      clearance, whether for home consumption or for
\n\t      shipment abroad of any goods or class of goods
\n\t      imported into India.”\n<\/p><\/blockquote>\n
\t      Under the powers conferred by this section the
\n\t      Central  Government issue the Exports  Control
\n\t      Order,  1958 (or shortly the  Control  Order),
\n\t      cl. 3 of which provided that “no person  shall
\n\t      export any goods of the description  specified
\n\t      in Sch.  I except under and in accordance with
\n\t      a licence granted by the Central Government or
\n\t      by   any\tofficer\t specified  in\tSch.\tII.”
\n\t      Manganese\t and iron ore were specified in\t the
\n\t      first  schedule.\tClause 6 of this order\tsets
\n\t      out the grounds upon which the Central Govern-
\n\t      ment  or the Chief Controller of\tExports\t and
\n\t      Imports  may  refuse  to grant  a\t licence  or
\n\t      direct  a licensing authority not to  grant  a
\n\t      licence.\t In  view of  certain  points  urged
\n\t      before  us it would be convenient to  set\t out
\n\t      this clause in full
\n\t      “6. Refusal of licence.-The Central Government
\n\t      or the Chief Controller of Imports and Exports
\n\t      may  refuse to grant a license or\t direct\t any
\n\t      other  licensing\tauthority  not\tto  grant  a
\n\t      licence\n<\/p><\/blockquote>\n
\t      (a)   if the application for the licence\tdoes
\n\t      not confers to any provision of this Order;\n<\/p><\/blockquote>\n
\t      (b)   if such application contains any  false,
\n\t      or fraudulent or misleading statement;\n<\/p><\/blockquote>\n
\t      (e)   if the applicant uses in support of\t the
\n\t      application  any\tdocument which is  false  or
\n\t      fabricated or which has been tempered with;\n<\/p><\/blockquote>\n
\t      (d)   if\tthe  applicant on any  occasion\t has
\n\t      tempered with an export licence or has
\n\t      79<\/span>
\n\t      exported\tgoods without a licence where it  is
\n\t      necessary, or has been a party to any  corrupt
\n\t      or  fraudulent  practice\tin  his\t  commercial
\n\t      dealings;\n<\/p><\/blockquote>\n
\t      (e)   if the application for an export licence
\n\t      is  defective  and  does not  conform  to\t the
\n\t      prescribed rules;\n<\/p><\/blockquote>\n
\t      (f)   if\tthe applicant commits a,  breach  of
\n\t      the Export Trade Control Regulations;\n<\/p><\/blockquote>\n
\t      (g)   if\tthe appellant is not eligible for  a
\n\t      licence  in accordance with the  Export  Trade
\n\t      Control Regulations;\n<\/p><\/blockquote>\n
\t      (h)   if\tthe licensing authority\t decides  to
\n\t      canalise\t  exports   through    special\t  or
\n\t      specialized agencies or channels;\n<\/p><\/blockquote>\n
\t      (i)   if\tthe  applicant\tis a  partner  in  a
\n\t      partnership  firm, or a director of a  private
\n\t      limited  company, which is for the time  being
\n\t      subject to any action under clause 8;\n<\/p><\/blockquote>\n
\t      (j)   if\tthe applicant is a partnership\tfirm
\n\t      or  a private limited company, any partner  or
\n\t      director\twhereof, as the case may be, is\t for
\n\t      the  time\t being subject to any  action  under
\n\t      clause 8.”\n<\/p><\/blockquote>\n
The  first restriction on the export of manganese  and\tiron
\nore was imposed in June, 1956 when the Ministry of  Commerce
\nand  Industry  issued  a public notice\ton  June  26,  1956,
\nsetting\t out their policy as regards export during the\thalf
\nyear  July  to\tDecember, 1956.\t  After\t reciting  that\t the
\ngovernment  were  convinced that the then  existing  trading
\nmechanism  as regards the export of ores was  inadequate  to
\ncode  with  the developments which had taken  place  in\t the
\npurchasing  countries,\tit went on to add that\tpersons\t who
\nentered into contracts
\n80<\/span>
\nwith  foreign  buyers  bad  been  unable  to  fulfil   their
\ncommitments which had caused inconvenience to foreign buyers
\nand so undermined the latter’s con   fidence in the capacity
\nof  this country to maintain\tan assured  line  of supply.
\nIn order, therefore, to overcome the obstacle in the way  of
\naugmenting  foreign  exchange earnings from  the  expert  of
\nthese ores, the Government declared that they would, help in
\nreorientating the trading in ores on more rational lines and
\nthat  for this purpose they proposed to canalise the  export
\nof  ores in a progressively increasing measure\tthrough\t the
\nState-\tTrading Corporation which would in its turn rely  on
\nthe  mining  interests in the country and use  the  existing
\ntrade  mechanism  to  the  extent  practicable.\t  For  these
\nreasons,  they announced that a regulation would take  place
\nof  the\t expert\t of these ores during the  half\t year  July-
\nDecember, .1956 through three classes of exporters:
\n(1)  Established shippers who would be granted export quotas
\non  the average of the quantities exported during the  years
\n1953, 1954 and 1955.\n<\/p>\n
(2)  Mineowners based on a annual average of the quantity of
\nore  on\t which royalty was paid during\tthe  calender  years
\n1953, 1954 and 1955, and
\n(3)  The  State Trading Corporation which would be  given  a
\nquota  on an ad hoc basis.  It is only necessary to  mention
\nthat  the State Trading Corporation which is  a\t Corporation
\nowned  and  controlled\tby the Union  Government  came\tinto
\nexistence by registration under the Indian Companies Act  in
\nMay, 1956.  Rail transport facilities co-extensive with\t the
\nquota  granted, were also assured for those to\twhom  quotas
\nwere  granted.\tThere were clarifications and  unsubstantial
\nvariations of this Press Note to which, however, it is riot
\n81<\/span>
\nnecessary  to refer as they are not material to\t the  points
\nnow in controversy.\n<\/p>\n
It  will be noticed that the control thus exercised and\t the
\nrestrictions  thus imposed, mineowners who had\tnot  entered
\nthe  field before 1953 were excluded from the grant  of\t any
\nexport\tquota.. By a public notice dated September 4,  1956,
\nthe  Ministry of Commerce, however, announced that the\tcase
\nof these “newcomers” was receiving their attention and\tthat
\nan announcement in that regard would be made in due course.
\nThe  same  policy  and\tthe same  basis\t of  allocation\t was
\ncontinued for the’ next half year January to June 1957.\t For
\nthe period July, 1957 to June, 1958, (the government  having
\nnow  started pursuing the policy of announcing their  quotas
\nfor  a\tyear instead of for six months), a  Press  Note\t was
\nissued\ton June 1, 1957, by which exporters  and  mineowners
\nwere  allotted a quota equivalent to 60 per cent  of  their
\nexports\t made in 1958 or 1956 to be selected by\t them.\t The
\nquota thus released was made available for being allotted to
\nthe  State  Trading Corporation on an ad hoc basis  and\t the
\nPress  Note  added: “The State Trading Corporation  will  be
\nallotted  in adequate quota to enable them to  maximise\t the
\nexports of manganese ore.  The Corporation are being advised
\nto  seek the co-operation of established trading and  mining
\ninterest  to  make  this effort\t a  success”.\tHere  again,
\ncertain\t unsubstantial\tmodifications were made\t by  further
\nPress Notes but to these we shall not refer.
\nAs  regards  the  next period July  1958  to  June  1959,the
\npolicy-decision of the government was indicated by a  Public
\nnotice issued on May 26, 1958.\tIn the course of this Press-
\nstatement the Government of India stated that they had\tbeen
\nkeeping under constant review the working of the
\n82<\/span>
\npolicy\tannounced by them under the Press Notes to which  we
\nhave  already  referred,  and  that they  bad  come  to\t the
\nconclusion that the long-term interests of Indian  Manganese
\nore  would  be better served if the export  policy  were  to
\ndiscourage  fragmentation of quotas and encourage bulk\tcon-
\ntracting, movement, and shipment of ores.  At the same time,
\nthe   Government  expressed  their  keenness   to   maintain
\ncontinuity   in\t the  export  arrangements  to\tthe   extent
\npracticable.   Having regard to these factors, they went  on
\nto state:\n<\/p>\n
\t      “Government  have decided that for the  period
\n\t      July   1958  to  June  1959,  the\t export\t  of
\n\t      manganese ore will be regulated as follows.\n<\/p><\/blockquote>\n
\t      (i)   The established shippers, the mineowner,
\n\t      exporters\t and’ the state Trading\t Corporation
\n\t      will  be\tgiven an allotment of  quota  for  a
\n\t      quantity equal to the quota for 1957-58.\n<\/p><\/blockquote>\n
\t      (ii)  Firms   and\t parties  whose\t  individual
\n\t      allotments  are small are advised to form\t Co-
\n\t      operative or limited companies.”\n<\/p><\/blockquote>\n
At the date when the writ petition out of which this  appeal
\narises was filed, the polioy-statement of May 26, 1958,\t was
\nin  force  and it was the validity of  the  restriction\t and
\ncontrol\t  exercised   by   it\tthat   was   challenged\t  as
\nunconstitutional  in  the petition filed by  the  appellant.
