# COMPANY ETC v. STATE OF ANDHRA PRADESH

- **Citation:** [1976] 3 S.C.R. 775
- **Court:** Supreme Court of India
- **Decided:** 1976-03-22
- **Bench:** A. N. Ray, M. H. Beg, Jaswant Singh
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/company-etc-v-state-of-andhra-pradesh-6829
- **Pages:** 5

## Headnote

Rici' (Andhra Pradesh) Price Control (3rd A111e11d111e111) Order 1964, clause
2-Whether refrospecti\·ity of substitution inferred i11 (lbsence of express pral'ision.
Under s. 3 of the Essential Commodities Act 1955, the respondent passed
the Andhra Pradesh Procurement (Levy) Order 1959, requiring every miller and
B
Uealer of rice (including the appellants) to sell to the
respondent
certain
C
specified varieties and quantities of rice at controlled price on requisition being
served on him.
Clause 2(a) of the Order defined "controlled price" ns the
maximum price fixed by the Central Government from time to time under s. 3
of the Act for the sale of rice.
On December 19, 1963, the Central Government passed the Rice (Andhra Pradesh) Price Control Order 1963, fixing the
maximum price of akkulu rice at Rs. 46.89 per q;.1inta1.
The appellants sold
several Quantities of akkulu rice to the respondent from January 26, 1964, to
February 21, 1964, and were paid at the controlled rate.
On March 23, 1964,
the Central Government issued the Rice (Andhra Pradesh) Price Control. (3rd
D
amendment) Order 1964, and substituted Rs. 52.28 for Rs. 46.89 3.s the maximum
price per quintal, of akkulu rice.
The appellant's claim for the -benefit of the
enhanced price for the earlier _sales was rejected by the Government of Andhra
Pradesh. The appellants succeed_ed before the Subordinate Judge, Machilipatnam,
in their suits for recovery of the difference between the two controlled prices
but lost before the High Court, in appeals preferred by the State of Andhra
Pradesh. It was contended before this Court that the prices fixed by the
Government are for the entire season, and the appellants are entitled payment
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at the amended rates, regardless of the dates when the supplies were made, and
that the word .. substitute" infers retrospective e.ffect.
Dismissing the appeals, the Court;
HELD : Jn the absence of express words or appropriate language from \Vhich
retrospectivity may be inferred. a notification takes effect from the date it is
issued and not from any prior date.
Statutes should not be construed so as to
create new disabilities or obligations or impose new duties in respect of tranF
sections which were complete at the time the Amending Act came into force.
[778B--C}
(2) The property in the goods having passed to the Government of Andhra
Pradesh on the dates the supplies were made, the appellants had to be paid
only at the controlled prices obtaining on the dates the sales were effected and
not at the increased price which came into operation subsequently. [778-0]
K.· A·p.payya Shanbhague & Co. v. The State of Mysore and Anr. (Unreported decision S.C. dated 20-4-19~2); The Union of lndia, r~presented by !he
G
Secretary, Ministry of Food & ARnculture, Gov:rnn1er1t of lndta, New ·Dellu v.
Kan11ri Dan1odariah & Co. Alluri Venkatanaras1ah (1968} 1 An. W.R. 81 and
Mani (;opal Mitra v. The State of Bihar (1969) 2 S.C.R. 411, followed.

## Text

,
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775
SRI VIJA YLAKSHMI RICE MILLS, NEW CONTRACTORS
A
COMPANY ETC.
v.
STATE OF ANDHRA PRADESH
March 22, 1976
[A. N. RAY, C.J., M. H. BEG AND JASWANT SINGH, JJ.]
Rici' (Andhra Pradesh) Price Control (3rd A111e11d111e111) Order 1964, clause
2-Whether refrospecti\·ity of substitution inferred i11 (lbsence of express pral'ision.
Under s. 3 of the Essential Commodities Act 1955, the respondent passed
the Andhra Pradesh Procurement (Levy) Order 1959, requiring every miller and
B
Uealer of rice (including the appellants) to sell to the
respondent
certain
C
specified varieties and quantities of rice at controlled price on requisition being
served on him.
Clause 2(a) of the Order defined "controlled price" ns the
maximum price fixed by the Central Government from time to time under s. 3
of the Act for the sale of rice.
On December 19, 1963, the Central Government passed the Rice (Andhra Pradesh) Price Control Order 1963, fixing the
maximum price of akkulu rice at Rs. 46.89 per q;.1inta1.
The appellants sold
several Quantities of akkulu rice to the respondent from January 26, 1964, to
February 21, 1964, and were paid at the controlled rate.
