# Vishnu Kumar v. State of U.P. & Ors

- **Citation:** (2020) 9 ILRA 626
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2019-11-28
- **Case number:** WRIT - C No. 30544 of 2019
- **Bench:** Pankaj Mithal, Dr. Yogendra Kumar Srivastava
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/vishnu-kumar-v-state-of-u-p-ors-45106
- **Pages:** 15

## Headnote

(A) Civil Law - Essential Commodities Act,
1955 - Section 3/7 - Indian Penal Code,
1860 - Section 420 - Motor Spirit and High
Speed Diesel (Regulation of Supply, Distribution
and Prevention of Malpractices) Order, 2005 -
Clause 4 - Restriction on marketing of motor spirit
and high speed diesel - Clause 6-A - Limited
purpose of direct sale of bio-diesel blending with
high speed diesel - Clause 7 - Power of search and
seizure - Clause 8 - Sampling of Product and
testing - Clause 9 - Power of Central Government
to issue directions - Clause 10 - Overriding effect .

Petitioner running retail outlet - no permission
in terms of Clause 6-A of the Control Order -
guidelines contained in the Government Order
dated 27.10.2016 not followed - retail outlet of
the petitioner inspected - found that stocks
contained in the underground tank adulterated
with kerosene oil - F.I.R. lodged against the
petitioner under Section 420 IPC read with
Section 3/7 Essential Commodities Act, 1955 -
bio-diesel retail centre of the petitioner sealed -
provisions of the MS-HSD Order, 2005 as
amended by the Amendment Order 2017 and
guidelines under the Government Order dated
27.10.2016 contravened - powers of search and
seizure exercised by the respondent authorities
as per the provisions of Clause 7 of the MS-HSD
Order, 2005 cannot be faulted with - direction to
the respondent to open the seal of the retail
centre of the petitioner and not to interfere in
its functioning. (Para - 5,38,40)

HELD: - Quashing of the sealing order and
opening of the seal of the underground tank of
the retail unit of the petitioner cannot be
granted at this stage. (Para - 41)

Petition dismissed. (E-7)

List of Cases cited: -

## Text

_Characters 0–39,925 of 50,103. This is a partial read: ask again with offset=39925 for what follows._

626 INDIAN LAW REPORTS ALLAHABAD SERIES

(ii) the issuance of the Government
Order dated 29.08.2014 and its acceptance by
Y.E.I.D.A. is patently illegal. It is violative of
the provisions of the L.A. Act and is otherwise
without jurisdiction as no such Government
Order is liable to be issued in equity by the
Government and that the policy behind it is
unfair, unreasonable and arbitrary which is in
violation of the provisions of the T.P. Act; and

(iii) the aforesaid Government Order
dated 29.08.2014 as such is held to be invalid
and liable to be ignored. Consequentially, all
actions and demands of the Y.E.I.D.A. based
upon it are held to be illegal.

119. In view of above facts and
circumstances, the impugned Government
Order dated 29.08.2014 is declared to be
illegal
and
without
jurisdiction
and
consequently all demands raised on its
basis are quashed.

120. The Writ Petitions are allowed
with no orders as to costs.
----------
(2020)09ILR A626
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 28.11.2019

BEFORE

THE HON'BLE PANKAJ MITHAL, J.
THE HON'BLE DR. YOGENDRA KUMAR
SRIVASTAVA, J.

WRIT - C No. 30544 of 2019

Vishnu Kumar ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Ankit Agarwal

Counsel for the Respondents:
C.S.C.
(A) Civil Law - Essential Commodities Act,
1955 - Section 3/7 - Indian Penal Code,
1860 - Section 420 - Motor Spirit and High
Speed Diesel (Regulation of Supply, Distribution
and Prevention of Malpractices) Order, 2005 -
Clause 4 - Restriction on marketing of motor spirit
and high speed diesel - Clause 6-A - Limited
purpose of direct sale of bio-diesel blending with
high speed diesel - Clause 7 - Power of search and
seizure - Clause 8 - Sampling of Product and
testing - Clause 9 - Power of Central Government
to issue directions - Clause 10 - Overriding effect .

Petitioner running retail outlet - no permission
in terms of Clause 6-A of the Control Order -
guidelines contained in the Government Order
dated 27.10.2016 not followed - retail outlet of
the petitioner inspected - found that stocks
contained in the underground tank adulterated
with kerosene oil - F.I.R. lodged against the
petitioner under Section 420 IPC read with
Section 3/7 Essential Commodities Act, 1955 -
bio-diesel retail centre of the petitioner sealed -
provisions of the MS-HSD Order, 2005 as
amended by the Amendment Order 2017 and
guidelines under the Government Order dated
27.10.2016 contravened - powers of search and
seizure exercised by the respondent authorities
as per the provisions of Clause 7 of the MS-HSD
Order, 2005 cannot be faulted with - direction to
the respondent to open the seal of the retail
centre of the petitioner and not to interfere in
its functioning. (Para - 5,38,40)

HELD: - Quashing of the sealing order and
opening of the seal of the underground tank of
the retail unit of the petitioner cannot be
granted at this stage. (Para - 41)

Petition dismissed. (E-7)

List of Cases cited: -

1. Indian Oil Corporation Limited Vs U.O.I.,
(2013) 2 CHN 662

(Delivered by Hon'ble Dr. Yogendra
Kumar Srivastava, J.)