\nThe position at that date may be summarised as follows:
\n(1)  From and after July 1956 the export of manganese  ore
\nhad been controlled or restricted.\n<\/p>\n
(2)  The  restriction  had taken the form  of  allotment  of
\nquotas\tfor  export granted to: (a)  established  exporters,
\ni.e., comprising the category of these who had exported from
\n1953 onwards , (b)  mine-owners\t who had similarly  exported
\nthe
\n\t\t\t     83<\/span>
\nore  won  by them with a similar limitation as to  the\tyear
\nwhen  they should have exported, and (c) The  State  Trading
\nCorporation  which was granted an export quota on an ad\t hoc
\nbasis to cover every other quantity which could be  exported
\nand for which a foreign market could be found.\tTraders\t and
\nmine-owners  who  had not any export  performance  to  their
\ncredit\tin earlier years were excluded from the\t scheme\t and
\nthough\tthe  government\t were repeatedly  stating  in  their
\npublic\tstatements  that the case of  these  persons  termed
\n“newcomers”  would be considered, this had never been  done.
\nThe  appellant\tfell within the last category  and  was\t not
\neligible to any export quota and therefore could not export.
\nThe result was that the ore won by him had either to be sold\n<\/p>\n
(a)  in the internal market which, as stated earlier, was  a
\nvery  restricted  one,\tthis  because  the  steel  producing
\nconcerns  which were the principal or practically  the\tonly
\nconsumers of the ore in the country bad their own mines from
\nwhich  the  ore\t required by them was won, and\t(b)  in\t the
\nabsence\t of an internal market the mined ore had to be\tsold
\neither\tto  established\t shippers or to\t the  State  Trading
\nCorporation.   In  regard , to established  shippers,  their
\nquota  of  export was being progressively reduced,  so\tthat
\ntheir  demand  for ore naturally shrank\t and  unremunerative
\nprice  had  therefore to be offered by\tthe  “newcomers”  to
\ninduce\tthem to buy.  The only other possible buyer was\t the
\nState Trading Corporation which was being granted quotas  on
\nan ad hoc basis sufficient to enable it to get all the\tgood
\nore  which it might buy for which there might be  a  foreign
\nbuyer.\t In regard to the State Trading\t Corporation,  there
\nwas  an allegation made by the appellant, by reference to  a
\ncircular  issued by the Corporation on April 20, 1957,\tthat
\nthe terms offered for the purchase of ore were unfair to the
\nsellers\t because  of  the excessively  large  commission  it
\ndemanded.  It should, however, be
\n84<\/span>
\nstated that the State Trading Corporation was not  impleaded
\nas  a party in the writ petition in the High Court, nor\t any
\nrelief\tsought\ton  the\t basis\tof   that  allegation.\t The
\ncircumstance was relied on merely to emphasise the  hardship
\ncaused to the appellant from the exclusion of those who\t had
\nno  expert performance in the years which were fixed as\t the
\nbasic  years  for  the\tallotment  of  an  export  quota  to
\nmineowners.   The State Trading Corporation being owned\t and
\ncontrolled  by,\t the  Central Government  is  an  agency  or
\ninstrument  of\tgovernment for effectuating  its  commercial
\npolicy.\t If in the performance of its duties as such  public
\nauthority it acts in any improper or unfair manner it  would
\nbe  subject  to the control of the Courts but as  no  relief
\nbased  on such a complaint was claimed by the appellant,  it
\nis not necessary to pursue the point or examine its merits.
\nThe  case of the appellant has to be judged on the basis  of
\ntwo  admitted features resulting from the policy  statements
\nof Government we have set out earlier : (1) That  mineowners
\nwho  were “newcomers”, i. e., not having export\t performance
\nin   certain   basic  years,  were  excluded   from   direct
\nparticipation in the export trade, but these persons had, in
\nview  of  the practical absence of an  internal\t market\t for
\nmanganese  ore to sell their goods to others. who  had\tbeen
\ngranted\t facility  for\texport. (2)  That  the\tcategory  of
\npersons\t to  whom  they could sell their ore  were  two\t (a)
\nEstablished shippers, and (b) The State Trading Corporation,
\nand with the nature of this market as already described.
\nThe  question  raised  for consideration by  the  appeal  is
\nwhether\t the  withholding of the right to engage  in  export
\ntrade\tfrom  this  class  of  mineowners   constitutes\t  an
\nunreasonable restriction on their right to carry on business
\nguaranteed by Art. 19 (1) (g) of the Constitution.\n<\/p>\n
85<\/span><\/p>\n
Pausing\t here we might put aside one matter which is  beyond
\nthe pale of controversy, and that is that the constitutional
\nvalidity of s. 3 of the Imports & Exports Control Act, 1947,
\nwhich  forms  as it were the ultimate root  from  which\t the
\nimpugned  notifications\t and  executive\t actions  spring  is
\nconceded.   The\t points\t urged by learned  Counsel  for\t the
\nappellant  were\t two : (1) Clause 6 (b) of  Exports  Control
\nOrder  1958, was beyond the rulemaking power under s.  3  of
\nthe  Imports & Export Control Act, 1947, (2) Even if  el.  6\n<\/p>\n
(h)  and  the “canalising” of exports through  “special”  or
\n“specialised”  agencies or channels be valid, the  notifica-
\ntions by which the canalisation was effected are outside the
\ncontemplation of the ‘agency or channel’ under el. 6 (h).
\nBefore\tproceeding further it is necessary to  mention\tthat
\nthe  constitutional  validity  of el. d (h)  of\t the  Export
\nControl\t  Order\t 1953  was  not\t disputed  before  us,\t the
\ncontroversy  in relation to it having been concluded by\t the
\ndecision by this Court in Glass Chatons Importers and  Users
\nAssociation v. Union of India<\/a> (1).  The argument in  support
\nof the contention that el. 6 (h) was beyond the terms of  s.
