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The U. P. Sugarcane Cess (Validation) Act, 1961
Article 226 in The Constitution Of India 1949
Article 243G in The Constitution Of India 1949
Article 14 in The Constitution Of India 1949
State Of U.P vs P.A. Madhu on 17 July, 1984

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Allahabad High Court
Pappu vs State Of U.P. And Others on 3 November, 1999
Equivalent citations: 2000 (1) AWC 1
Author: N Mitra
Bench: N Mitra, S Singh



JUDGMENT
 

 N.K. Mitra, C.J.

1. The special appeal is directed against the judgment and order dated 24.9.1999 by which the learned single Judge dismissed the appellant's writ petition being Civil Misc. Writ Petition No. 1407 of 1999 instituted against cancellalion of his fair price shop holding that the writ petition was not maintainable in view of the Full Bench decision of the Court in U. P. Sasta Galla Vikreta Panshad v. State of U. P. and others.

2. The first question that needs to be considered and decided pertains to maintainability of the writ petition which was instituted by the appellant challenging the order of cancellation of fair price shop allotted to him. The learned single Judge has dismissed the writ petition as not maintainable. He has placed reliance on the Full Bench decision referred to above. The Full Bench decision, reliance on which has been placed by the learned single Judge, has maintained that in the matter of non-statutory contracts, the rights of the parties thereto are governed by the terms and conditions of the contract and not by any constitutional or statutory provision and, therefore, breach of contract, if any, would not be enforceable by means of the remedy provided under Article 226 of the Constitution of India, The Full Bench further held that any action taken or any order passed in such contractual matters by the State or its officials, however wrong or arbitrary it may be, cannot be challenged under Article 226 of the Constitution inasmuch as Article 14 could not be extended to such contractual matters. A writ petition may be held to be not maintainable either due to the reason that the jurisdiction of the High Court under Article 226 of the Constitution of India in respect of the matter under challenge therein has been taken away by or under any provision of the Constitution. A writ petition in respect of employment under Union of India, for example, would not be maintainable in the first instance due to the reason that for the redressal of such a dispute, the aggrieved party is under the law to approach to the Central Administrative Tribunal in the first instance before approaching the High Court. A petition may be held not maintainable also for the reason that it does not disclose any cause of action or triable Issues : or may be due to the reason that the cause of action has arisen beyond the territorial jurisdiction of the High Court in which the writ petition is instituted or may be due to the reason that the opposite parties are not amenable to the writ jurisdiction of the Court. There may be variety of other reasons on which the Court may decline to entertain a writ petition even though it is otherwise maintainable. The case on hand is not a case where the jurisdiction of the High Court under Article 226 may have been expressly or impliedly taken away by any constitutional provision nor is it a case of extraterritorial jurisdiction nor even a case falling in the category where no cause of action is disclosed or no triable issue is raised in the writ petition.

3. Question raised in the writ petition giving rise to the instant Special Appeal pertained to legality and validity and the resolution passed by the concerned Grain Panchayat in re-cancellation of fair price shop allotted to the petitioner-appellant and consequential order passed by the concerned Up-Zlladhikari. It is not disputed that the impugned resolutions and . the consequential order were passed after the issuance of the Government Order No. 3035/29-Aa-6-9937 Sa./99. Khadya Tatha Rasad Anubhag 6. Lucknow, dated August 10. 1999 in re-selection, etc. of fair price shops in rural areas in the background of decentralization of power in view of the Seventy-third Constitution amendment by which Part IX in Re : "The panchayats" and Eleventh Schedule were added in the Constitution. Part IX consists of Articles 243 to 243ZG, Article 243G, which is relevant to the controversy herein, is quoted below :

"243G. Powers, authority and responsibilities of panchayats.--Subject to the provisions of the Constitution, the Legislature of a State may. by taw, endow the panchayats with such powers and authority as may be necessary to enable them to function as institutions of self-Government and such law may contain provisions for the devolution of power and responsibilities upon panchayats at the appropriate levels subject to such conditions as may be specified therein with respect to :

(a) the preparation of plans for economic development and social justice ;

(b) the Implementation of schemes for economic development and social justice as may be entrusted to them including those in relation to the matters listed in the Eleventh Schedule."