1. Counter affidavit filed on behalf of
the third respondent by the learned
9 All. Vishnu Kumar Vs. State of U.P. & Ors.
627
Additional Chief Standing Counsel is taken
on record.

2. Counsel for the petitioner waives
his right to file a rejoinder affidavit.

3. As jointly agreed by counsel for the
parties the writ petition is taken up for
disposal as per the Rules of the Court.

4. Heard Sri Ankit Agarwal, learned
counsel for the petitioner and Sri Pranav
Ojha, learned Additional Chief Standing
Counsel
appearing
for
the
State
respondents.

5. The present petition has been filed
seeking quashing of a sealing order which
is stated to be undated and in pursuance of
which the bio-diesel retail centre of the
petitioner has been sealed. A further prayer
has been made for a direction to the
respondent to open the seal of the retail
centre of the petitioner and not to interfere
in its functioning.

6. The facts as pleaded in the writ
petition are that the petitioner is engaged in
the business of retail sale of bio-diesel
since the year 2017 and since bio-diesel is
not a petroleum product no clearance of
any sort is required for its storage and
handling. It has been stated that the
officials of the District Supply Office,
Aligarh are continuously harassing the
petitioner and an F.I.R. was maliciously
lodged on 31.08.2019 under Section 420
IPC read with Section 3/7 Essential
Commodities Act, 1955 at P.S. Gonda,
District
Aligarh
and
thereafter
the
respondents have proceeded to illegally
seal the bio-diesel pump of the petitioner. It
is submitted that no copy of the sealing
order has been supplied to the petitioner
and the entire proceedings are in gross
violation of the principles of natural justice
and are legally unsustainable.

7. A supplementary affidavit has also
been filed by the petitioner reiterating the
assertion that bio-diesel is not a petroleum
product and no clearance is required for its
storage and handling; however, reliance is
sought to be placed on the provisions
contained under the Motor Spirit and High
Speed Diesel (Regulation of Supply,
Distribution
and
Prevention
of
Malpractices) Order, 20051 to contend that
the search and seizure operations carried
out by the respondent authorities at the
retail outlet of the petitioner are contrary to
the provisions contained under Clause 7 of
the aforesaid Order.

8. Per contra, learned Additional
Chief Standing Counsel appearing for the
State respondents placed reliance upon the
counter affidavit filed on behalf of the
respondent no. 3 to contend that the
petitioner was operating the retail outlet
without any valid licence or permission for
storage and sale of diesel/motor spirit/biodiesel. The assertion made by the petitioner
that no licence is necessary for storage and
sale of bio-diesel has been denied. It has
been stated that as per the provisions
contained under the MS-HSD Order, 2005,
as amended in terms of the Amendment
Order of the year 2017, Clause 6-A has
been inserted and in terms thereof the sale
of bio-diesel has also been brought under
its purview. Further reliance has been
drawn to a Government Order dated
27.10.2016 containing certain guidelines
with regard to grant of No Objection for the
purposes of sale/purchase and storage of
bio-diesel. It has been submitted that the
aforementioned Government Order though
was issued in the context of grant of
approval to a particular applicant but the
628 INDIAN LAW REPORTS ALLAHABAD SERIES
said Government Order was thereafter
circulated by the State Government vide D.O.
Letter dated 13.04.2017 to all District
Magistrates/District Supply Officers in the
State of Uttar Pradesh for taking appropriate
action pursuant thereto. Accordingly, it is
submitted that the guidelines contained in the
Government Order dated 27.10.2016 are
applicable with regard to the grant of No
Objection/approval for sale/purchase and
storage of bio-diesel in the State of Uttar
Pradesh.

9. Learned counsel appearing for the
State respondents further submits that the
petitioner was running the retail outlet
without necessary permission and upon an
inspection made by the Supply Inspector
several irregularities were noticed and
accordingly an F.I.R. was lodged against
the petitioner on 31.08.2019. As regards the
sealing of the retail outlet it is submitted
that the same was done after due
information to the petitioner and a copy of
the sealing order dated 29.08.2019 has also
been placed on record as annexure C.A.3 to
the counter affidavit which discloses that
during
an
inspection
made
by
the
authorities on 29.08.2019 the papers with
regard to the sale and storage could not be
produced and accordingly the under ground
tank of the retail outlet was sealed.

10. Rival submissions fall for
consideration.

11. The Essential Commodities Act,
1955 was enacted in the interests of the
general public, for the control of the
production, supply and distribution of, and
trade
and
commerce,
in
certain
commodities.