\n3 of the Act was briefly this : Section 3 of the Act by\t its
\nlanguage,  its setting and context permits  restrictions  or
\ncontrols  only\tin regard to goods which  are  the  subject-
\nmatter\tof  export and does not\t permit\t restrictions  being
\nimposed\t on persons engaged in the export trade.   In  other
\nwords, the Central Government is enabled by a notified order
\nunder s. 3 of the Act (a) to specify the goods in respect of
\nwhich  the control or restriction is to be exercised,  along
\nwith  (b) a matter which this necessarily  involves,  ‘viz.,
\nthe quantities that may be exported, (e) the quality of\t the
\ngoods that might pass out of the country and (d) as  regards
\nthe  destination to which they might be exported.   But\t the
\nrestrictions could not extend any further.  An
\n(1)  A.I.R. 1961 IS.C, 1514.\n<\/p>\n
86<\/span><\/p>\n
order  under  s. 3 cannot make\tprovisions  restricting\t the
\npersons\t who  might participate in  export  trade,  restrict
\neither their number or impose qualifications which they must
\nsatisfy before being permitted to export.  Besides, even  if
\na  notified  order might validly prescribe the\tpersons\t who
\nmight  participate  in the export trade, still\tit  did\t not
\nauthorise  an order which would so canalise or\tchannel\t the
\npersons who might engage in the export trade as\t practically
\nto  create a monopoly in favour of any particular person  or
\ngroup which is what r. 6 (h) has effected.\n<\/p>\n
The  argument  was  put\t in a  slightly\t different  form  by
\nreference to the provisions of Art. 19 (6).  Article 19\t (1)\n<\/p>\n
(g),  after guaranteeing to all citizens the right to  carry
\non any occupation, trade or business, had gone on to provide
\nin  cl. (6) the restrictions which may\tconstitutionally  be
\nimposed\t on the right thus guaranteed, and the clause as  it
\nnow  stands  after the first Amendment of  the\tConstitution
\nreads. to quote the material words :\n<\/p>\n
\t      “Nothing in sub-clause (g) of the said  clause
\n\t      shall affect the operation of any existing law
\n\t      in so far as it imposes, or prevent the  State
\n\t      from making any law imposing, in the interests
\n\t      of the general public, reasonable restrictions
\n\t      on the exercise of the right conferred by\t the
\n\t      said  sub-clause, and, in particular,  nothing
\n\t      in  the  said  sub-clause\t shall\taffect\t the
\n\t      operation of any existing law in so far as  it
\n\t      relates  to, or prevent the State from  making
\n\t      any law relating to,-\n<\/p><\/blockquote>\n
\t      (i)\n<\/p><\/blockquote>\n
\t      (ii)  the\t carrying  on by the  State,  or  by
\n\t      corporation owned or controlled by the  State,
\n\t      of any trade, business,. industry or  service,
\n\t      whether to the exclusion, complete or partial,
\n\t      of citizens or otherwise”.\n<\/p><\/blockquote>\n
 87<\/span><\/p>\n
The  effect of the policy statements and directions  to\t the
\nlicensing  authorities\tissued\tby  virtue  of\tthe   powers
\nconferred by el. 6 (h) of the Export Control Order 1958\t had
\nresulted in the creation of a monopoly or a near monopoly in
\nfavour of the State Trading Corporation.  It was urged\tthat
\nthe  creation  of such a monopoly could on the\tlanguage  of
\nArt. 19 (6) (ii) be effected only by the State making a\t law
\nin  relation  to  the matters there set\t out.\tNeither\t the
\nExport\t&  Import Control Act, 1947 nor\t even  the  notified
\norder made there under-The Export Control Order, 1958  could
\nbe  said  to be “‘a law relating to the carrying on  by\t the
\nState  of  any\ttrade, business, industry  or  service”\t and
\ntherefore the validity of the preferential treatment granted
\nto  the State Trading Corporation could not be justified  or
\nupheld by reference to the amendment effected to el. (16) by
\nthe Constitution (First Amendment) Act, 1961.  So much could
\nbe  accepted.  But this, however, leaves  for  consideration
\nthe question whether the provision now impugned could not be
\nsustained  as “a reasonable restriction” on the exercise  of
\nthe  rights conferred by sub-cl. (g) of Art. 19 (1)  in\t the
\ninterest  of the general public i. e., on the opening  words
\nof  para  1  of cl. (6).  But as pointed  out  already,\t the
\nconstitutional\t‘validity  of  el. 6 (h) in  so\t far  as  it
\npermits the canalising or channelling of the export trade is
\nno longer res integral this having been upheld in the  Glass
\nChatons case (1).\n<\/p>\n
In   the  circumstances,  the  very  narrow   question\t for
\nconsideration,\tis whether the restrictions and control\t for
\nwhich  provision might be made by s. 3 would not  include  a
\nprovision  for\tcanalising  the\t trade\tin  any\t  particular
\ncommodity.    We  are  clearly\tof  the\t opinion  that\t the
\nrestriction  or\t control  in  the  form\t of  channelling  or
\nCanalising  the trade is not outside the  limitations  which
\nmight be imposed on
\n(1)  A.I.R. 1961 S.C. 1514,
\n88<\/span>
\nexport trading by s. 3 and that consequently el. 6(h) in its
\npresent\t form is within the rule-making power  conferred  on
\nthe  Central  Government by s. 3 of the Act.   The  argument
\nthat the restrictions which could be imposed or the  control
\nwhich might be exercised on exports by orders made under  s.
\n3  of the Act, could not extend to restrictions\t on  persons
\nwho  might  be permitted to engage in the export  trade\t has
\nonly  to  be  stated.  If the quantum of  the  export  in  a
\ncommodity  could  be  restricted,  the\tcontrol\t that  would
\neffectuate  this  must\tnecessarily extend  to\tthe  persons
\nengaged\t in  or desirous of engaging in the export  of\tthat
\ncommodity   and\t this  would  a\t fortiori  be  so,  if\t the
\nrestriction takes the form of a prohibition of exports in  a
\ncommodity   altogether.\t  If  therefore the   control\tor
\nrestriction  could  legally extend to the  persons  who\t are
\nengaged in the trade; it would appear to follow as a logical
\nstep that the restriction might take the form of classifying
\nthe  persons  who  might participate in the  trade  and\t the
\nconditions  subject to which any particular class  might  be
\npermitted to do so.  It would be a matter of policy for\t the
\nGovernment to determine, having regard to the nature of\t the
\ncommodity and the circumstances, attending the export  trade
\nin it, to lay down the basis for the classification  between
\ngroups and fix their relative priorities etc.  When el. 6(h)
\npermits “canalising” or the “channelling” of exports through
\nselected  agencies it does not no more than  make  provision
\nfor the classification into groups etc. which but one of the
\nmodes  which  the  “control” under a. 3\t of  the  Act  might
\nassume.\n<\/p>\n
The next point to be considered is whether the notifications
\nissued\tby which (1) the export trading in manganese ore  is
\nconfined  to three groups of persons engaged in\t the  trade,
\nviz., (a) established shippers, (b) mine-owners, and (e) the
\nState  Trading\tCorporation, the two former  being  allotted
\nquotas
\n\t\t\t     89<\/span>
\nbased upon the export effected by them during certain  basic
\nyears, (2) the progressive reduction in the quota of  groups\n<\/p>\n
(a)  &\t(b)  with  a view to  enable  the  available  export
\nbusiness to be handled by the State Trading Corporation, and
\n(3) as a necessary result of the above the elimination\tfrom
\nthe  export trade of the class known in the trade  as  “new-
\ncomers”\t was permitted under el. 6(h) of the export  Control
\nOrder, 1958.  It would be seen from the above that there are
\ntwo grievances of the appellant which are inter-related: (1)
\nThe  first  consists in the complaint  regarding  the  quota
\nallowed\t to the established shippers and mineowners who\t had
\nan export performance during a basic year.  Learned  Counsel
\nhowever,  did not put this forward as any serious  grievance
\nbecause\t persons falling within those already in  the  trade
\nand  the appellant who wants to come into the  export  trade
\ncould  not legitimately object to those already in it  being
\nallowed\t facilities or licences for effecting  exports.\t  In
\nhis  petition before the High Court the appellant  raised  a
\ncomplaint that the basic years fixed in the policy statement
\nwere arbitrary but the fixation of any year must be so,\t and
\nif  the\t Government fixed as a basic year, a  period three
\nyears before the announcement of the policy, i.e., took into
\naccount\t performance within a period of three  years  before
\nthat   date,   we  do  not  see\t any   unreasonableness\t  or
\narbitrariness  about  it.  (2)\tIt  was\t in  regard  to\t the
\ninclusion  of  the  State Trading  Corporation\tamong  those
\nentitled  to export and the increasing quota given to it  on
\nan  ad\thoc  basis  without  reference\tto  any\t  antecedent
\nperformance  that  the main attack was directed and  it\t was
\nthis  that  learned Counsel stated amounted  to\t a  monopoly
\nwhich was not countenanced by the law.\tIt will therefore be
\nsufficient  for us to confine attention to the grounds\tupon
\nwhich the successive notifications which afforded increasing
\nfacilities to the State Trading Corporation for export\twere
\nchallenged.\n<\/p>\n
90<\/span><\/p>\n
Pausing\t here  it  would be convenient if  we  set  out\t the
\nreasons\t why according to the respondent the  State  Trading
\nCorporation   was  preferred  as  a  principal\tagency\t for
\ncanalising  the export trade in\t this commodity.  The  vital
\nnecessity of export earnings for sustaining national economy
\nnot  being a matter of controversy, the question  which\t the
\ngovernment  had\t to  consider was how  best  to\t ensure\t the
\noptimum earning from exports of manganese ore.\tIndia has no
\nmonopoly in the production of this ore and consequently\t the
\nprice of the commodity in the foreign market is dependent on
\nworld-wide  factors.  Having regard to the use to which\t the
\nore is capable of being put, viz., by steel factories in the
\nproduction  of steel, the foreign buyers, (and in  this\t one
\nfactor\tto be taken into account is that in several  foreign
\ncountries   external  trade  is\t conducted   through   State
\nagencies),  are\t insistent  that there shall  be  a  regular
\nsupply of ore of uniform quality.  There had been complaints
\nin  early  years,  when\t the  trade  in\t the  commodity\t was
\nunrestricted and not under any control, that the quality  of
\nthe  ore  supplied  was not according to  sample,  with\t the
\nresult\tthat  even  the trade of those\twho  took  pains  to
\nmaintain  their\t quality of supplies suffered.\t It  was  in
\nthese  circumstances  that  government stepped\tin  1956  by
\nimposing restrictions and by assuring the foreign buyers  of
\na  regular  supply  through the mechanism  of  the  controls
\nexercised in this country.  These facts were not disputed.
