# THREE OTHERS v. THE STATE OF UTTAR PRADESH AND

- **Citation:** [1955] 1 S.C.R. 838
- **Court:** Supreme Court of India
- **Decided:** 1952-05-15
- **Bench:** Mehr Chand Mahajan C.J, s. R. DAS, Ghula~I Hasan, Bhagwati, Jagannadhadas
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/three-others-v-the-state-of-uttar-pradesh-and-1206
- **Pages:** 12

## Headnote

Uttar Pradesh Food-grains (Futures and Options Prohibition)
Order, 1951-Uttar Pradesh Food-grains (Futures and Options
Prohibition) Order, 1945-Restrictfons on dealings in pulses other
thangram,....:.1,. both orders-Order o/'1951 partlu declared ultra
vires by Supreme Court-Not so s. 9 thereof which repealrd Order of
-1945-Whether Order of 1945 still fo force-Proper procedure for
' clarification of the matter • .
Uttar Pradesh Food-grains (Futures and Options Prohibition)
Order, 1951, made it illegal and a punishable offence for any
· person to enter into any fntures in pulses other than gram, or to
pa.y or receive or to agree to pay or receive a.ny margin rel.a.ting to
such futures. Bys. 9 of that Order the Order of 1945·conlaining .
similar provisions was repealed. An application qnd~r Art. S2 of
•
s.c.R.
SUPREl\IE COURT REPORTS
839
the Constitution presented by several persons (including the
z954
present petitioners) for the enforcement of their fundamental right
under Art. 19(l)(g) of the Constitution to carry on their business The Chamber of
and restraining the State from enforcing the Order of 1951 in so Commerce,Hapur.
far as it related to· pulses other than gram and for a declaration and three Others
that s. 2(o) of the Order read with items 6, 7, 8 and 9 of the
v.
schedule thereto was illegal and ultra vire1 the State Government
The State of
succeeded in the Supreme Court and . the State of Uttar Pradesh Uttar Pradesh
was directed by the Supreme Court by its judgment dated the 15th. and two Others
1Iay, 1952, to abstain from giving effect to it.
On the 10th June, l953, a lett~r (Exhi.bit B to th~ petition)
was addressed by the Deputy Commissioner, Food, Uttar Pradesh,
to all Regional Food Controllers and Deputy Food Controllsrs and
all District Magistrates in Uttar Pradesh instructing them to
regard all futures in foodgrains mentioned in the Schedule to the
1945 Order including pulses other than gram as punishable. ·· -
It was contended on behalf ~f the State (i) .that section 3 of 1946
Act which reproduced s. 3 of the 1946 Ordinance conferred on the
Central Goverllment ! extensiTe powers to· control production,- -
supply. distribution of and trade and commerce-· in 0ssentia1
commodities and this power was delegated by the Central Govern'.
ment to the Provincial Government by notification dated 21st
October, 1946, under s. 4 of the 1946 Ordinance. ·The subsequent
amendments made by two Notifications dated 5th March, 1947,
and dated 15th November, 1947, withdrew the power so delegated
only with respect to "edible oils and oil seeds and pulses other than
gram" and such withdrawal was only with regard to production,
snpply, and distribution ol those commodities but was not with
regard to trade and commerce therein; (ii) that the Order of 1951
having been declared ultra "ires, the Order of 1945 which was
continued bys. 5 of the Ordinance of 1946 and then by s.·17 of
the Act of 1946 was still in force.
..
Held, (repelling the contentions) (i) that as the Order of i945
...
I
I
ceased to have effect with regard to the price, production; distribu·
tion and movements of those commodities, that Order could not
in any way continue to regulate or control trade or commerce in
those -commodities and the two Notifications of 1947 quite
effectively superseded the Order of 1945 so far as it purported to
regulate or control the price, production, distribution and move·
ment of or_ trade and commerce in edible oils and oil seeds and
pnlses other than gram;
'
·
. (ii) tha-t'the Order of .1951 was not declared ultra vires and
invalid in its entirety by the judgment of the Supreme Court dated
15th May, 1952. The Order was declared invalid in so far as it
purported to restrict the dealings in edible oils and oil seeds and
pulses other than gram. · The rest of the Order of 1951 and in
particular s. 9 thereof by which the Order of 1945 had been withdrawn, remained unaffected by the judgment of the Supreme Court,
-------·-- ---
·I
1954
T /,,

## Text

·----- ---
838
: . "SUPREME COURT REPORTS
[1955)
in England ~an argument which· we have already
·discarded. The argument founded on an assumed
]tl avinchandt'a legislative practice being thus out of the way, there can
Mafatla_l
v.
be no difficulty in applying its natural and grammatical
Th• Commission~ meaning to the ordinary English word "income." As
ofl•come-taz. · already observed, the word should be given it widest
Bombay c.1y. connotation in ·view of the fact that it occurs in a
n.,;.