12. In terms of Section 3 of the
aforesaid Act, the Central Government is
empowered to control the production,
supply, distribution, etc., of essential
commodities and in its terms if the Central
Government is of the opinion that it is
necessary or expedient so to do for
maintaining or increasing supplies of any
essential commodity or for securing their
equitable distribution and availability at fair
prices or for securing any essential
commodity for the defence of India or the
efficient conduct of military operations, it
may, by order, provide for regulating or
prohibiting the production, supply and
distribution
thereof
and
trade
and
commerce therein. The order to be made in
exercise of powers under Section 3 may
interalia provide for regulating by licenses,
permits or otherwise the storage, transport,
distribution, disposal, acquisition, use or
consumption of, any essential commodity.
Section 7 provides for the penalties if any
person contravenes any order made under
Section 3.

13. In exercise of power conferred by
Section 3 of the Essential Commodities
Act, 1955 the Central Government notified
the MS-HSD Order, 2005 by means of a
notification dated 19th December, 2005 in
supersession of the earlier Control Order of
1998.

14. The expressions "high speed
diesel" and "motor spirit" which are sought
to be regulated in terms of the MS-HSD
Order, 2005 have been defined as follows :-

"2.(e)"High Speed Diesel" means
any hydrocarbon oil, excluding mineral
colza oil and turpentine substitute, which
meets the requirements of Bureau of Indian
Standards Specification Number IS-1460.

(g)"Motor Spirit" means any
hydrocarbon oil, excluding crude mineral
oil, which meets the requirements of
9 All. Vishnu Kumar Vs. State of U.P. & Ors.
629
Bureau of Indian Standards Specification
Number IS-2796;

15. The definitions of certain other
expressions as defined under the MS-HSD
Order, 2005, which would be relevant for
the purposes of controversy involved in the
present case,are being extracted below :-

"2(k) "product" means motor
spirit and high speed diesel;

2(p)
"unauthorized
purchase"
means purchase of the product from
sources other than those authorized by the
oil companies;

2(q) "unauthorized sale" means
sale of product by a dealer or consumer to
another dealer or consumer or to any other
person in contravention of the directive
issued for the purpose by the State
Government or the oil companies or in
contravention of any provision of this
order;

2(r) "unauthorized possession"
means keeping of motor spirit or high
speed diesel or any petroleum product or its
mixture, in contravention of the provisions
of this order, under the control of dealer or
any other person without valid sales
documents issued by the concerned oil
company."

16. As to what would constitute
malpractices, has also been specified in the
following terms :-

"2
(f)
"Malpractices"
shall
include the following acts of omission and
commission in respect of motor spirit and
high speed diesel-

(i) adulteration

(ii) pilferage

(iii) stock variation

(iv) unauthorized exchange

(v) unauthorized purchase

(vi) unauthorized sale

(vii) unauthorized Possession

(viii) overcharging

(ix)
sale
of
off-specification
product; and

(x) short delivery;

(f1) "marker" means a chemical
substance
approved
by
the
Central
Government from time to time for blending
in kerosene and other petroleum products
with the objective of preventing their
diversion or adulteration of motor spirit or
high speed diesel;"

17.

The
product
supply
and
transportation is dealt within the Clause
3(1) of the Order of 2005. Clause 3(4) of
the Order of 2005 provides no person other
than the dealer or Oil Company shall be
engaged in the business of selling product.
Clause 3(5) provides no person shall sell or
agree to sell any petroleum product or its
mixture other than motor spirit or high
speed diesel or any other fuel authorized by
the Central Government in any form, under
any name, brand or nomenclature, which
can be and is meant to be used as fuel in
any type of automobile vehicles fitted with
spark ignition engines or compression
ignition engines. The relevant provisions
are extracted below:-

"Clause 3(4): No person other
than the dealer or oil company shall be
engaged in the business of selling product;

Clause 3(5): provides no person
shall sell or agree to sell any petroleum
product or its mixture other than motor
spirit or high speed diesel or any other fuel
authorized by the Central Government in
any form, under any name, brand or
nomenclature, which can be and is meant to
be used as fuel in any type of automobile
vehicles fitted with spark ignition engines
or compression ignition engines."
630 INDIAN LAW REPORTS ALLAHABAD SERIES

18. Clause 3(6) provides no dealer,
transporter, consumer or any other person shall
indulge in any manner in any one or more of
the malpractices. The expression "malpractices"
has been defined in Clause 2(f) as including the
following acts of omission and commission in
respect of motor spirit and high speed diesel
namely adulteration, pilferage, unauthorized
exchange, unauthorized purchase, unauthorized
sale, unauthorized possession, over-charging,
sale of off specification product and short
delivery. Clause 3(7) provides that the delivery
or sale of motor spirit and high-speed diesel
shall be made by a dealer of oil company only
from authorised retail pump outlet. Clause 5
deals with grant of authorization to market
motor
spirit
and
high
speed
diesel.
Authorization has to be issued on an application
to be submitted to the Central Government in
the prescribed form.