\nIt  is\twith  this  background that  the  challenge  to\t the
\nvalidity  of  the  notification has  to\t be  considered\t and
\nanswered.   The\t imposition  of\t any  restriction  on  those
\nentitled to engage in any trade would necessarily mean\tthat
\nthose who do not conform to the criteria laid down would  be
\ndenied\tthe  right to participate in that  trade;  and\tthis
\nwould be a fortiori so if the restriction takes the form of
\n91<\/span>
\ncanalising  of\tthe  trade in a\t commodity,  for  canalising
\nnecessarily  implies  the  exclusion  of  some\tgroups.\t  If
\ntherefore  s.  3 of the Act permits a rule to  be  made\t for
\ncanalising  export trade in a commodity and such  canalising
\nis not unconstitutional, it would necessarily follow that  a
\nperson\tcannot have a legally sustainable complaint that  he
\nis eliminated from among the groups entitled to\t participate
\nin the trade.  The question whether the canalising has\tbeen
\nproperly  done in the sense that the groups selected are  no
\nbetter\tthan  the groups eliminated poses a  very  different
\nproblem,   and\tif  that  were\tmade  out  a   question\t  of
\ndiscrimination might conceivably arise.\t We should, however,
\nhasten to point out that it is not the case of the appellant
\nthat  the  established shippers and the mineowners  to\twhom
\nquotas\thave been allotted,in addition to the State  Trading
\nCorporation  have been improperly included in the  group  of
\npersons\t entitled  to participate in the export\t trade,\t and
\nthat   apart,\tthere  is  a  rational\t and   very   proper
\nclassification\tbetween\t those who have\t experience  in\t the
\ntrade and the newcomers who do not possess these experience.
\nIn  other  commodities concerned in export or  import,\tnew-
\ncomers i.e., those with no previous experience in the export
\nline but who have experience in other branches of the trade,
\nhave  been allotted quotas, though this should\tdepend\tupon
\nthe circumstances of each trade.  It has not been  suggested
\nthat previous experience in the export trade would not be  a
\nvaluable qualification for the grant to a person or group of
\na  quota, and even a preferential quota in the export  trade
\nin the commodity with which we are now concerned.  It  Would
\nthus  appear  that  if the notifications  had  confined\t the
\nentire\texport trade to those with previous  experience,  no
\nlegal  objection could have been taken to the  notifications
\non  the arguments addressed to us by learned.\tCounsel\t for
\nthe  appellant.\t  In  such  a  state  of  circumstances\t the
\nappellant would have been excluded but
\n92<\/span>
\nhe could not still complain that he was illegally eliminated
\nbecause\t  this\texclusion  was\tnecessary   consequence\t  of
\nchannelling  or\t canalising of the exports  through  persons
\nwith previous experience in the field.\n<\/p>\n
The  real grievance of the appellant was that in  preference
\nto  him and those like him, who win the ore to be  exported,
\nthe   State  Trading  Corporation  which  had  Do   previous
\nexperience of the export trade should have been selected  as
\nthe  agency for canalising exports.  There is no doubt\tthat
\nif the only test of differentiation was previous experience,
\nthe  preference\t of  the State Trading\tCorporation  to\t the
\nappellant  and the others of the class to which he  belongs,
\nmight  not  be justified, but that is not the sole  test  by
\nwhich the matter has to be judged.  We have set out  earlier
\nthe   grounds  upon  which  choice  of\tthe  State   Trading
\nCorporation as the agency for effecting the export trade was
\ndetermined by the government and we consider that for  those
\nreasons\t there was nothing improper in the choice, but\tthat
\non the other hand the object of the export trade, viz.,\t the
\nearning of foreign exchange to the maximum with benefit of a
\nlong range character for exports from this country could  be
\nexpected  to be attained with the State Trading\t Corporation
\nas  the\t main  agency  engaged in  the\ttrade.\t We  do\t not
\ntherefore  consider  that  there is  any  substance  in\t the
\nargument  of the learned Counsel for the appellant that\t the
\nchoice of the State Trading Corporation and the granting  to
\nit if quotas on an ad hoe basis was either beyond the powers
\nconferred  upon the licensing authorities under cl. 6(h)  of
\nthe Export Control Order or was otherwise open to objection.
\nThere\twas  one  other\t matter\t that  was  urged  in\tthis
\ncconnection to which it is necessary to refer.\tClause\t6(h)
\nenables the licensing authorities to canalise exports
\n93<\/span>
\n“through special or specialised agencies, or channels”.\t  It
\nwas  urged that the State Trading Corporation was neither  a
\nspecial\t nor specialised agency or channel and that on\tthat
\nground the choice of the corporation was outside 6 (h).\t  We
\nare  wholly  unable to accept this argument.   Whatever\t the
\nterm  “specialised” might mean, the word “special”  can\t not
\nbear  the construction that it must be, an expert agency  in
\nthat line, in the sense that it possesses a type of previous
\nexperience which cannot be claimed by others.  Without going
\nso far as to say that a special agency or channel might mean
\nmerely\ta designated agency, it would be proper to  construe
\nthe  word as meaning, an agency selected having in view\t the
\npurpose\t for which the channeling or canalising has to\ttake
\nplace.\t In  other words, an agency would  be  “special’  if
\nhaving regard to the purpose for which the canalising  takes
\nplace it is more likely to achieve that objective than other
\nagencies or achieve it in a larger measure than others.\t  In
\nthat  sense we have no hesitation in holding that the  State
\nTrading,  Corporation  might  be a  “special”  agency  or  a
\nchannel for the purpose of enabling the country to  maintain
\nand  foster the continuity of its trade in the commodity  by
\nensuring exports in adequate quantity and of proper quality.
\nIn this state of circumstances the elimination of the  class
\nto  which the appellant belongs, viz., newcomers who had  no
\nprevious  experience  of the export trade during  the  basic
\nyear  or  earlier was the result of  enforcing\ta  permitted
\nmethod\tof  control and a type of restriction which  it\t was
\nlegally competent to be imposed under 6 (h).  In the case of
\nother  commodities, “newcomers” have been granted  a  quota.
\nThat  however  naturally  depended upon the  nature  of\t the
\ntrade,\tthe  nature of the export market and  other  factors
\nwhich it is the province of government to take into account.
\nHaving stated this legal position, we would hasten to
\n94<\/span>
\n add  that  it was not the view of the Government  that\t the
\nexport\ttrade  in  manganese ore was such  into\t that\tthat
\nnewcomers could never be permitted  trade is clear from\t the
\nseveral, policy-statements   themselves in which, from\ttime
\nto,  time, they conveyed an assurance that the allotment  of
\nquotas\tto the “newcomers” was under consideration.  In\t the
\ncase  of a commodity like manganese ore for which  there  is
\nnot much of an internal market the denial of a right to\t any
\ngroup or we shall add, to any individual to export would  in
\neffect\taffect him adversely forcing him to sell  to  others
\nwho have been given such a facility.  Persons like the\tapp-
\nellant were being fed on hopes of some relief to them and it
\nwas  a\tcase not merely of hope deferrer  making  the  heart
\nsick,  but  of\tdashed\thopes  that  led  the  appellant  to
\napproach. the Court for relief.\t Though we consider that the
\nappellant  has no legal right to the relief that he  sought,
\nhis grievance is genuine and it would be for the  Government
\nto  consider how beat the interest of this class  should  be
\nprotected and it is made worth their while to win the ore so
\nas  to expand, foster and augment the export trade  in\tthis
\nvaluable commodity.\n<\/p>\n
Reverting  to  the  legal points raised in  the\t appeal,  it
\nappears\t cleat to us that on the premises (1) that s.  3  of
\nthe  Import & Export Control Act, 1947 is a valid  piece  of
\nlegislation, (2) that cl. 6 (h) of the Export Control  Order
\nis within the rulemaking power of the Central Government and
\nis  constitutional, there is no escape from  the  conclusion
\nthat no legally enforceable right of the appellant has\tbeen
\nviolated for which he could seek redress; under Art. 226  of
\nthe Constitution.\n<\/p>\n
in  this  view\tit is unnecessary to  consider\twhether\t the
\nappellant having prayed primarily for the issue of a writ of
\nmandamus to direct the licensing authorities to consider his
\napplication for
\n\t\t\t     95<\/span>
\nan  export licence for the half year current at the date  of
\nthe  petition  ‘,without  reference  to\t the  terms  of\t the
\nimpugned  notifications and policy statement” and that\thalf
\nyear having long ago gone by, he could be granted any relief
\nby  the High Court on his petition or by this Court  on\t his
\nappeal.\t It is possible that in such circumstances a  person
\nsituated   like\t the  appellant\t might\tbe  entitled  to   a
\ndeclaration  as\t regards the validity  of  the\trestrictions
\nimposed\t which continue to be in force even beyond the\thalf
\nyear  or year to which the licence relates.  It\t is  however
\nunnecessary to pronounce upon this question which does\tnot
\nreally\tarise  for consideration in view of  the  conclusion
\nthat  we have reached that the restrictions and\t control  to
\nwhich  the trade has been subjected are legal and  justified
\nby the Act and the Rules framed there under.