Iegislativ"e head conferring legislative power.
'
For reasons stated above we are of opinion that Act
XXII of 1947 which amended the Indian Income-tax
, I
I954.
October I8.·
. Act by enlarging the definition of the term income in
section 2(6-0) and introducing a new head of income in
section 6 and inserting the new section 12-B is int·ra
vires the powers of the Central Legislature acting under
entry 54 in List I of the Seventh Schedule of the Govern~
merit of India Act, 1935. In this view of the matter it
is unnecessary for. us to consider or express any opinion
as to the meaning, scope and ambit of entry 55 in that
List. ·The appeal is accordingly dismis8ed with costs.
Appeal dismissed. ·
THE CHAMBER OF COMMERCE, HAPUR, AND
THREE OTHERS
v.
THE STATE OF UTTAR PRADESH AND
T\VO OTHERS.
[MEHR CHAND MAHAJAN C.J., s. R. DAS,
GHULA~I HASAN, BHAGWATI and JAGANNADHADAS JJ.]
Uttar Pradesh Food-grains (Futures and Options Prohibition)
Order, 1951-Uttar Pradesh Food-grains (Futures and Options
Prohibition) Order, 1945-Restrictfons on dealings in pulses other
thangram,....:.1,. both orders-Order o/'1951 partlu declared ultra
vires by Supreme Court-Not so s. 9 thereof which repealrd Order of
-1945-Whether Order of 1945 still fo force-Proper procedure for
' clarification of the matter • .
Uttar Pradesh Food-grains (Futures and Options Prohibition)
Order, 1951, made it illegal and a punishable offence for any
· person to enter into any fntures in pulses other than gram, or to
pa.y or receive or to agree to pay or receive a.ny margin rel.a.ting to
such futures. Bys. 9 of that Order the Order of 1945·conlaining .
similar provisions was repealed. An application qnd~r Art. S2 of
•
s.c.R.
SUPREl\IE COURT REPORTS
839
the Constitution presented by several persons (including the
z954
present petitioners) for the enforcement of their fundamental right
under Art. 19(l)(g) of the Constitution to carry on their business The Chamber of
and restraining the State from enforcing the Order of 1951 in so Commerce,Hapur.
far as it related to· pulses other than gram and for a declaration and three Others
that s. 2(o) of the Order read with items 6, 7, 8 and 9 of the
v.
schedule thereto was illegal and ultra vire1 the State Government
The State of
succeeded in the Supreme Court and . the State of Uttar Pradesh Uttar Pradesh
was directed by the Supreme Court by its judgment dated the 15th. and two Others
1Iay, 1952, to abstain from giving effect to it.
On the 10th June, l953, a lett~r (Exhi.bit B to th~ petition)
was addressed by the Deputy Commissioner, Food, Uttar Pradesh,
to all Regional Food Controllers and Deputy Food Controllsrs and
all District Magistrates in Uttar Pradesh instructing them to
regard all futures in foodgrains mentioned in the Schedule to the
1945 Order including pulses other than gram as punishable. ·· -
It was contended on behalf ~f the State (i) .that section 3 of 1946
Act which reproduced s. 3 of the 1946 Ordinance conferred on the
Central Goverllment ! extensiTe powers to· control production,- -
supply. distribution of and trade and commerce-· in 0ssentia1
commodities and this power was delegated by the Central Govern'.
ment to the Provincial Government by notification dated 21st
October, 1946, under s. 4 of the 1946 Ordinance. ·The subsequent
amendments made by two Notifications dated 5th March, 1947,
and dated 15th November, 1947, withdrew the power so delegated
only with respect to "edible oils and oil seeds and pulses other than
gram" and such withdrawal was only with regard to production,
snpply, and distribution ol those commodities but was not with
regard to trade and commerce therein; (ii) that the Order of 1951
having been declared ultra "ires, the Order of 1945 which was
continued bys. 5 of the Ordinance of 1946 and then by s.·17 of
the Act of 1946 was still in force.
..
Held, (repelling the contentions) (i) that as the Order of i945
...
I
I
ceased to have effect with regard to the price, production; distribu·
tion and movements of those commodities, that Order could not
in any way continue to regulate or control trade or commerce in
those -commodities and the two Notifications of 1947 quite
effectively superseded the Order of 1945 so far as it purported to
regulate or control the price, production, distribution and move·
ment of or_ trade and commerce in edible oils and oil seeds and
pnlses other than gram;
'
·
. (ii) tha-t'the Order of .1951 was not declared ultra vires and
invalid in its entirety by the judgment of the Supreme Court dated
15th May, 1952. The Order was declared invalid in so far as it
purported to restrict the dealings in edible oils and oil seeds and
pulses other than gram. · The rest of the Order of 1951 and in
particular s. 9 thereof by which the Order of 1945 had been withdrawn, remained unaffected by the judgment of the Supreme Court,
-------·-- ---
·I
1954
T /,, Chamber of
Commerce, Hapur,
and tliree Othtrs
v.