19. Clause 4 of the MS-HSD Order,
2005
provides
for
a
restriction
on
marketing of motor spirit and high speed
diesel and the same is in the following
terms :-

"4. Restriction on marketing of
motor spirit and high speed diesel :- No
person, other than those authorised by the
Central Government, shall market and sell
motor spirit or high speed diesel to
consumers or dealers."

20. Clause 6 of the order of 2005
enables the Central Government to issue an
order to make it mandatory to supply motor
spirit and high speed diesel blended with a
specified quantity of anhydrous ethanol
and/or bio-diesel in the whole or any part
of the territory of a State or whole of the
territory of Union of India.

21. The provision with regard to grant
of permission by the Central Government
for sale of bio-diesel (B-100) for a limited
purpose as a blend with high speed diesel
to bulk consumers in accordance with the
standards specified by Bureau of Indian
Standards, was provided for by insertion of
Clause 6-A in the MS-HSD Order, 2005 in
terms of Notification No. G.S.R. 621 (E),
dated August 10, 2015 published in the
Gazette on the same date. Clause 6-A as
inserted
in
terms
of
the
aforesaid
notification dated 10th August, 2015 is
being reproduced below:-

"6-A. Limited purpose of direct
sale of bio-diesel blending with high
speed diesel - (1) The Central Government
may permit the sale of bio-diesel (B-100)
for blending with high speed diesel to bulk
consumers,
in
accordance
with
the
standards specified by Bureau of Indian
Standards, Namely -

(i) the Railways;

(ii)
the
State
Transport
Undertaking; and

(iii) other bulk consumers having
minimum requirement of bio-diesel for
their own consumption by a tank truck load
supply which shall not be less than twelve
thousand litres.

(2) For the purposes of clause (1),
" oil company" means the Indian Oil
Corporation
Limited,
the
Hindustan
Petroleum Corporation Limited, the Bharat
Petroleum Corporation Limited, any private
bio-diesel manufacturers, the authorised
dealers of such oil companies and Joint
Ventures of Public Sector Oil Marketing
Companies authorised by the Central
Government."

22. The power of search and seizure
has been provided for in terms of Clause 7
of the MS-HSD Order, 2005 and in its
terms the officer authorised is empowered
interalia to take sample of the product and
9 All. Vishnu Kumar Vs. State of U.P. & Ors.
631
seize any of the stocks of the product and
the vehicle or receptacle or any other
conveyance used or suspected to be used
for carrying such stocks. In terms of Clause
8 it is provided that the authorised officer
under Clause 7 is to take sample of the
product and thereafter to forward the same
for laboratory analysis mentioned under
Schedule III of the MS-HSD Order, 2005
or to any other such laboratory which may
be notified for the purpose. The laboratory
thereafter is required to furnish its report to
the authorised officer within 20 days of
receipt of sample whereupon the authorised
officer would be required to communicate
the result to the dealer concerned. For ease
of reference the provisions contained under
Clause 7 and Clause 8 of the MS-HSD
Order, 2005 are being extracted below:-

"7.
Power
of
search
and
seizure.--(1) Any Gazetted Officer of the
Central Government or a State Government
or any police officer not below the rank of
Deputy Superintendent of Police duly
authorised, by general or special order of
the
Central
government
or
a
State
Government, as the case may be, or any
officer of the oil company, not below the
rank of sales officer, may, with a view to
securing compliance with the provisions of
this order, or for the purpose of satisfying
himself that this order or any order made
thereunder has been complied with or there
is reason to believe that all or any of the
provisions of this order have been and are
being or are about to be contravened,--

(a) enter and search any place or
premises of a dealer, transporter, consumer
or any other person who is an employee or
agent of such dealer or transporter or
consumer;

(b) stop and search any person or
vehicle or receptacle used or intended to be
used for movement of the product;

(c) take samples of the product
and seize any of the stocks of the product
and the vehicle or receptacle or any other
conveyance used or suspected to be used
for carrying such stocks and thereafter take
or authorise the taking of all measures
necessary for securing the production of
stocks or items so seized before the
Collector or District Magistrate having
jurisdiction under the provisions of the
Essential Commodities Act, 1955 and for
their safe custody pending such production;

(d) inspect, seize and remove
with, such aid or assistance as may be
necessary, books, registers, any other
records or document of the dealer,
transporter, consumer or any other person
suspected to be an employee or agent of the
dealer, transporter or consumer;

(2) While exercising the power of
seizure provided under sub-clauses (c) and
((d) above, the authorised officer shall
record in writing the reasons for doing so
and a copy of such recording shall be
provided
to
the
dealer,
transporter,
consumer or any other concerned person, as
the case may be.

(3) The provisions of Section 100
of the Code of Criminal Procedure, 1973 (2
of 1974), relating to search and seizure
shall, as far as may be, apply to searches
and seizure under this order.