\nThe result is that the appeal fails and is dismissed.  There
\nwill, however, be no order as to costs.\n<\/p>\n
SUBBA RAO, J.This appeal by certificate is directed  against
\nthe  judgment  of  a division Bench of\tthe  High  Court  of
\nJudicature   for  Bombay,  Nagpur  Bench,   dismissing\t the
\napplication  filed  by the appellant under Art. 226  of\t the
\nConstitution  praying for the issue of an  appropriate\twrit
\n‘directing  the first respondent to grant an export  licence
\nin his favour.\n<\/p>\n
The facts giving rise to this appeal may be briefly  stated.
\nThe  appellant is the lessee of manganese mines situated  in
\nthe State of Madhya Pradesh.  He carries on the business  of
\nmining\tand  selling  the ore raised  therefrom.   There  is
\npractically  no internal market for manganese, and  most  of
\nthe  manganese\tproduced  in India is  exported\t to  foreign
\ncountries.   The internal trade in regard to  manganese\t ore
\nbeing negligible, it may be ignored
\n96<\/span>
\nfor  the  purpose of this case.\t Till about  the  middle  of
\n1956,  miners,\tincluding the appellant, were free  to\tdeal
\nwith foreign buyers for exporting their products and to sell
\nthem  at their sidings to exporters or to carry them to\t any
\nport  by  obtaining  necessary\twagon  allotments  from\t the
\nrailways.  But from May 1956, the Government of India issued
\nvarious\t notifications progressively restricting the  export
\nquotas\t available   to\t the   shippers\t  and\tmine-owners,
\nculminating in a stage when direct export by mineowners\t and
\nshippers  was stopped and the entirtrade  canalized  through
\nthe  State  Trading  Corporation originally  formed  by\t the
\nGovernment  as a private company under the  India  Companies
\nAct,  1956 and subsequently made into a public\tcompany,  We
\nshall  later on consider in detail the particulars.  of\t the
\nsaid  process.\tOn December 1, 1958, the appellant filed  an
\napplication before the Joint Chief Controller of Imports and
\nExports, the first respondent herein, for granting to him an
\nexport\tquota and licence for export of manganese ore  under
\ncl.(4)\tof the Exports (Control) Orders, 1958,\t(hereinafter
\ncalled the Order), and also for the movement of the ore from
\nthe  railway sidings to Bombay port.  The first\t respondent,
\nby his reply dated December 17, 1958, refused to comply with
\nthe said request on the ground that export of manganese\t ore
\noutside\t India was only allowed by established shippers\t and
\nestablished  mine-owners according to the “existing”  orders
\nof  the\t Government.   Aggrieved  by  the  said\t order,\t the
\nappellant filed the said writ petition before the High Court
\nof  Bombay,  but  that was  dismissed.\t Hence\tthe  present
\nappeal.\t  The Joint Chief Controller of Imports and  Exports
\nis  made  the first respondent and the Union of\t India,\t the
\nsecond respondent to the appeal.\n<\/p>\n
The  argument  of learned counsel for the appellant  may  be
\nsummarized thus: Under Art.19(1)(g) of the Constitution\t the
\nappellant had a right to
\n\t\t\t     97<\/span>
\ncarry  on his business of producing and selling man.  ganese
\nore and exporting it to foreign countries either directly or
\nthrough\t exporters.   The policy statements  issued  by\t the
\nGovernment  from  time to time, on the basis  of  which\t his
\napplication  was rejected, crippled the trade of the  miners
\nlike.  the  appellants, who were newcomers in the  field  of
\ndirect export.\tClause (6) of the Order, whereunder the said
\npolicy\tstatements  were  issued  and  which  empowered\t the
\nCentral ‘Government of the Chief ‘Controller of Imports\t and
\nExports\t to canalize exPorts through special or\t specialised
\nagencies or channels, is ultra vires inasmuch as s. 3 of the
\nImports\t and  Exports (Control) Act, 1947 (XVIII  of  1947),
\nhereinafter  called the Act, whereunder the said  order\t was
\nmade,  does not empower the Central Government to  take\t for
\nitself\tor confer on others such a power.  Even if cl.\t6(h)
\nof  the\t Order\twas  valid, the\t said  order  empowers\tonly
\nequalizing exports through special or specialized  agencies,
\nthat is, through experts in the line of export business, and
\nit  cannot be relied upon to canalize the  business  through
\nthe  State  Trading Corporation, which is in no\t way  better
\nthan  the businessmen in that line and which indeed has\t not
\nget  any  experience in the business of export\tcompared  to
\nother  experienced  exporters.\tIn any\tview,  the  ultimate
\neffect\tof the policy statements is to create a monopoly  in
\nthe export trade in manganese in favour of the State Trading
\nCorporation  and  other qualified exporters,  and  later  on
\nsolely\tin  favour of the said Corporation, without  at\t the
\nsame  time  safeguarding the interests of  miners  like\t the
\nappellant  by fixing appropriate quotas or  otherwise:\twith
\nthe result, they are compelled either not to do the business
\nat all or put themselves at the mercy of others, who ,are in
\na  position to dictate terms and who may or not buy the\t ore
\nfrom  them.   The  implementation  of  the  policy  to\t the
\ndetriment  of miners like the appellant is  an\tunreasonable
\nrestriction on their
\n98<\/span>
\nright  to  carry  on their business in\tmining\tand  selling
\nmanganese ore.\n<\/p>\n
Learned\t counsel  for  the respondents\tContended  that\t the
\npetition  filed\t by  the appellant under  Art.\t226  of\t the
\nConstitution  should be dismissed on the ground that it\t has
\nbecome\tinfructuous, as the year for which the\tlicence\t was
\nasked, namely, 1959, had run out.  The learned counsel\talso
\nsought to support the order made by the first respondent  on
\nground\tthat el.( 6) of the Order was validly made and\tthat
\nthe  scheme of implementation of the policy  adumberated  by
\nthe  Government was not only sanctioned by el. 6(h)  of\t the
\nOrder, but the restriction imposed on the fundamental  right
\nof the petitioner was also a reasonable one.
\nThe  first  question is whether el. 6(h) of  the  Order\t was
\nultra  vires  the  Act.\t  The  relevant\t provisions  may  be
\nnoticed.  The meterial part of a. 3 of the Act reads:\n<\/p>\n
\t      “Powers  to prohibit or restrict\timports\t and
\n\t      exports.-\n<\/p><\/blockquote>\n
\t      (1)   The\t Central  Government may,  by  order
\n\t      published\t  in  the  Official  Gazette,\tmake
\n\t      provisions  for  prohibiting,  restricting  or
\n\t      otherwise\t  controlling,\tin  all\t  cases\t  of
\n\t      specified\t classes  of oases, and\t subject  to
\n\t      such  exceptions if any, as may be made by  or
\n\t      under the order:-\n<\/p><\/blockquote>\n
\t      (a)   the\t import, export, carriage  coastwise
\n\t      or  shipment as ships stores of goods  of\t any
\n\t      specified description.\n<\/p><\/blockquote>\n
\t      x\t\t  x\t     x\t\t x
\n\t      Clause (6) of the Order reads:\n<\/p><\/blockquote>\n
\t      “Refusal of licence.-The Central Government or
\n\t      the Chief Controller of Imports and
\n\t\t\t\t    99<\/span>
\n\t      Exports  may  refuse  to grant  a\t licence  or
\n\t      direct  any other licensing authority  not  to
\n\t      grant a licences\t   :-\n<\/p><\/blockquote>\n
\t      x\t    x\t     x x\tx x\n<\/p><\/blockquote>\n
\t      (h)   if\tthe licensing authority\t decided  to
\n\t      canalize\t exports   and\t the\tdistribution
\n\t      thereof\tthrough\t  special   or\t specialized
\n\t      agencies or channels.\n<\/p><\/blockquote>\n
The  Order was made in exercise of the powers  conferred  by
\nss.3 and 4-A of the Act.  It is contended that s. 3 does not
\nempower the Central Government to issue an order  conferring
\non  itself  or another a power to canalize  exports  through
\nspecial\t or specialized agencies or channels.  There  is  no
\nforce  in this argument.  Section 3 of the Act empowers\t the
\nCentral\t Government  to make provisions\t for  prohibibiting,
\nrestricting  or\t otherwise controlling in all  cases  or  in
\nspecified  classes of cases the export of goods.  The  power
\nconferred  is very wide and it is not possible to hold\tthat
\ncanalizing  exports through special or specialized  agencies
\nor   channels  is  not\tcomprehended  by  the  said   words.