On March 23, 1964,
the Central Government issued the Rice (Andhra Pradesh) Price Control. (3rd
D
amendment) Order 1964, and substituted Rs. 52.28 for Rs. 46.89 3.s the maximum
price per quintal, of akkulu rice.
The appellant's claim for the -benefit of the
enhanced price for the earlier _sales was rejected by the Government of Andhra
Pradesh. The appellants succeed_ed before the Subordinate Judge, Machilipatnam,
in their suits for recovery of the difference between the two controlled prices
but lost before the High Court, in appeals preferred by the State of Andhra
Pradesh. It was contended before this Court that the prices fixed by the
Government are for the entire season, and the appellants are entitled payment
E
at the amended rates, regardless of the dates when the supplies were made, and
that the word .. substitute" infers retrospective e.ffect.
Dismissing the appeals, the Court;
HELD : Jn the absence of express words or appropriate language from \Vhich
retrospectivity may be inferred. a notification takes effect from the date it is
issued and not from any prior date.
Statutes should not be construed so as to
create new disabilities or obligations or impose new duties in respect of tranF
sections which were complete at the time the Amending Act came into force.
[778B--C}
(2) The property in the goods having passed to the Government of Andhra
Pradesh on the dates the supplies were made, the appellants had to be paid
only at the controlled prices obtaining on the dates the sales were effected and
not at the increased price which came into operation subsequently. [778-0]
K.· A·p.payya Shanbhague & Co. v. The State of Mysore and Anr. (Unreported decision S.C. dated 20-4-19~2); The Union of lndia, r~presented by !he
G
Secretary, Ministry of Food & ARnculture, Gov:rnn1er1t of lndta, New ·Dellu v.
Kan11ri Dan1odariah & Co. Alluri Venkatanaras1ah (1968} 1 An. W.R. 81 and
Mani (;opal Mitra v. The State of Bihar (1969) 2 S.C.R. 411, followed.
CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 805, 806
and 972~977 of 1~73
From the judgment and decree dated the 8th June 1971 and 23rd
H
November 1971 respectively of the IJ:igh Court of Andhra Pradesh
at Hyderabad in Appeal Suit Nos. 766 of 1968, 18 of 1969, 779,
780, 792 to 785 of 1968 respectively .
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776
SUPREME COURT REPORTS
(1976] 3 S.C.R.
F. S. Nariman, J. V. K. Gurunathan, T. V. Narasimhan Murty
and A. Subha Rao, for the appellants.
P. Ram Reddy and P. P. Rao, for the respondents.
The Judgment of the Court was delivered by
JASWANT SINGH, J.
This batch of Appeals Nos. 805, 806 and
972 to 977 of 1973 by certificate from the judf!IIlents and decrees of
the High Court of Andhra Pradesh in Appeals Nos. 766 ot 1968,
18 of 1969, 779 of 1968, 780 of 1968, 782 of 1968 783 of 1971
~84 of 1968 and 785 of 1968 raise a simple but an.futeresting ques~
hon namely, whether for the supplies of rice made by the appellants
m January and February, 1964, they are to be paid price according
to t!1e rate specified m the. Rice (Andhra Pradesl!) Price Control
(Third Amendme.nt) Order, 1964 dated March 23, 1964 or according
to the rate specified m the Rice (Andhra Pradesh) Price Control
<?rder as it stood in 1963.
The question arises in the following
circumstances :
The appellants are millers and carry on the business of paddy
and rice in the State of Andhra Pradesh.
On July 31, 1959, the
Governor of Andhra Pradesh in exercise of the powers conferred on
him by section 3 of the Essential Commodities Ac\, 19 5 5 (Central
Act X of 19 5 5)
hereinafter referred to as 'the Act' made an order
called the Andhra Pradesh Rice Procurement (Levy) Order, 1959.
clause 3 of the order required every dealer and every miller to sell
to the State Government on requisition served on him by the requisitioning authority at the controlled price (a) 40 per cent of the quantity
of rice held in stock by him at the· commencement of the order and
(b) 40 per cent of the total quantity of rice purchased by him every
day beginning with the commencement of the order.
Clause 2(a)
of the order defined "controlled price" as meaning the maximum price
fixed under section 3 of the Act for the sale of rice by the Central
Government from time to time (emphasis supplied).
On December
19, 1963, the Central Government in exercise of the pov.:er.conferred
on it by section 3 of the Act made an or~er called the Rice (~nd?ra
Pradesh) Price Control Order, 1963, which extended to the distncts
of Krishna, West Godavari, East Godavari, GUJ1tur, Nizarnabad, Warangal and Nellore in the State of Andhra Pradesh.