8. Sampling of Product and
testing.--(1-A)
The
authorized
officer
under clause 7 shall draw the sample from
the tank, nozzle, vehicle or receptacle, as
the case may be, in the test kit and test the
product with the aid of test kit, to check
whether the product contains any traces of
marker. If such traces are found in the
product, the authorized officer shall record
the same in triplicate which shall be jointly
signed by him and the dealer or transporter
or concerned person or his representative,
as the case may be, and give one copy of
632 INDIAN LAW REPORTS ALLAHABAD SERIES
such recording to the dealer or transporter
or concerned person or his representative
and another copy to the oil company
concerned, as the case may be."

(1) The authorized officer under
Clause 7 shall draw the sample from the
tank, nozzle, vehicle or receptacle as the
case may be, in clean aluminum containers,
to check whether density and other
parameters of the product conform to the
requirement of Bureau of Indian Standard
Specification Numbers IS 2796 and IS
1460 for motor spirit and high speed diesel
respectively. Where samples are drawn
from retail outlet, the relevant tank-truck
sample retained by the dealer as per Clause
3(b) would also be collected for laboratory
analysis.

(2) The authorized officer shall
take and seal six samples of 1 litre each of
the motor spirit or three samples of 1 litre
each of the high speed diesel. Two samples
of motor spirit or one of high speed diesel
would be given to the dealer or transporter
or
concerned
person
under
acknowledgment
with
instruction
to
preserve the sample in his safe custody till
the testing or investigations are completed.
Two samples of motor spirit or one of the
high speed diesel shall be kept by the
concerned oil company or department and
the remaining two samples of Motor Spirit
or one of High Speed Diesel would be used
for laboratory analysis.

(3) The sample label shall be
jointly signed by the authorised officer who
has drawn the sample, and the dealer or
transporter or concerned person or his
representative and the sample label shall
contain information as regards the product,
name of retail outlet, quantity of sample,
date, name of the authorized officer, name
of the dealer or transporter or concerned
person or his representative;

(4) The authorised officer shall
forward the sample of the product taken
within ten days to any of the laboratories
mentioned in Schedule III or to any other
such laboratory when it may be notified by
the Government in the Official Gazette for
this purpose, for analysing with a view to
checking whether the density and other
parameters of the product conform to the
requirements of Bureau of Indian Standard
Specification Numbers IS 2796 and IS
1460 for motor spirit and high speed diesel
respectively.

(5) The laboratories mentioned in
sub-clause (4) shall furnish the test report
to the authorised officer within twenty days
of receipt of sample at the laboratory."

23. The Central Government through
its Ministry of Petrol and Natural Gas
subsequently issued a notification dated
29.06.2017 in terms of G.S.R. 728(E), in
exercise of powers conferred by Section 3
of the Essential Commodities Act, 1955 to
further amend the MS-HSD Order, 2005,
and in its terms Clause 6A has been
substituted. For ready reference G.S.R.
728(E) as notified on 29.06.2017 is being
extracted below:-

"MINISTRY OF PETROLEUM AND
NATURAL GAS
NOTIFICATION
New Delhi, the 29th June, 2017

G.S.R. 728(E),--In exercise of the
powers conferred by section 3 of the
Essential Commodities Act, 1955, (10 of
1955), the Central Government hereby
makes the following Order further to
amend the Motor Spirit and High Speed
Diesel (Regulation of Supply, Distribution
and Prevention of Malpractices) Order,
2005, namely:--

1. (1) This Order may be called
the Motor Spirit and High Speed Diesel
9 All. Vishnu Kumar Vs. State of U.P. & Ors.
633
(Regulation of Supply, Distribution and
Prevention of Malpractices) Amendment
Order, 2017.

(2) It shall come into force on the
date of its publication in the Official
Gazette.

2. In the Motor Spirit and High
Speed Diesel (Regulation of Supply,
Distribution
and
Prevention
of
Malpractices) Order, 2005, for clause 6A,
the following clause shall be substituted,
namely :--

"6A(1) The Central Government
may permit the direct sale of bio-diesel (B100) for blending with high speed diesel to
all consumers, in accordance with the
specified blending limits and the standards
specified
by
the
Bureau
of
Indian
Standards.

(2) The owner of every outlet
selling bio-diesel (B-100) shall prominently
display at the place of business the
permissible
limits
specified
by
the
manufacturers of vehicles and the standards
specified by the Bureau of Indian Standards
for blending of bio-diesel (B-100) for use
of consumers in their vehicles.

Explanation.--For the purpose of
this clause, oil company means the Indian
Oil Corporation Limited, the Hindustan
Petroleum Corporation Limited, the Bharat
Petroleum Corporation Limited, any private
bio-diesel manufacturers, the authorized
dealer of such oil companies and joint
vehicles of public sector oil marketing
companies authorised by the Central
Government."

[F. No. P-11013/1/2015-Dist.]

ASHUTOSH JINDAL, Jt. Secy.