\nCanalizing exports through specialized agencies or  channels
\nis one way of controlling export.  It is contended that\t the
\nincidence of the section is only at the point of exportation
\nand that the said section does not authorize the  conferment
\nof a power to regulate internal trade with a view to control
\nexports.  This is putting a very narrow construction on\t the
\nwording of section 3 of the Act.  It is true that the  Cent-
\nral  Government cannot interfere with internal\ttrade  under
\nthe colour of regulating export, but the power to  prohibit,
\nrestrict  or  control exports of goods carries with  it,  by
\nimplication, the power to do all things intimately connected
\nwith  the  regulation  of export trade.\t If  the  power\t was
\nconfined  only\tto  the export point, it  would\t defeat\t the
\npurpose\t of the Act.  The main object of  regulating  export
\ntrade in to assist the national economy.  This
\n100<\/span>
\nobject\tcan be achieved only by devising ways and  means  to
\npromote export and to secure favourable balance of trade.  A
\nmachinery will have to be evolved to select the goods  which
\nthe country can spare or may prefer to exchange for more
\nessential  foreign goods, to find suitable  foreign  markets
\nfor  them  and,\t to  take necessary  steps  to\testablish  a
\nreputation   for  Indian  goods\t by   securing\t qualitative
\nstandards,  prompt  deliveries and honest dealings,  and  to
\nprevent\t  avoidable   hardships\t by  allotting\t quotas\t  to
\nbusinessmen or equitable principles, to fix reasonable rates
\nfor their goods and to discharge similar other duties.\tThis
\ncannot be achieved if the control of the Central  Government
\nis  confined only to the exportation point.  The  regulation
\nof the export trade may have to commence even at an  earlier
\nstage  ; in extreme cases even at the stage  of\t production.
\nIt  is\tquestion of fact in each  case,whether\tthe  control
\nexercised  by  the Central Government is  only\tto  regulate
\nexport trade or is a colourable exercise of controlling\t the
\ninternal  trade under the guise of regulating export  trade.
\nI therefore, hold that the power conferred under a. 3 of the
\nAct  cannot be conferred on the authorities concerned  under
\nol. 6(h) of the Order to canalize exports through special or
\nspecialized  agencies or channels is well within  the  scope of the power
\nconferred on the Central Government.\n<\/p>\n
In this context another arguments of learned counsel for the
\nappellant  may conveniently be dispose of.  It is said\tthat
\nthe special or specialized agencies or channels mean  export
\nagencies  or channels.\tThe dictionary meaning of  the\tword
\n“special” is “for a particular purpose” and “specialise”  is
\n“set apart for a particular purpose.” The said words do\t not
\nnecessarily  convey the idea that the agency created  for  a
\nspecial\t purpose should be experts in the line with  certain
\nqualifications.\t  While\t the Government may be\texpected  to
\nselect
\n\t\t\t    101<\/span>
\nsuitable  agency well versed in export trade of\t particular
\ncommodities  for achieving maximum results, the\t wording  of
\nthe clause does not impose any such qualifications.  In this
\nview,  it  is  not necessary to express my  opinion  on\t the
\nquestion  whether  the State ‘trading Corporation  is  in  a
\nbetter\tposition  or  is  a  more  qualified  one  than\t the
\nexperienced  exporters\tin the line of export  of  manganese
\nore, for the selection of the agency is within the exclusive
\nprovince of the Government.\n<\/p>\n
Even  so, it is contended that the scheme, as  progressively
\nunfurled   by  the  Government\tin  the\t shape\t of   policy
\nstatements, infringes the fundamental right of the appellant
\nand  persons similarly situated under Art. 10(1)(g)  of\t the
\nConstitution.  To apppreciate this argument it is  necessary
\nto  notice briefly the various policy statements  issued  by
\nthe  Central Government to ascertain the impact of the\tsaid
\nstatements  on\tthe business of the  appellant.\t  The  first
\nstatement  is found in the Press Note dated June  26,  1956,
\nissued by the Ministry of Commerce and Industry, New  Delhi.
\nBefore\tthe issue of the Press Note the miners who  produced
\nmanganese ore could enter into contracts with foreign buyers
\nand export their goods subject to the export control  rules.
\nBy this Press Note the Government introduced a change in its
\npolicy.\t  The following reason are given for  changing’\t the
\npolicy\t:  (1)\tThe  existing  trading\tmechanism  is  quite
\ninadequate to cope with the developments that took place  in
\ncertain\t countries  in the matter of purchase of  ores,\t and
\ntheir effect on Indian foreign trade. (2) The pre-occupation
\nof  Control authorities with the equitable  distribution  of
\navailable  wagon space amongst mining and trading  interests
\nhas  made it virtually impossible for the limited  resources
\nto  be\tused  to the maximum  advantage\t or  for  economical
\narrangements  to be made for the transportation of ores\t and
\nfor their
\n102<\/span>
\nhandling  at  the ports. (3) The trading  interests  entered
\ninto  large  contracts\tand some of them were  not  able  to
\nfulfil\tthem.  (4)  The\t mining industry  did  not  have  an
\nadequate  scope\t for development on sound  lines.   For\t the
\nforegoing  reasons, the Government propounded the  following
\nnew policy :\n<\/p>\n
\t      “Government   have  therefore  come   to\t the
\n\t      conclusion that it would be necessary for them
\n\t      to  play a more positive role to overcome\t the
\n\t      obstacles\t in  the way of\t augmenting  foreign
\n\t      exchange earnings from the export of ores.  It
\n\t      has  Accordingly been decided that  Government
\n\t      should  help in reorientating the\t trading  in
\n\t      ores  on\tmore rational lines  and  with\tthis
\n\t      object  in view they propose to  canalise\t the
\n\t      export  of ores in a progressively  increasing
\n\t      measure through the State Trading\t Corporation
\n\t      and  will, in fulfilling\tits  responsibility,
\n\t      rely  mainly  on the mining interests  in\t the
\n\t      country and use the existing trading mechanism
\n\t      to the extent practicable.  At the same  time,
\n\t      limited  opportunities  are  proposed  to\t  be
\n\t      provided\tto mining and trading interests\t for
\n\t      direct  participation  in\t the  export   trade
\n\t      within the limits of the board policy that may
\n\t      be  laid\tdown by the Government of  India  in
\n\t      this behalf.”\n<\/p><\/blockquote>\n
\t      Pursuant\tto the said policy, the\t Press\tNote
\n\t      informed\tthe trading public that it had\tbeen
\n\t      decided  to  regulate the export of  iron\t and
\n\t      manganese\t ores  during  the  half-year  July-<\/p><\/blockquote>\n
\t      December\t1956 through  established  shippers,
\n\t\t\t    mine-owners\t and the State Trading\tCorporatio
\nn
\n\t      and that export quotas would be granted on the
\n\t      following basis\n<\/p>\n
\t      (i)   Established\t  Shippers  will  be   given
\n\t      export  quotas  on the annual average  of\t the
\n\t      quantities actually exported during the  three
\n\t      calendar years, 1963, 1954 and 1955.\n<\/p>\n
\t      103<\/span><\/p>\n
\t      (ii)  Mine owners will be given export  quotas
\n\t      on  the annual average of the  quantities’  of
\n\t      ores  on\twhich  royalty\twas  actually\tpaid
\n\t      (excluding  quantities supplied  for  domestic
\n\t      consumption) during the three calender  years,
\n\t      1953,  1954, 1955.  Mine owners  whose  mining
\n\t      leases  had expired on 31st December 1955\t and
\n\t      have not been renewed thereafter, will not  be
\n\t      eligible.\n<\/p>\n
\t      (iii) State Trading Corporation will be  given
\n\t      quotas on an ad hoc basis.\n<\/p>\n
\t      It  was also stated that the quotas  would  be
\n\t      valid  for rail transport facilities  only  on
\n\t      the section which bad been used by the shipper
\n\t      in  the past and that the quota-holders  would
\n\t      not be permitted .to move on each section more
\n\t      than the quantity moved by them during any  of
\n\t      the three years 1953, 1954 1955.\tThrough\t the
\n\t      subsequent Press Notes is Issued from time  to
\n\t      time, the policy stated in the first statement
\n\t      was  implemented by gradually eliminating\t the
\n\t      shippers\t other\t than  the   State   Trading
\n\t      Corporation.   The High Court  has  considered
\n\t      all  the subsequent Press Notes in detail\t and
\n\t      has  accurately and succinctly summarized\t the
\n\t      various  steps  taken  by\t the  Government  to
\n\t      achieve its object.  In the circumstances,  it
\n\t      would be unnecessary to consider them again in
\n\t      detail.\tThe  High Court\t narrated  the\tsaid
\n\t      steps as follows
\n\t      (1)   To\tbegin with, the Manganese trade\t was
\n\t      controlled by a system of licensing of Export  Quotas.