4. Matters listed in the Eleventh Schedule include 'Public distribution system' at item No. 28. In order to give effect to the doctrine of decentralisation of power as visualized in Article 243G of the Constitution, the U. P. Panchayat Raj Act, 1947 was suitably amended with respect to the preparation of plans for economic development and social justice, etc. and the implementation of schemes for economic development in relation to the matters listed in Eleventh Schedule. Section 15 of the U. P. Panchayat Raj Act, 1947 as it stands substituted by U. P. Act No. 9 of 1994 in the light of the constitutional mandate envisaged under Part IX of the Constitution enlist the functions that are to be performed by a Gram Panchayat. The Section in so far as it is relevant reads as under :

"15. Functions of Gram Panchayat.--Subject to such conditions as may be specified by the State Government, from time to time a Gram Panchayat shall perform the following functions, namely,--

  * * *      *             *
 

 (xxix) Public Distribution System : 

  

 (a)   Promotion of public awareness with regard to the distribution of essential commodities. 
 

 (b)   Monitoring the public distribution system.  
 

 (XXX) ....." 
 

It would thus be evident that so far as the matter relevant to public distribution system is concerned, the State Legislature has amended U. P. Panchayat Raj Act by substituting Section 15 in the light of the constitutional mandate envisaged by Article 243G of the Constitution. The Government Order dated 10.8.1999 and the Government Orders referred to therein have been issued In exercise of power under Section 15 of the U. P. Panchayat Raj Act specifying therein the conditions of allotment of fair price shops and their cancellation under the public distribution system. Government Order provides in no uncertain terms that selection of the fair price shops and cancellation thereof shall be done by the concerned Gaon Sabha in the manner prescribed therein. Relevant part of the Government Order reads as under.

^^lafo/kku ds 73osa la'kks/ku ds vuqe esa xzkeh.k {ks= dh lkoZtfud forj.k iz.kkyh ds vUrxZr mfpr nj dh nqdkuksa dks fu;qfDr rFkk fujLrhdj.k dk vf/kdkj xzke lHkkvksa dks ns fn;k x;k gSA vr,o xzkeh.k Js= dh mfpr nj dh bu nqdkuksa ds n'kk vkfn ds laca/k esa iwoZ esa fuxZr leLr 'kklukns'kksa esa vko';d la'kks/ku djrs gq, fuEu funsZ'k fn;s tkrs gSA** 1-

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8- bl O;oLFkk ds iwoZ esa xzkeh.k {ks= esa fu;ekuqlkj dk;Zjr 'kklu ds nqdkunkjksa dh nqdkusa ;Fkkor pyrh jgsaxhA fdUrq bu iqjkus nqdkunkjksa ds djk, x, iqjkus vuqcU/kksa ds LFkku ij rhu ekg ds vUnj ij izLrj 11-7&v esa mfYyf[kr fd;s x;s vuqcU/k&i= ij u;k vuqcU/k djk;k tk;sxk rfkk muls Hkh izfrHkwfr dh /kujkf'k : 1]000 xzke fuf/k esa tek djk;h tk;sxhA 9-