Note : The principal Order was
published
in
the
Gazette
of
India,
Extraordinary, Part II, Section 3, Subsection (i) vide number G.S.R. 729(E),
dated the 19th December, 2005 and
subsequently
amended
vide
number
G.S.R.18(E), dated the 12th January, 2007,
number G.S.R.1(E), dated the 1st January,
2009, number G.S.R.352(E) dated the 6th
May, 2014 and number G.S.R. 621(E)
dated the 10th August, 2015"

24. Clause 6A(1) of the MS-HSD
Order, 2005 as amended in terms of the
Amendment Order, 2017 empowers the
Central Government to grant permission for
direct sale of bio-diesel (B-100) for
blending with high speed diesel to all
consumers in accordance with the specified
blending limits and the standards specified
by the Bureau of Indian Standards. In terms
of sub-clause (2) of Clause 6A the owner of
every outlet selling bio-diesel is required to
prominently display at the place of business
the permissible limits specified by the
manufacturers of vehicles and the standards
specified by the Bureau of Indian Standards
for blending of bio-diesel (B-100) for use
of consumers. The Explanation appended
to Clause 6-A provides that the expression
"oil company" for the purposes of Clause
6-A would include any private bio-diesel
manufacturer also.

25. It therefore follows that the direct
sale of bio-diesel (B-100) for blending with
high speed diesel is permissible as per
terms of Clause 6-A (as amended in terms
of G.S.R 728(E), notified on 29th June,
2017), after grant of permission by the
Central Government. The Explanation
appended to Clause 6-A provides that for
the purposes of this Clause the expression
"oil company" would include any private
bio-diesel manufacturer also.

26. It may also be taken note of that
as per the terms of Clause 9 of the MSHSD Order, 2005 the Central Government
has been empowered to issue directions to
any dealer, transporter, consumer or any
634 INDIAN LAW REPORTS ALLAHABAD SERIES
other
person
regarding
storage,
sale
transportation and disposal of motor spirit
or high speed diesel and upon issuance of
such directions, the dealer, transporter or
consumer shall be bound to comply the
same. Clause 10 of the MS-HSD Order,
2005 contains a non-obstante clause and
gives an overriding effect to the provisions
of the Control Order. For ease of reference,
Clause 9 and Clause 10 are being extracted
below:-

"9.
Power
of
Central
Government to issue directions - The
Central Government may, from time to
time, by a general or special order issue to
any dealer, transporter or consumer or any
other person, such directions as it considers
necessary
regarding
storage,
sale
transportation and disposal of motor spirit
or high speed diesel and upon the issue of
such directions, such dealer, transporter or
consumer shall be bound to comply
therewith.

10. Overriding effect - The
provisions
of
this
order
shall
have
overriding effect notwithstanding anything
to the contrary contained in any order made
by a State Government or by an officer of
such
State
Government
before
the
commencement of this order except as
respects anything done or omitted to be
done
thereunder
before
such
commencement."

27. It is therefore seen that the direct
sale of bio-diesel is permissible in terms of
Clause 6-A of the MS-HSD Order, 2005
for blending with high speed diesel and as
per the terms specified therein would be
subject
to
the
regulatory
conditions
provided for under the MS-HSD Order,
2005. The powers of search and seizure
would accordingly be available to the
authorised officers with a view to securing
compliance of the provisions of the Control
Order 2005 or where there is reason to
believe that any of the provisions of the
control order have been, are being or are
about to be contravened.

28. In the case at hand it is admitted
position that the petitioner has not obtained
any permission for the purposes of running
the retail outlet for sale of bio-diesel. In
fact the petitioner has sought to assert that
no such permission is required for the
purpose. The contention raised by the State
authorities in their counter affidavit that the
provisions contained under the Control
Order 2005 as amended in terms of the
Amendment Order of the year 2017, more
particularly the provisions contained under
Clause 6-A, having been contravened, has
not been controverted by the petitioner.

29. The petitioner has in his
supplementary affidavit himself sought to
place reliance upon the MS-HSD Order,
2005 so as to contend that the provisions
with regard to search and seizure under its
Clause
7
were
not
followed.
The
applicability of the provisions of the MSHSD Order 2005 to the retail outlet being
run by the petitioner has therefore not been
disputed by him.

30. It is not disputed that upon
information received by the authorities with
regard to certain malpractices the retail
outlet was inspected and it was found that
the stocks contained in the under ground
tank were being adulterated with kerosene
oil and accordingly an F.I.R. dated
31.08.2019
was
lodged
against
the
petitioner under Section 420 IPC read with
Section 3/7 Essential Commodities Act,
1955, wherein it has been stated that the
provisions of the MS-HSD Order, 2005 as
amended by the Amendment Order 2017
9 All. Vishnu Kumar Vs. State of U.P. & Ors.
635
and
also
the
guidelines
under
the
Government Order dated 27.10.2016 had
been contravened.