\n\t      (2)   Press  Notes dated July 14,\t 1956,\tJuly
\n\t      30,  1956, August 6, 1956, September 4,  1956,
\n\t      and June 1, 1957 show that the quotas  granted
\n\t      to  shippers  and\t mineowners  were  with\t one
\n\t      exception\t  progressively\t reduced  for\teach
\n\t      successive period.\n<\/p>\n
\t      104<\/span><\/p>\n
\t      (3)   Until  the\tfifth statement\t dated\tSep-\n<\/p>\n
\t      tember  4,  1956 was made, the case  of  mine-\n<\/p>\n
\t      owners  who had no previous shipment of  their
\n\t      credit  was  not within the  contemplation  of
\n\t      Government  policy.   In\tthat  statement\t Go-\n<\/p>\n
\t      vernment\tannounced  that it  was\t considering
\n\t\t\t    their case but at no later stage does it appea
\nr
\n\t      that their case was specifically provided\t for
\n\t      until the State Trading Corporation took over.
\n\t      (4)   During  the\t period covered by  the\t 7th
\n\t      statement,  the State Trading Corporation\t was
\n\t      introduced   into\t the  picture\tand   freely
\n\t      competed with private interests.\tDuring\tthis
\n\t      period  small  quota holders were\t advised  to
\n\t      form  co-operatives  or  companies  and\twere
\n\t      discouraged.\n<\/p>\n
\t      (5)   Form  the  date of\tthe  8th  statement,
\n\t      viz.,  March  12, 1959, it is clear  that\t the
\n\t      full freedom of private trading as before\t was
\n\t      virtually\t stopped because all orders were  to
\n\t      be  canalized” through the State Trading\tCor-
\n\t      poration.\t  The terms and conditions on  which
\n\t      “canalization”  could take place were  onerous
\n\t      and  difficult  of  fulfilment  by  individual
\n\t      small    interests.    The    State    Trading
\n\t      Corporation itself laid down certain terms.
\n\t      (6)   There   were  no  restrictions  on\t the
\n\t      activities  of the State\tTrading\t Corporation
\n\t      and its quota was unlimited.\n<\/p>\n
\t      (7)   The policy was put into effect with\t the
\n\t      aid  of  the licensing  authorities  appointed
\n\t      under  the Imports and Exports  (Control)\t Act
\n\t      and  Order;  that\t port  authorities  and\t  by
\n\t      controlling the allocation of railway wagons.
\nIt  is\tclear  from the aforesaid  summary  of\tthe  various
\nnotifications that the policy deeded in
\n105<\/span>
\nthe  first  statement was  gradually  implemented–first  by
\nconfining   the\t issue\tof  quotas  and\t licences  only\t  to
\nrecognized exporters and the State Trading Corporation,\t and
\nlater on virtually conferring a monopoly on the Sate Trading
\nCorporation.  it,  would  also be noticed  that\t though\t the
\nGovernment  stated  in the earlier Press Notes that  it\t was
\nconsidering  the  case of mine-owners who  had\tno  previous
\nshipment  to their credit, during the prescribed  period  no
\nattempt\t was made to provide for them.\tThe result was\tthat
\nmine-owners,  who had no previous shipment to their  credit,
\nlike  the petitioner, could not move manganese\tore  outside
\ntheir  mines for ,export, for they could not sell except  to
\nthe  established shippers and the State Trading\t Corporation
\ntill  March  12,  1959,\t and thereafter\t only  to  the\tsaid
\nCorporation.   In the anxiety of the Government to  push  up
\nexport\ttrade in manganese ores persons who were not in\t the
\nfield  of  export trade during the  prescribed\tperiod\twere
\ntotally\t ignored,  with the result that their  industry\t and
\n,business   were   crippled.   Learned\t counsel   for\t the
\nrespondents   contends\t that  the   appellant\t filed\t the
\napplication for licence on December 11, 1958, for the  grant
\nof export not only to the State Trading Corporation but also
\nto other established shippers, mineowners and exporters, and
\nthat, therefore,  the  appellant  could\t not  have   much
\ndifficulty  in selling the manganese produced by him  either
\nto the one or to the other.  Apart from the validity of this
\nargument,  which  we will immediately consider,\t it  is\t not
\nclear  from the petition that the export licence  asked\t for
\nwas for a period before the issue of the 8th statement dated
\nMarch 12, 1959.\t The previous period would expire on June 1,
\n1959,  and  the\t 8th statement issued  on  March  12,  1959,
\nprovided  for the period between July 1959 and 1960,  during
\nwhich  period the State Trading Corporation had ‘obtained  a
\nvirtual monopoly in export trade in manganese.\tIt was\tmore
\nlikely
\n106<\/span>
\nthat the licence and the quota asked for related to the year
\n1959-60.   This should also be clear from the fact that\t the
\napplication was disposed of by the first respondent only  by
\nhis order dated December 17, 1958.  Be it as it may, I shall
\nconsider  the  argument alternatively.\tThe  argument  based
\nupon  the  alleged existence of a free\tmarket\twherein\t the
\npetitioner  could  sell\t his  manganese\t ore  to  recognized
\nexporters  is  not only unrealistic but also unfair  to\t the
\npetitioner.   What  was the market  wherein  the  petitioner
\ncould\tsell  his  manganese  ore  for\treasonable   prices?
\nAdmittedly  he\tcould not sell in the internal\tmarket,\t for
\nthere  was  practically no such market.\t None of  the  reco-
\ngnized\texporters,  either the established shippers  or\t the
\nState  Trading Corporation, was bound to purchase any  quota
\nfrom  the  petitioner or the miners in the position  of\t the
\npetitioner.  The recognized exporters were in a position  to
\ndictate\t terms and even to ignore some of  the\tmine-owners.
\nIn  short,  an artificial market was created for  the  mine-
\nowners\tlike  the  appellant wherein  they  could  sell\t the
\nmanganese  ore only to established shippers, if they  wanted
\nthe  ore  and for a price dictated by them.   The  so-called
\nmarket\t was  further  circumscribed  and  limited  to\t one
\npurchaser,  namely,  the State\tTrading\t Corporation,  after
\nMarch 1959.  The appellant complains that he could not\tsell
\nhis manganese more because of the said restrictions on\tsale
\nand export.  In his petition, the appellant alleged thus
\n\t      “The  State  Trading  Corporation,  under\t the
\n\t      colour of impugned Notices, has been dictating
\n\t      its  own\tprice and has been  thus  in  effect
\n\t      demanding every exorpitant commission for\t the
\n\t      purpose of giving facilities of exporting\t the
\n\t      petitioner’s  ore out of the  unlimited  quota
\n\t      allowed  to it.  The respondent No. 1 is\tthus
\n\t      bent on putting the
\n\t\t\t\t   107<\/span>
\n\t      petitioner  in heavy losses by forcing him  to
\n\t      sell  his\t ore to the  Corporation  at  lesser
\n\t      price.   The  petitioner has now at  hand\t 200
\n\t      tons  of manganese ore living at his mines  or
\n\t      sidings and valued at about Rs.20,0001\/- which
\n\t      is just being wasted as will be clear from the
\n\t      circular\tdated 20-4-1957 issued by  the\tCor-
\n\t      poration to the various mine-owners.\n<\/p>\n
\t      If the petitioner is not allowed to export his
\n\t      ore he would be stock piling about 50 tons  of
\n\t      ore,  per month valued at\t Us.  10,000\/without
\n\t      any outlet or rolling of the capital which  he
\n\t      has already invested as also the running\tcost
\n\t      including the wage bill of about Rs.4000\/- per
\n\t      month.   If on the other hand  the  petitioner
\n\t      has to close his mines for want of sale of the
\n\t      ore he will have to pay a compensation running
\n\t      into  several  thousands\tof  rupees  to\t the
\n\t      workmen  under the Industrial laws.   Besides,
\n\t      he   may\tbe  threatened\tunder  the   Mineral
\n\t      Concession Rules, 1949 for cancellation of his
\n\t      lease  for  having a stopped  working  of\t his
\n\t      areas.  The petitioner therefore submits\tthat
\n\t      an  impossible situation has been\t created  by
\n\t      the  respondent  No. 1  by  issue\t of  various
\n\t      Notices referred to above.”\n<\/p>\n
These  facts  are  not\tdenied.\t  Can  this  result,   which
\npractically  destroyed\tthe  trade  of\tthe  petitioner,  be
\ndescribed  as  a reasonable restriction on  his\t fundamental
\nright  ?  ‘Under the colour of\tcanalising  exports  through
\nspecialized  agencies or channels, the Government  conferred
\nvirtually  a monopoly on a public corporation, crippling  in
\nthe process the business of mine-owners like the petitioner.