The State of
Uttar Pratksh
o.ndtwo Ot!urs.
840
SUPREME COURT REPORTS
[1955]
Strong disapproval was expressed by
the
Supreme Court of
the \Vholly unwarranted attitude adopted
by
the
officers of the
State of Uttar
Pradesh in circumventing the
decision
of
the
Supreme Court on a flimsy pretext.
The contentions advanced on behalf of the State Government
should have been advanced before the
Supre1ne Court ~n the previous occasion \vhen it delivered its judgment dated
15th
May,.
1952, or the 1natter should have been brought before the Supreme
Court by \vay of review if any review \.Vas competent.
ORIGINAL JURISDICTION : Petition No. 309 of 1953.
U oder article 32 of the Constitution of India for the
enforcement of Fundamental Rights.
K.
C. fain
and B.
P.
Maheshwari
for
the
petitioners.
K. B. Ast!tana and C. P. Lal for the respondents.
1954. October 18. The Judgment of the Court was
delivered by
DAs J.-This is a petition made under article 32 of
the Constitution by the Chamber of Commerce, Hapur
and three individual jJersons praying for a writ in the
nature
of
mandamus directing
the
State of
Uttar
Pradesh and two of its officers in the Food Department
to abstain
from enforcing
the
Uttar
Pradesh
Food
Grains (Futures and Options Prohibition) Order, 1945,
or any
orders or directions
contained in the letters'
issued by the respondents copies whereof are annexed
to the petition and marked
B and
D.
The facts and
circumstances leading up to this application may
be
shortly stated at the outset.
The Chamber of
Commerce, Hapur, is a companyincorporated under the Indian Companies Act with it»
registered office
at
Hapur.
There
are
about
20()
members of this
Chamber
of
Commerce
including
petitioners Nos. 2 to 4. Petitioner
No. 3 is also
its
President ancl Petitioner No. 2 is also a member of its.
Executive
Committee.
The members of the
Chambercarry on business in foodgrains including
pulses
both
on ready and forward basis. The
Chamber acts as a
clearing agent for
a commission and guarantees the
performance of forward contracts by its members upon
payment of margin money according to the rules.
•
...
..
•
S.C.R.
SUPREME COURT REPORTS
841
On or about
the
1st
September, 1945, the U. P.
Government, in exercise of pow,ers
conferred on it by
rule 81 (2) of the
Defence
of
India
Rules,
issued
Notification
No. 8071/c.s. promulgating
the
United
Provinces Food Grains (Futures and
Options Prohibition) Order, 1945, (hereinafter called "the 1945 Order").
Section 2(a) of that
Order
defined
"foodgrains" as
meaning
any
of the foodgrains
mentioned
in
the
schedule thereto.
Arhar,
peas, urd and moong
were
mentioned as items 6. 7, 8 and 9 of
that
schedule.
Section 3 provided as follows :-
"3. No person shall--
( a) enter into any futures in foodgrains or pay or
receive or agree to pay or receive any margin
relating
to any such futures ;
(b) enter into any options in food grains."
The Defence of India
Rules expired on the 30th
September, 1946, and consequently all
orders
made
thereunder were also due to expire on the same date.
On the 1st October, 1946,
however, there
came into
force the
Essential
Supplies
(Temporary
Powers)
Ordinance, 1946 (hereinafter referred to as
"the
1946
Ordinance")
promulgated by the
Governor-General and
published in the Gazette of India on the 25th September,
1946.
Section 3 of that
Ordinance
conferred on the
Central
Government
extensive
powers
to
control
production, supply, distribution of and trade and commerce in, essential
commodities as defined in section
2(a) thereof. Section 4 authorised the
Central Government to direct by notified order that the power to make
orders under section 3 should,
in
relation to
such
matters and subject to such
conditions
as might
be
specified in the direction, be excercisable also
by such
officer subordinate to it or by such
Provincial Government or such officer thereof as
might be specified m
the direction.
Section 5 of that
Ordinance
ran as
follows:-
"5. Continuance
111
force
of existing
orders.-
Until other provisions are made under this Ordinance,
any order, whether notified or not, made by whatever
authority
under rule 80-B, or sub-rule
(2) or sub-rule
(3) of rule 81 of the Defence of India Rules, in respect
1954
The Chamber of
Commerce, HaJluT.
and three Others
v.
Tht Stat6of
Uttar Pradeslt
and two Otlin-s.
Das]~
1954
The Chomb" of
Gmmerce, HaJmr.
and thrte Others
v.