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10- fdlh nqdkunkj }kjk vuqlwfpr oLrqvksa ds mBku ,oa forj.k esa vfu;ferrk ,oa xM+cM+h fd;s tkus dh f'kdk;r izkIr gksus ij vFkok vU; izdkj ls ,slh tkudkjh feyus ij bldh tkWp xzke iapk;r dh iz'kklfud lfefr }kjk dh tk;sxhA tkWp vk[;k rfkk leLr rF; xzke lHkk dh [kqyh cSBd esa j[kh tk;sxh ftu ij fopkj foe'kZ ds ckn cSBd esa fu.kZ; fy;k tk;sxkA xzke lHkk ds fu.kZ; ds vuqlkj xzke iapk;r ofkdl vf/kdkjh }kjk vfxze vf/kdkjh }kjk vfxze dk;Zokgh dh tk;sxhA 11- nqdku fuyfEcrA fujLr gksus ij xzke iapk;r bldh lwpuk lEcfU/kr mi ftykf/kdkjh rfkk ftyk iwfrZ vf/kdkjh dks nsxh ,oa ubZ fu;qfDr rd cSdfYid O;oLFkk djus ds fy, vuqjks/k djsxhA lwpuk izkIr gksus ij mi ftykf/kdkjh@ftyk iwfrZ vf/kdkjh fuyafcr@fujLr nqdku ls lEc) jk'ku dkMksZa dks ikl dh vU; nqdku ls lEc) djus ds vkns'k djsaxsA 12- xzke lHkk ;FkklEHko ,d ekg ds vUnj fuyfEcr nqdku ds fo:) vfxze dk;Zokgh iw.kZ dj u;s nqdkunkj ds p;u vFkok iqjkus nqdkunkj dh cgkyh tSlh Hkh fLFkfr gks] dk fu.kZ; ysxhA bl fu.kZ; ds ckn mli ftykf/kdkjh }kjk dh xbZ O;oLFkk Lor% lekIr gks tks;xhA 13- xzke lHkk ds vfrfjDr jk'ku ds nqdkunkj ds dk;ksZa dh tkWp ftykf/kdkjh] vij ftykf/kdkjh] ftyk iwfrZ vf/kdkjh rFkk mi ftykf/kdkjh }kjk Loizsj.kk vFkok f'kdk;r vkfn feyus ij dh tk ldrh gS rFkk xEHkhj vfu;ferrk dh fLFkfr esa ;g vf/kdkjh Hkh jk'ku dh nqdkuksa ds fuyEcu vFkok fujLrhdj.k ds vkns'k ns ldrs gSa vkSj ,sls vkns'k xzke lHkk rFkk nqdkunkj ij ck/;dkjh gksaxsA 14- ------------------------------------------

15- xzke lHkk }kjk jk'ku dh nqdku ds fuyEcu @ fujLrhdj.k ds vkns'k ds fo:) vihy fd;s tkus dh dksbZ O;oLFkk ugha gksxhA vc xzke lHkk }kjk tkjh vkns'k gh vfUre ekuk tk;sxk ftlds fo:) dksbZ vihy xzk; ughagksxhA ijUrq orZeku esa e.Myk;qksa ds Lrj ij iqjkuh yfEcr vihyksa dk fuLrkj.k lacaf/kr e.Myk;qDr gh djsaxsA ..........................................................................."

5. It would thus appear that the selection and cancellation of fair price shops are no longer a contractual matter. It is now governed by the statutory provisions namely Section 15 of the U. P. Panchayat Raj Act read with Government Order dated 10.8.1999 which has the force of law being a provision having statutory flavour. In the instant case, the allotment of fair price shops in favour of the petitioner-appellant herein was cancelled by the concerned Gram Panchayat but without following the procedure prescribed in para 10 of the Government Order referred to above which provides for an "enquiry" by the Administrative Committee of the Gram Panchayaf into the complaints regarding irregularities in the distribution of scheduled commodities by the allottee of the fair price shop. The enquiry visualised by clause 10 of the Government Order must, in our opinion, be held in a fair manner in tune with the principles of natural justice. The fact that the decision regarding cancellation is required to be taken by the Gram Sabha In its open meeting would suggest that there should be transparency in the decision-making process. A decision regarding cancellation of fair price shop taken by the Goon Sabha sans any enquiry in tune with the principles of natural justice cannot be sustained being contrary to the procedure laid down in the Government Order aforestated which ensures procedural fairness in the matter of cancellation of fair price shops.