\nSuch an unjust position cannot be brushed aside on a  simple
\nallegation  that  they can export through  the\tCorporation.
\nThere\tmay   be  some\tjustification  for  this,   if\t the
\nCorporation,  after  March  1959,  and,\t before\t that,\t the
\nestablished exporters were bound
\n108<\/span>
\nto some quota from the mine-owners like the appellant.\t The
\nlivelihood  of\ta person cannot be made to depend  upon\t the
\npassing moods of an officer of a State corporation,  however
\nwell-intentioned  he may be in the discharge of his  duties.
\nThe  scheme of channelling of exports through an  agency  or
\nagencies   could  certainly  be\t dovetailed  with  that\t  of
\nequitable apportionment of quotas amongst persons  producing
\nor doing business in manganese ore without any detriment  to
\nthe  object  of promoting export trade Any  scheme  of\tcan-
\nalization  of exports through specialized agencies  must  be
\ngoverned  by  definite rules whereunder\t provision  is\tmade
\ngiving stability and guarantee of fair treatment in ordinary
\ntimes  as  well\t as in times  of  emergency.   For  instance
\nappropriate  rules  could be framed fixing quotas  for\teach
\nmine-owner  the\t expected total quantity of  export,  having
\nregard\tto  the\t quality  and  the  quantity  of   manganese
\nproduced.   It\tmay also be necessary to appoint  an  expert
\nbody  under the said rules not only to advise the  State  in
\nfixing\tthe  quota but also for\t fixing\t reasonable  prices,
\nhaving regard to the relevant circumstances.  Perhaps,\tmany
\nother methods may be evolved to achieve the said result.  It
\nis for the Government and the experts to do so.\t But what  I
\nemphasize  is that, matters shall not be kept,, in  a  vague
\nuncertainty  in the minds of, persons affected by  the\tsaid
\nscheme, but the Government should evolve definite principles
\nby  making  rules, of course providing for  emergencies\t and
\nchange of circumstances.  I should not be understood to have
\ntied  down the hands of the Central Government by  the\tsaid
\nobservations, for it is left to it to make appropriate rules
\nin the light of the said observations.\n<\/p>\n
At this stage, another contention of learned counsel for the
\nappellant  may be noticed.  He argues that, unless a law  is
\nmade  by  the  State  for carrying  on\tthe  business  by  a
\ncorporation, owned
\n\t\t\t    109<\/span>
\nor  controlled by the State, to the exclusion,\tcomplete  or
\npartial\t of  citizens, a virtual monopoly brought  about  by
\nadministrative\taction\tunder  the  colour  of\ta  power  to
\ncanalize  the  trade  in  a  particular\t commodity   through
\nspecified channels must necessarily be an unreasonable\tres-
\ntriotion on the right of a citizen to carry on his  business
\nin  that commodity.  In support of this contention  reliance
\nis placed upon Art. 19(6) of the Constitution, as amended by
\nthe Constitution (First’ Amendment) Act, 1951, the  material
\npart of which reads:\n<\/p>\n
\t      “Nothing in sub-clause (g) of the said  clause
\n\t      shall affect the operation of any existing law
\n\t      in so far as it imposes, or prevent the  State
\n\t      from making any law imposing, in the interests
\n\t      of the general public, reasonable restrictions
\n\t      on the exercise of the right conferred by\t the
\n\t      said  sub-clause, and, in particular,  nothing
\n\t      in  the  said  sub-clause,  shall\t affect\t the
\n\t      operation of any existing law in so far as it
\n\t      relates  to, or prevent the State from  making
\n\t      any law relating to,-\n<\/p><\/blockquote>\n
\t      (i)…………………………………………\n<\/p><\/blockquote>\n
\t      (ii)  the\t carrying on by the State, or  by  a
\n\t      corporation, owned or controlled by the State,
\n\t      of any trade, business’ industry or  service.-
\n\t      whether to the exclusion, complete or partial,
\n\t      of citizens or otherwise.”\n<\/p><\/blockquote>\n
The amended article does not propric vigore confer any power
\non the State to create monopolies by administrative  action.
\nBut, it is only says that if a valid law is made conferring
\na  power on the State to carry on trade or business  to\t the
\nexclusion, complete or partial, of citizens, such a law will
\nnot infringe the fundamental right guaranteed under
\n110<\/span>
\nArt.  19 (1)(g) of the Constitution.  It does not also\tsay,
\nas  learned  counsel for the appellant argues,\tthat  unless
\nsuch a law is made, every interference by the State with the
\ntrade  of a citizen in exercise of a power under some  other
\nlaw  would necessarily be an unreasonable restriction:\tsuch
\nan interference will not have the protection of the  amended
\nprovision  of  the Constitution, but must be judged  by\t the
\nstandard provided by the first part of Art. 19(6); it  would
\nbe valid, if it was a reasonable restriction on the exercise
\nof  the petitioner’s fundamental right made in the  interest
\nof the general public.\tThe decision of this Court in Saghir
\nAhmad  v.  The\tState U. P.<\/a> (1) does  not  really  help\t the
\nappellant.  there, this Court was considering  the  question
\nwhether\t the U. P. Road Transport Act (11 of 1951)  violated
\nthe fundamental rights of private citizens guaranteed  under
\nArt. 19 (1)(g) of the Constitution, and was protected by cl.
\n(6)  of Art. 19.  The question fell to be considered on\t the
\nbasis of the article,, as it stood before it was amended  by
\nthe  Constitution (First Amendment) Act, 1951.\t This  Court
\nheld  that  it did offend the fundamental  right.   In\tthat
\ncontext, this Court made the following observations:\n<\/p>\n
\t      It  is quite true that if the present  statute
\n\t      was passed after the coming into force of\t the
\n\t      new   clause   in\t  article   19(6)   of\t the
\n\t      Constitution,  the question of  reasonableness
\n\t      would   not  have\t arisen\t at  all   and\t the
\n\t      appellant’s  case on this point, at any  rate,
\n\t      would have been unarguable.  These are however
\n\t      considerations   which   cannot\taffect\t our
\n\t      decision in the present case, the amendment of
\n\t      the Constitution, which come later, cannot  be
\n\t      invoked  to  validate an\tearlier\t legislation
\n\t      which  must  be regarded\tas  unconstitutional
\n\t      when it was passed.”\n<\/p><\/blockquote>\n
(1)  (1955) 1 S.C.R. 707, 727.\n<\/p>\n
111<\/span><\/p>\n
I  do  not see how these observations  help  the  appellant.
\nThey only state the obvious, namely, that if there was a law
\nwithin\tthe meaning of the amended article, no\tquestion  of
\ninfringing  the fundamental right would arise.\tThere is  no
\nforce  in  this\t argument.  This question  anyhow  does\t not
\naffect\tmy decision, as I have come to the  conclusion\tthat
\nthe  Press Notes issued by the Government clearly  infringed
\nthe fundamental right of the petitioner.\n<\/p>\n
But,  in view of the fact that the period for which  licence
\nwas  asked had run out, the application in  respect  thereof
\nhas  become infructuous and, therefore has to be  dismissed.
\nIn  the\t result,  the  appeal  is  dismissed,  but,  in\t the
\ncircumstances of this case, without costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Dava Son Of Bhimji Gohil vs Joint Chief Controller Of Imports … on 16 April, 1963 Equivalent citations: 1962 AIR 1796, 1963 SCR (2) 73 Author: N R Ayyangar Bench: Ayyangar, N. Rajagopala PETITIONER: DAVA SON OF BHIMJI GOHIL Vs. RESPONDENT: JOINT CHIEF CONTROLLER OF IMPORTS & EXPORTS DATE OF JUDGMENT: […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-206758","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nDava Son Of Bhimji Gohil vs Joint Chief Controller Of Imports ... on 16 April, 1963 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/dava-son-of-bhimji-gohil-vs-joint-chief-controller-of-imports-on-16-april-1963-2\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Dava Son Of Bhimji Gohil vs Joint Chief Controller Of Imports ... on 16 April, 1963 - 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