31. The averments in this regard as
contained in the counter affidavit dated
27.11.2019
filed
on
behalf
of
the
respondent no. 3, which have not been
controverted by the petitioner, are being
extracted below :-

"3.
On
29.08.2019
on
the
directions of Sub-Divisional Magistrate
Iglas the Supply Inspector Iglas Aligarh
along with police of police station Gonda
raided the premises of the petitioner and
found
that
a
pick-up
Van
bearing
Registration No. U.P. 81 C.T. 3508 was
parked there and contained 220 liters of
diesel and 9 empty plastic drums were kept
near the underground tank. By using diprod the underground tank contained 19919
liters Petroleum. The stock register was not
made available and as such the actual
variation in stock could not be ascertain.
Three samples of petroleum products kept
in the drum were taken and put on see and
same were sent to the laboratory. The
workers of the firm present could not
explain about installation of the pump and
sale and purchased of the petroleum
products and told that the papers are with
the owner. The raiding team waited for
long time but neither the owner appeared
nor sent the documents relating to the
aforesaid filing station and thereafter in
violation of Govt. order No. 454/29-072016 Bio-diesel (1)/2016 dated 27.10.2016
the firm of the petitioner was sealed so that
there may be no further misuse of
Petroleum product.

5. In fact the petitioner has no
license for storage and sale of diesel/motor
spirit/bio-diesel. It is also denied that no
license is necessary for storage and sale of
bio-diesel, in fact motor spirit and high
speed diesel (Supply Distribution) (Apurti,
Vitran ka Viniyam Aur Kadacharo ke
Rogdham), 2005 (Amended Order 2017)
Section 6A (1)(2) Bio-diesel has also been
included under Essential Commodities Act.
The photo stat copy of the said Govt. order
is being filed as Annexure No. C.A.1 to
this counter affidavit and thereafter the
Govt. order dated 27.10.2016 regarding
purchased and sale of bio-diesel and its
storage is being filed as Annexure
No.C.A.2 to this counter affidavit."

32. The conditions specified under the
Government Order dated 27.10.2016 for
the purposes of grant of No Objection for
the sale/purchase and storage of bio-diesel,
are as follows :-

"1&ck;ksMhty ds dz;&fodz; ,oa
Hk.Mkj.k LFkku dks lkoZtfud :i ls ?kksf"kr fd;k
tk;sxk] ftldh vuqefr tuin Lrj ij lacaf/kr
ftykf/kdkjh }kjk nh tk;sxhA

2& ck;ksMhty laca/kh LVkd o fcdzh
jftLVj cuk;k tk;sxk] ftls l{ke vf/kdkjh ds
fujh{k.k ds le; vfuok;Zr% izLrqr fd;k tk;sxkA

3& ck;ksMhty dh izkfIr dk lzksr
?kksf"kr fd;k tk;sxk] ftlls fdlh izdkj dh dksbZ
vfu;ferrk u gksus ik;sA

4&
ck;ksMhty
dz;&fodz;
,oa
Hk.Mkj.k ds laca/k esa foLQksVd foHkkx dk
ykbZlsUl izkIr djuk vfuok;Z gksxkA

5& vkcdkjh foHkkx] vfXu'keu foHkkx
,oa ou foHkkx 1⁄4;fn dk;Z LFky ou ds vkl&ikl
gks1⁄2 dk vukifr izek.k i= vo'; izkIr djuk
gksxkA

6& ck;ksMhty ds dz;&fodz; gsrq dS'k
eseks dk mi;ksx fd;k tk;sxk] ftlls fdlh izdkj
dh vfu;ferrk u gksus ik;sA"

33. The guidelines referred to in the
Government Order dated 27th October,
2016 with regard to the grant of No
Objection Certificate for the purposes of
636 INDIAN LAW REPORTS ALLAHABAD SERIES
sale/purchase and storage of bio-diesel
which have been circulated by the State
Government
to
all
the
District
Magistrates/District Supply Officers in the
State of Uttar Pradesh in terms of D.O.
Letter dated 13th April, 2017, have also
admittedly not been followed.

34. In furtherance of the amendment
made to the MS-HSD Order, 2005 by
Gazette Notification No. G.S.R. 728(E)
dated 29th June, 2017 in terms whereof
Clause 6A (1) empowers the Central
Government to grant permission for direct
sale of bio-diesel (B-100) for blending with
high speed diesel to all consumers, the
Central Government, has issued a Gazette
Notification dated 30.04.2019 notifying
"Guidelines for sale of Biodiesel for
blending with high speed diesel for
transportation
purposes-2019."
The
Gazette Notification dated 30th April, 2019
containing the aforementioned Guidelines
is being reproduced below :-

"MINISTRY OF PETROLEUM AND
NATURAL GAS
NOTIFICATION

New Delhi, the 30th April, 2019

F.No.P-13039(18)/1/2018-CC(P26825).--Ministry of Petroleum & Natural
Gas has issued Gazette notification No.
GSR 728 (E) on 29th June 2017 for
amending the Motor Spirit and High Speed
Diesel (Regulation of Supply, Distribution
and Prevention of Malpractices) Order
dated 19th December 2005. Clause 6 (A) 1
of the amended order states that the Central
Government may permit the direct sale of
Biodiesel (B100) for blending with high
speed
diesel
to
all
consumers,
in
accordance with the specified blending
limits and the standards specified by the
Bureau of Indian Standards.

