Case Note & Summary
The petitioners, two sugar cooperative factories, filed criminal writ petitions challenging the fixation of levy sugar price by the Central Government under the Essential Commodities Act, 1955. They contended that the price fixed was arbitrary, unreasonable, and violative of Articles 14 and 19(1)(g) of the Constitution of India. They also argued that they were not given a hearing before the fixation. The court, after hearing arguments, held that price fixation is a legislative function and courts cannot interfere unless the fixation is demonstrably arbitrary or mala fide. The court noted that the government considers cost data and recommendations of the Bureau of Industrial Costs and Prices. The court found no arbitrariness and dismissed both petitions.
Headnote
A) Constitutional Law - Levy Sugar Price Fixation - Article 14, Article 19(1)(g) Constitution of India - Challenge to price fixation as arbitrary and unreasonable - Held that price fixation is a legislative function and courts cannot substitute their own view unless the fixation is demonstrably arbitrary or mala fide - Petitioners failed to establish arbitrariness - Petitions dismissed (Paras 1-10).
B) Essential Commodities Act, 1955 - Levy Sugar Price Fixation - Section 3 - Administrative Law - Natural Justice - Right to hearing before price fixation - Held that price fixation under Section 3 is not a quasi-judicial function and no right to be heard arises - The government considers cost data and recommendations of expert bodies - No violation of principles of natural justice (Paras 1-10).
Issue of Consideration
Whether the fixation of levy sugar price by the Central Government under the Essential Commodities Act, 1955 is arbitrary, unreasonable, and violative of Articles 14 and 19(1)(g) of the Constitution of India, and whether the petitioners are entitled to a hearing before such fixation.
Final Decision
Both criminal writ petitions are dismissed.
Law Points
- Levy sugar price fixation under Essential Commodities Act
- 1955 is a policy decision not subject to judicial review unless arbitrary or mala fide
- Price fixation under Section 3 of Essential Commodities Act
- 1955 is not a quasi-judicial function
- No right to be heard before fixation of levy sugar price
- Levy sugar price is fixed based on cost data and recommendations of Bureau of Industrial Costs and Prices
- Challenge to price fixation on ground of inadequacy is not maintainable
Case Details
2005 LawText (BOM) (02) 271
Criminal Writ Petition No.719 of 2004 and Criminal Writ Petition No.722 of 2004
Mr.C.J.Sawant with S.N.Bhadrashete for Petitioners, Mr.D.N.Salvi for Respondent Nos.1 to 4, Mr.D.S.Mhaispurkar for State
Vasantraodada Patil Sahakari Sakhar Karkhana Ltd. & Ors. and Dongrai Sagareshwar Shetkari Sahakari Sakhar Karkhana Ltd.
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Nature of Litigation
Criminal writ petitions challenging the fixation of levy sugar price by the Central Government under the Essential Commodities Act, 1955.
Remedy Sought
Quashing of the levy sugar price fixation order and direction to fix a higher price.
Filing Reason
Petitioners contended that the levy sugar price fixed by the Central Government was arbitrary, unreasonable, and violative of Articles 14 and 19(1)(g) of the Constitution of India, and that they were not given a hearing before fixation.
Issues
Whether the fixation of levy sugar price by the Central Government under the Essential Commodities Act, 1955 is arbitrary and violative of Articles 14 and 19(1)(g) of the Constitution of India?
Whether the petitioners are entitled to a hearing before fixation of levy sugar price?
Submissions/Arguments
Petitioners argued that the levy sugar price fixed is arbitrary and unreasonable, and that they were not given a hearing.
Respondents argued that price fixation is a legislative function and not subject to judicial review unless arbitrary or mala fide, and that no hearing is required.
Ratio Decidendi
Price fixation under Section 3 of the Essential Commodities Act, 1955 is a legislative function. Courts cannot substitute their own view unless the fixation is demonstrably arbitrary or mala fide. No right to be heard arises before such fixation.
Judgment Excerpts
Price fixation is a legislative function and courts cannot substitute their own view unless the fixation is demonstrably arbitrary or mala fide.
No right to be heard arises before fixation of levy sugar price under Section 3 of the Essential Commodities Act, 1955.
Procedural History
The petitioners filed Criminal Writ Petition No.719 of 2004 and Criminal Writ Petition No.722 of 2004 before the High Court of Judicature at Bombay challenging the levy sugar price fixation. The court heard both petitions together and dismissed them.
Acts & Sections
- Essential Commodities Act, 1955: Section 3
- Constitution of India: Article 14, Article 19(1)(g)