6. In U. P. Sasta Galla Vikreta Parishad (supra), a Full Bench of this Court held that the agreement for sale of scheduled commodities through fair price shops entered into between the individual and the District Magistrate is not a statutory agreement and writ petition against order of termination or suspension of agreement for sale of scheduled commodities through fair price shops would not be maintainable. Having heard Sri G. D. Srivastava. Senior Advocate for the appellant and standing counsel representing the State, we are of the view that the decision relied on by the learned single Judge has no application to a case of cancellation of an allotment of a fair price shop for distribution of scheduled commodities the grant or cancellation of which is now governed by Section 15 of the U. P. Panchayat Raj Act, 1947 read with the Government Order referred to above which has the force of law. The Government Order is traceable for its source to Section 15 of the Act and Article 162 of the Constitution of India which provides that subject to the provisions of the Constitution, the executive power of the State shall extend to the matters with respect to which the Legislature of the State has power to make laws : "Provided that in any matter with respect to which the Legislature of a State and Parliament have power to make laws, the executive power of the State shall be subject to, and limited by, the executive power expressly conferred by this Constitution or by any law made by Parliament upon the Union or authorities thereof." Clause 4 of the U. P. Scheduled Commodities Distribution Order, 1990, which was under consideration before the Full Bench visualised that the fair price shop would be run by such person and in such manner as the Collector, subject to the direction of the State Government, may decide and the person authorised to run the fair price shop would be treated as the agent of the State Government. By a letter dated 3.7.1990, the Government issued instructions to all the District Magistrates laying down therein the procedure for selection of agents in rural areas and by clause 6 thereof the District Magistrates had been directed to get contracts executed in the prescribed proforma by the agents running the fair price shop. Clause 11 of the said letter made provision for appeal against the order of appointment, suspension, cancellation or non-renewal of contracts. Under the present system, the allotment of a fair price shop is done pursuant to a resolution passed in that regard by the concerned Gram Sabha. The qualifications have been prescribed in the Government Order. The status of the allottee is not that of an agent of the State Government. The manner of allotment and the procedure for cancellation is prescribed in the Government Order which has the force of law. Once an allotment is made in favour of a person, he acquires a right to run the shop in the manner prescribed in the Government Order. The allottee runs the risk of cancellation only in the event of committing irregularities in the distribution of scheduled commodities. Gaon Sabfia is a local authority within the meaning of Article 12 of the Constitution and its decision affecting rights of citizens cannot go beyond the purview of judicial review under Article 226 of the Constitution of India. Allotment of fair price shop is made pursuant to a resolution passed by the Gaon Sabha and is issued under Joint signature of Gram Panchayat and Gram Panchayat Vikas Adhikari. It is true that the "Dukandar" has to execute an agreement on the non-judicial stamp paper of Rs. 100 but termination of the agreement being regulated by Section 15 of the U. P. Panchayat Raj Act read with the Government Order which has the force of law. the validity of the order terminating the grant can be questioned by the aggrieved party In a petition under Article 226 of the Constitution which provides a public law remedy by way of judicial review of State action as well as public functions whether performed by public authority or by private body. A body, it may be observed, is said to be performing a "public function" when it seeks to achieve some collective benefit for the public or a section of the public and is accepted by the public or that section of the public as having authority to do so. It may be observed that it is not the source of power but the public nature of power that determines whether the body is performing a public function. Public function, it may be observed, is not the exclusive domain of the State. It has been held in Anandi Mukta S.M.V.S.S.J.M.S. Trust v. V. R. Rudani, (1989) 2 SCC 691, that :

"The form of the body concerned is not very much relevant what is relevant is the nature of the duty imposed on the body. The duty must be judged in the light of positive obligation owned by the person or authority to the affected party. No matter by what means the duty is imposed, if a positive obligation exists mandamus cannot be denied. ..... Mandamus is a very wide remedy, which must be easily available to reach Injustice wherever it is found. Technicalities should not come in the way of granting that relief under Article 226."