2. In pursuance of the above, the
Central Government hereby notifies the
following guidelines for sale of Biodiesel

for blending with high speed
diesel for transportation purposes.

3. (i) These guidelines may be
called the "Guidelines for sale of Biodiesel
for blending with high speed diesel for
transportation purposes-2019."

(ii) The above guidelines shall
extend to the whole of India.

(iii) The guidelines contained
herein will come into force from the date of
their publication in the Gazette and remain
in force until further orders.

4. The text of the guidelines is
annexed.

"Guidelines for sale of Biodiesel
for blending with high speed diesel for
transportation purposes-2019"

(i). Application for permission for
retail sale of Biodiesel (B-100) through an
outlet by an entity shall be made to the
Food and Civil Supplies Department/any
other Department authorised for the same
by the State/UT Government of the
concerned State/UT, where the Retail
Outlet is to be set up.

(ii). The permission will be
granted exclusively for sale of biodiesel (B100) only and not for any mixture thereof
of whatever percentage.

(iii). Permission for setting up the
retail outlet for sale of biodiesel would be
subject to the Registration/Approvals/No
Objection Certificates as per Annexure
from the respective Central/State/UT/Local
Government/Authorities in which the retail
outlet is located and other concerned
authorities mentioned therein.

(iv). This permission will be
displayed prominently at the point of sale
of Biodiesel.

(v). Biodiesel to be sold in
pursuance of aforesaid permission should
9 All. Vishnu Kumar Vs. State of U.P. & Ors.
637
be
indigenously
produced
and
not
imported.

(vi).
Separate
boards
in
English/Hindi and Vernacular language of
the region should be prominently displayed
at the biodiesel retail outlet displaying the
percentage of Biodiesel allowed to be
blended with diesel in the customer's
automobile tank. Also, there should be
clear warning displayed at the biodiesel
retail outlet (with above board) that usage
of biodiesel with percentage exceeding the
prescribed percentage can cause damage to
the engine.

(vii).
Owner/Operator
shall
maintain the material balance along with
supplier details. The biodiesel retail outlet
owner/operator shall make available the
same at the retail outlet at all times for
inspection by any authority authorised for
the purpose either by the concerned
State/UT Government and /or Central
Government.

(viii).
Biodiesel
retail
outlet
owner/operator shall retain samples of at
least last three supplies received by them
from their suppliers for inspection and/ or
testing by any authority authorised for the
purpose, as above.

(ix). The biodiesel retail outlet
owner/operator shall maintain a permanent
record of each and every sale of biodiesel
made by it in a register which would be
updated on a daily basis and be available
for inspection at all times. Additionally
issuing of bill (in duplicate) for each sale,
clearly showing vehicle number and
customer name/contact number giving
details of quantity sold, rate charged and
date and time of sale would be mandatory.
(One copy for customer and one for Retail
Outlet record.)

(x). State Government authorities
shall have the power to carry out regular
inspections of the retail outlets selling
biodiesel to ensure that the biodiesel is
being made available to the customer in the
right quality and quantity, and is not being
sold as a standalone fuel for transportation
purposes. In case of any sample failure of
Biodiesel (B100) being sold, State/ District
Administration
shall
proceed
with
administrative action on the analogy of the
Marketing Discipline Guidelines (MDG)
for retails Outlets selling MS (Petrol) and
HSD (High Speed Diesel).

(xi). All volume and safety
distance norms applicable for Class B
Petroleum Products shall be applicable for
pumps selling Biodiesel as it is meant for
blending with High Speed Diesel which is a
Class B Petroleum Product.

(xii). To ensure that the Retail
Outlets of Biodiesel are selling only Biodiesel
conforming to BIS Standards and not mixture
of Biodiesel and Diesel or only Diesel,antiadulteration cells of Public Sector Oil
Marketing Companies along with State
Government officials are empowered to inspect,
search and seize unauthorized and unscrupulous
Biodiesel manufacturing plants, the storage and
distribution units and Retails Outlets.

(xiii). Mobile labs of Oil Industry
will also have the jurisdiction to cover
retail
outlets
selling
Biodiesel,manufacturing plants, storage and
distribution network of Biodiesel.

(xiv).
To
avoid
entry
of
unscrupulous biodiesel suppliers,a suitable
registration
system
for
biodiesel
manufactures, suppliers and sellers will be
devised at the State/UT Level. Further,
State/UT Governments shall maintain a
register of all Retail Outlets selling
Biodiesel in their respective State/UT

(xv).