Clause (2) of the
order provided that the maximum prices at which the varieties of rice
specified in column. \ 1) of the Schedule f? tha'. Order were -to be s?ld
in wholesale quantities would be as specified m
the correspondmg
entries in column (2) of the said Schedule.
The said Schedule inter
alia provided that Akkulu rice would be sold at Rs. 46.89 ,per· quintal.
Jn compliance with the requisitions served on them by the requisitioning authority of the State of Andhra Pradesh, the appellants sold
various quantities of that variety of rice to the Government 'of that
State from January 26, 1964, to February 21, 1964, and were paid
at the aforesaid rate of Rs. 46.89 per quintal. By means·of the Rice
(Andhra Pradesh) Price Control (Second Amendment) .Qrder, 1964.
dated March 20, 1964, the Central Government amended. sub-clause
(1) of clause 2 of the Rice (Andhra Pradesh) Price Cqntrol Order,
1963 and ordained that in th¢. said. sub-clause for the )Voids "the
Schedule',· the words and figures. schedule I shall be s11b§tit].i!~d. On
_:; .. :,,
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SRl VIJAYLAKSHMI RICE MILLS v. A.P. STATE (Jaswant Singh, 1.) 777
March 23, 1964, the Central Government issued the Rice (Andhra
Pradesh) Price Control (Third Amendment) Order, 1964.
Clause 2
of the Order ran ·thus :-
2. In the Rice (Andhra Pradesh) Price Control Order, 1963, in
Schedule I, 10r the varieties of rice and che maximum prices thereafter,
the following shall be substituted namely :-
Varieties or rice
1. Districts other than Nellore
Akulu
Maximum price
per quintal.
52-25
On the issue of this order, the appellants made representations to
the Government of Andhra Pradesh requesting that for the aforesaid
supplies of Akkulu rice made by them from January 26 to February
~ 21, 1964, they should also be paid at the enhanced price of Rs. 52.25
per qumtal.
As the representations made by them did not evoke a
favourable response, they filed suits in the Court of the Subordinate
Judge, Machilipatnam for recovery of the difference between the controlled prices specified in the Rice (Andhra Pradesh) Price Control
Order, 1963, dated December 19, 1963 and Rice (Andhra Pradesh)
, Price Control (Third Amendment) Order, 1964.
The
suits
filed
by them were decreed by that Court. Aggrieved by these judgments
and decrees,
the State of Andhra Pradesh preferred appeals to the
High Court at Hyderabad which were allowed on the ground that
as the supplies ot rice were made by the appellants before the Rice
(Andhra Pradesh) Price Control (Third Amendment) Order, 1964,
they were entitled only to the price specified in the Schedule to the
Rice ( Anhdra Pradesh) Price Control Order, 1963. Dissatisfied with
these judgments and decrees, the appellants applied for
certificate
under Article 133(1) (a) of the Constitution which was granted to
them.
The sole question for determination in these appeals, as already
indicated, is whether the appellants were to be paid price for the supplies to rice made by them from January 26, 1964, to February 21,
1964, at the rate of Rs. 46.89 per quintal-the rate specified in the
Rice (Andhra Pradesh) Price Control Order, 1963, dated December
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19, 1963 or at the enhanced rate of Rs. 52.25 per quintal as fixed by
the Rice (Andhra Pradesh) Price Control (Third Amendment) Order,
G
1964 dated March 23, 1964.
Mr. Narirnan appearing on behalf of the appellants has laid great
emphasis on the word "substituted" occurring in clnase 2 of the Rice
(Andhra Pradesh) Price Control (Third Amendment) Order. 1964
and has nrged that the claim of the appellants carrot be validity ignored.
Elaborating his submission. counsel has contended that as the nrices
fixed by the Government are meant for the entire season, the appellants
have to be paid at the controlled price as fixed vide the Rice ( Andhra
Pradesh) Price Control (Third Amendment) Order, 1964, regardless
17-608SCI/76
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778
SUPREME COURT REPORTS
Ll 976] 3 S.C.R.
of the dates on which the supplies were made.
We cannot accede to
this contention. It is no doubt true that the literal meaning of the
word "substitute" is "to replace' but the question before us is trom
which date the substitution or replacement of the new Schedule took
effect. There is no deeming clause or some such provision in the Rice
(Andhra Pradesh) Price Control (Third Amednment) Order, 1964 to
indicate that it was intended to have a retrospective effect.
It is
a
well recognized rule of interpreation that in the absence of express
words or appropriate language from which retrospectivity may be
inferred, a notification takes effect from the date it is issued and not
from any prior date.
The principle is also well settled that statutes
should not be construed so as to create new disability or obligations
or impose new duties in respect of transactions which were complete
at the time the Amending Act came into force.