7. In the words of Prof. De Smith : "To be enforceable by mandamus, a public duty does not necessarily have to be imposed by statute. It may be sufficient for the duty to have been imposed by charter, common law, custom or even by contract." In the case of U. P. State Co-operative Bank Limited v. Chandra Bhan Dubey, (1999) 1 SCC 741. it has been held that expansive and extraordinary power of the High Court under Article 226 is "as wide as (he amplitude of the language used Indicates and so can affect any person even a private individual and be available for any (other) purpose, even one for which another remedy may exist". The power of the High Court under Article 226 is plenary and unlimited and writ or appropriate direction can be issued by the Court in exercise of its powers under Article 226 of the Constitution of India even in respect of contractual matters having an element of public interest. In the case of U. P. State Co-operative Bank Limited (supra), the Supreme Court has laid down the following proposition :

".....The Constitution is not a statute. It is a fountain head of all statutes. When the language of Article 226 is clear, we cannot put shackles on the High Courts to limit their jurisdiction by putting an interpretation on the words which would limit their jurisdiction. When any citizen or person is wronged, the High Court will step in to protect him, be that wrong be done by the State, an instrumentality of the State, a company or a cooperative society or association or body of individuals, whether incorporated or not, or even an individual. Right that is infringed may be under Part /// of the Constitution or any other right which the law validly made might confer upon him."

8. In Jagveer Singh v. Chairman Co-operatiue Textile Mills Limited, Bulandshahr and another, 1999 (3) AWC 2349. a Division Bench of this Court held as under :

"The co-operative society, therefore, cannot be equated with an individual and being engaged in various activities of public interest the co-operative societies cannot claim impunity in respect of their action vis-a-vis their employees from judicial superintendence and control of the High Court under Article 226 of the Constitution of India. In our opinion, co-operative societies registered under the Act are as much bound as State to follow the fundamental principles of reasonableness, fairness and transparency which, under the scheme of our constitutions, are fundamental to governance of any democratic institution."

9. The present case stands on a better footing. Allotment of fair price shop or its cancellation is now a statutory function of the Gram Panchayat. Exercise of statutory power by Gram Panchayat for collateral purposes is interdicted by Article 14 of the Constitution. Arbitrary grant or cancellation of fair price shop Is open to judicial review under Article 226. The Full Bench decision reliance on which has been placed by the learned single Judge in dismissing the writ petition as not maintainable. In our opinion, has been rendered obsolete in view of the constitutional and statutory amendments referred to above. The functions assigned to the Gram Panchayat under Section 15 of the U. P. Panchayat Raj Act, 1947 are in the nature of public functions and, therefore, acts or omissions of the Grarn Panchayat in relation to such function shall be open to judicial review under Article 226 of the Constitution on the touch stone of public interest and fairness etc. The Gram Panchayat being a statutory authority endowed with statutory functions cannot claim an impunity in respect of its functions vis-a-vis public distribution system. We are, therefore, of the considered view that the writ petition was maintainable. Learned single Judge fell into an error in dismissing the writ petition as not maintainable.

10. On facts, it is writ large on the face of record that no enquiry into the complaint, if any, against the petitioner was held as per requirement of the Government Order dated August 10. 1999. The decision taken by Gram Panchayat, therefore, cannot be sustained. The consequential order passed by the concerned Up-Ziladhikari will naturally not survive if the resolution passed by the Gram Panchayat is quashed.

11. In the result, the appeal succeeds and is allowed. Judgment of the learned single Judge is set aside and the orders impugned in the writ petition are quashed with liberty reserved to the concerned Gram Panchayat to take such decision as it may deem fit and proper after holding a proper enquiry in tune with the principles of natural Justice as contemplated by Government Order dated August 10, 1999.