High Court of Karnataka Quashes FIR Against Businessman in Essential Commodities Act Case — No Prima Facie Case for Hoarding or Black Marketing. Allegations of storing paddy without license fail as petitioner was a trader and not a miller, and no violation of Essential Commodities Act, 1955 or Karnataka Essential Commodities (Licensing, Control and Stock Declaration) Order, 1977 was made out.

High Court: Karnataka High Court Bench: DHARWAD In Favour of Accused
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Case Note & Summary

The petitioner, Lalit Kumar Jain, a businessman and proprietor of M/s. Preetam Traders, filed a writ petition under Articles 226 and 227 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973, seeking quashing of the complaint and FIR registered in Tadas Police Station Crime No.1/2019 for offences punishable under Sections 3 and 7 of the Essential Commodities Act, 1955. The FIR was based on a raid conducted by the respondents, including police officers and a Food Inspector, who allegedly found paddy stored in the petitioner's godown without a valid license. The petitioner contended that he was a trader and not a miller, and that the storage of paddy was in the ordinary course of business, which did not require any license under the Karnataka Essential Commodities (Licensing, Control and Stock Declaration) Order, 1977. The court heard the petitioner's counsel, the learned AGA for respondent No.1, and counsel for respondents 2 to 4 and respondent No.5. The court examined the provisions of the Essential Commodities Act, 1955 and the relevant Order, and noted that the Order applies only to millers and not to traders. The court found that the allegations in the FIR did not disclose any violation of the Act or the Order, and that continuing the proceedings would be an abuse of the process of law. Accordingly, the court allowed the petition and quashed the FIR and all proceedings arising therefrom.

Headnote

A) Criminal Procedure Code, 1973 - Section 482 - Quashing of FIR - Abuse of Process - The High Court quashed FIR registered against a businessman for alleged violation of Essential Commodities Act, 1955, holding that the allegations did not make out a prima facie case. The petitioner was a trader and not a miller, and the stock of paddy was stored in the course of business without any prohibition under the Act or the relevant Order. (Paras 1-6)

B) Essential Commodities Act, 1955 - Sections 3 and 7 - Storage of Paddy - License Requirement - The court held that the petitioner, being a trader, was not required to obtain a license under the Karnataka Essential Commodities (Licensing, Control and Stock Declaration) Order, 1977 for storing paddy, as the Order applies to millers and not traders. The FIR was quashed as there was no violation of the Act. (Paras 2-6)

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Issue of Consideration

Whether the FIR registered against the petitioner for offences under Sections 3 and 7 of the Essential Commodities Act, 1955, alleging storage of paddy without license, constitutes an abuse of process of law warranting quashing under Section 482 Cr.P.C. read with Articles 226 and 227 of the Constitution.

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Final Decision

The petition is allowed. The complaint and FIR registered in Tadas Police Station Crime No.1/2019 for offences under Sections 3 and 7 of the Essential Commodities Act, 1955, and all proceedings arising therefrom, are quashed.

Law Points

  • Essential Commodities Act
  • 1955
  • Sections 3 and 7
  • Karnataka Essential Commodities (Licensing
  • Control and Stock Declaration) Order
  • 1977
  • Prima facie case
  • Quashing of FIR
  • Abuse of process of law
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Case Details

2019 LawText (KAR) (02) 76

Writ Petition No.105358/2019 (GM-RES)

2019-02-25

H.P. Sandesh

V.M. Sheelavant, Anthony R Rodrigues, L.S. Sullad, M.B. Hiremath

Lalit Kumar Jain

The State of Karnataka, H.N. Anjaneya, R.F Desai, Shri Shivanand, Sri. Mantesh Patil

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Nature of Litigation

Writ petition under Articles 226 and 227 of the Constitution read with Section 482 Cr.P.C. seeking quashing of FIR and complaint.

Remedy Sought

Petitioner sought a writ of certiorari or any other appropriate writ to quash the complaint and FIR registered in Tadas Police Station Crime No.1/2019.

Filing Reason

Petitioner alleged that the FIR was registered without any prima facie case and was an abuse of process of law, as he was a trader and not a miller, and storage of paddy did not require a license under the relevant Order.

Issues

Whether the FIR discloses any prima facie offence under Sections 3 and 7 of the Essential Commodities Act, 1955? Whether the continuation of proceedings would be an abuse of process of law warranting quashing under Section 482 Cr.P.C.?

Submissions/Arguments

Petitioner's counsel argued that the petitioner is a trader and not a miller, and the storage of paddy was in the ordinary course of business, which does not require any license under the Karnataka Essential Commodities (Licensing, Control and Stock Declaration) Order, 1977. Respondents argued that the petitioner was storing paddy without a valid license, which is a violation of the Essential Commodities Act, 1955.

Ratio Decidendi

The High Court held that the allegations in the FIR did not make out a prima facie case under the Essential Commodities Act, 1955, as the petitioner was a trader and not a miller, and the storage of paddy did not require a license under the Karnataka Essential Commodities (Licensing, Control and Stock Declaration) Order, 1977. Continuing the proceedings would be an abuse of the process of law, warranting quashing under Section 482 Cr.P.C.

Judgment Excerpts

Heard the petitioner's counsel, learned AGA for respondent No.1, learned counsel appearing for respondent Nos.2 to 4 and also learned counsel for respondent No.5. The petitioner by filing this writ petition under Articles 226 and 227 of the Constitution of India read with Section 482 of Cr.P.C. sought for an order to issue a writ in the nature of certiorari or any other appropriate writ, order or direction to quash the complaint and FIR registered in Tadas Police Station Crime No.1/2019 for the offences punishable under Sections 3 and 7 of the Essential Commodities Act, 1955 produced at Annexures-B and C respectively etc.

Procedural History

The petitioner filed a writ petition under Articles 226 and 227 of the Constitution of India read with Section 482 Cr.P.C. before the High Court of Karnataka, Dharwad Bench, seeking quashing of the complaint and FIR registered in Tadas Police Station Crime No.1/2019. The petition came up for preliminary hearing 'B' group and was disposed of on 25th February 2019.

Acts & Sections

  • Essential Commodities Act, 1955: 3, 7
  • Code of Criminal Procedure, 1973: 482
  • Constitution of India: 226, 227
  • Karnataka Essential Commodities (Licensing, Control and Stock Declaration) Order, 1977:
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