(See Mani Gopa/
Mitra v. The State of Bihar (1).
The aforesaid sales in the instant cases having been made by the
appellants before the coming into force of the Rice (Andhra Pradesh)
Pnce Control (Third Amendment) Order, 1964, and the property in
the goods having passed to the Government of Andhra Pradesh on
the dates the supplies were made, the appellants had to be paid only
at the controlled price obtaining on the dates the sales were effected
and not at the increased price which came into operation subsequently.
This view is in consonance with the provisions of section 3 of the Act
and the Andhra Pradesh Rice Procurement (Levy) Order, 1959 which
clearly indicate that the price payable to the dealers
and
Millers
for the supplies of rice made by them is the control price obtaining on
the date when the sale is made. Similar view is taken in the unreported decision dated Apr;! 20, 1962 of this Court in K. Appayya Shambhague and Co. v. The State of Mysore & Anr.(') where it was laid
down that the order made under section 3 (2) (f) of the Act are offers
of sale which the person on whom a requisition is served has no option
but to accept and that the price that has to be paid is the controlled
price fixed by the Government under section 3(2) (c) of the Act on
the date when he goods are ascertained or when the property in the
goods passes to the buyer.
This decision was followed by the High
Court of Andhra Pradesh in The Union of lndia, represented
by
the Secretary, Ministry of Food and
Aericulture.
Government of
lndia, New Delhi v. Kanuri Damodariah & Co. Alluri Venkatanarasiah
("J where it was held that an order nnder section 3(2) (f) am01mts
to an agreement for sale and the price oavable for the quantities of
rice supplied is a price payable in accordance with the price notified
under the provisions of section 3 (3) of the Act.
In the instant cases, the sale having been made before the coming
into force of the Rice I Andhra Pradesh) Pr're r'nntrol (Third Amendment) Order, 1964, the appellants cannot iustifiablv claim the benefit of the increased price specified in the Rice (Andhra Pradesh) Price
Control (Third Amednment) Order, 1964.
The acceptance of the
(1) [1969! 2 S.C.R. 411.
(2) Unreported case(S.C.) dt. 20-4-1962.
(J) [1968J 1 An. W.R. 81.
...
,.
SHI VIJAYLAKSHMI RICE MILLS v. A.P. SIAIE (Jaswant Singh, J.)779
contention raised on behalf of the appellants will lead to i:;rave conA
sequences. It will have the effect of reopening the transactions past
I
and closed and would thus give rise to lots of difficulties.
,.i
Mr. Nariman has, in support of his contention, relied on the follow-
;
ing passage occurring at p. 394 in Craies on Statute Law
(Sixth
Edition) :-
.)'
..
"Explanatory and declaratory Acts retrospective
Where a Statute is passed for the purpose of supplying
an obvious omission in a former statute, or, as
Parke J.
(afterwards Baron Parke) said in R. V. Dursley (1832) 3
B. & Ad. 465, 469 "to 'explain a former statute," the subsequent statute has relation back to the time when the prior
Act was passed.
Thus in Att.-Gen v. Poughtt (1816) 2
Price 381, 392, it appeared that by a Customs Act of 1873
(53 Geo. 3, c.33) a duty was imposed upon hides of 9s.
4d., but the Act omitted to state that it was to be 9s. 4d. per
cwt., and to remedy this omission another Customs Act
53 Geo. c. 105) was passed later in the same year. Between
the passing of these two Acts some hides were exported, and
it was contended that they were not liable to pay the duty
9s. 4d. per cwt., but Thomson C. B., in giving judgment
for the Attorney-General, said : "The duty in this instant
was in fact imposed by the first Act, but the gross mistaks
of the omission of the weight for which the sum expressed
was to have been payable occasioned the amendment made by
the subsequent Act. but that had reference
to the former
statute as soon as it pas,ed, and they must be taken together
as if they were one and the same Act."
Where an Act is in its nature declaratory, the presumption against construing it retrospectively is inapplicable.'
This passage has, in our opinion. no bearing on the question before us in view of the fact that the Rice (Andhra Pradesh) Price Control (Third Amendment) Order, 1964 is neither explanatory nor
declaratory, as sought to be interpreted by the counsel.
The contention of Mr. Nariman that the controlled prices fixed by
the Central Government for sale of rice are seasonal prices not being
based upon any cogent material cannot also be accepted.
The High Court was, therefore, right in allowing the aforesaid
appeals preferred by the respondent and reversing the .iudgment and
decrees passed by the Subordinate Judge, Machilipatnam.
Jn the result, the appeal, fail and are dismissed with cost, limited
to one set.
M.R.
Appeals dismissed .
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