The State of
Uttar Pradesh
.and two Otkrs.
Das].
842
SUPREME COURT REPORTS
11955]
of any matter specified in section 3, which was in force
immediately
before
the
commencement
of
this
Ordinance shall, notwithstanding
the expiration
of the
said rules, continue in force so far as consistent with
this
Ordinance and be deemed to be an order
made
under section 3 ; and all appointments made,
licenses
or permits granted and directions issued under any such
order and in force immediately before such commencement shall likewise continue in force
and
be deemed
to be made, granted or issued
in pursuance of
this
Ordinance."
The 1945 Order, therefore, continued in force untn
other provisions were made under the 1946 Ordinance.
In exercise of powers conferred on it by section 4
of the 1946 Ordinance the Government of India, on the
21st
October,
1946,
made
the
notified
order No.
PY603(2)-I directing that the powers conferred on it
by section 3(1) of that Ordinance should, in
relation
to foodstuffs,
be exercisable
also
by any
Provincial
Government, subject
to
certain
conditions
therein
set out.
In November, 1946, was passed the Essential
Supplies (Temporary Powers) Act, 1946 (hereinafter called
"the Act").
Section 3 of the
Act reproduced section 3
of the
1946 Ordinance with certain modifications not
material for our present purpose. Section 4 of the
Act
corresponds to section 4 of the 1946 Ordinance. The
relevant portions of section
17 of the Act provide as
follows:-
"17. Repeal and
savings.-(1) The Essential
Supplies (Temporary Powers)
Ordinance, 1946 (XVIII of
1946), is herehy repealed.
(2) Any order made or deemed to be made under
the said
Ordinance and in force immediately before the
commencement of this
Act shall continue in force and
be deemed to be an order made under this Act ; and all
appointments made, licences
or permits granted and
directions issued under any
such
order
and in force
immediately before such commencement shall likewise
continue in force and be deemed to be made, granted
or is~ued in pursuance of this Act.
\ •.
(
..
•
S.C.R.
(3)
(4)
SUPREME COURT REPORTS
843
,,
In exercise of powers conferred on it by section 4 of
th<".
Act the
Central
Government, by
Notification
No. C. G. 603(2)-III(1), dated
the
5th
March, 1947,
amended the abovementioned
notified order No. PY
603(2)-I, dated the 21st
October,
1946,
by inserting
after the word "foodstuff" the words "including cocoanut oil but excluding other edible
oils and oilseeds."
The net result of this notification was that "edible oils
and oilseeds" were excluded from the scope or operation of the delegated power. In other words, the power
delegated to the Provincial Government was withdrawn
in respect of "edible oils
and oilseeds" so
that
the
Provincial Government could not thenceforth make
any order controlling
the
production,
supply
and
distribution of or trade and commerce in "edible
oils
and oilseeds".
On the same day another
Notification,
being Notification No. C. G. 603(2)-III(2), was
issued
by the
Central Government in exercise
of
powers
conferred on it under section 3 of the
Act directing that
no order made or deemed to be made by a
Provincial
Government under the Act should have effect from that
date so as to prohibit or restrict
the
movement
of
edible oilseeds or oils other than cocoanut oil from any
place in a Province to any other place within or outside
the Province, or so as to regulate or control the price,
production or distribution thereof in any way.
Tl!erefore, the 1945 Order ceased to have effect so as to prohibit or res_trict the
movement
of edible oilseeds
or
oils other than cocoanut
oil or so to regulate or
control the price, production or distribution thereof in
any way.
On the 15th November, 1947, two Notifications were
issued by the
Central
Government. By Notification
No. PY. 603(2)-VI(1) made under section 4 of the
Act
the Central Government made a further amendment in
Notification No. PY. 603(2)-I dated the 21st
October,
1946, by inserting after the word "oil-seeds" the words
"and pulses other than gram". The
effect
of this
amendment was that "pulses other
than gram"
were
1954
Tiu Clwnber)j
C11mmtrce, Hll/IUf.
amJ thrtt Otfiers
v.
Tiu State of
Uttar Pralksh
and two Otlurs
Das].
195~
The Chamber of ,:.;
<Ammuct, Hapur.
•nd three 0 lhtrs
L
v.
Tilt State of
Uttar Pradesh
·and two Others.
Das].
844
SUPREME COURT REPORTS
[1955]
also excluded
from the
operation
of
the
power
delegated to
the Provincial
Governments.
In other
words, the power delegated to the
Provincial Governments was withdrawn in respect also of "pulses other
than gram", so that the Provincial Governments could
not thenceforth
make
any order controlling the production,
supply
and distribution
of
or trade
or
commerce in edible oils and oilseeds and pulses
other
than gram. Simultaneously by Notification No. PY. 603'
(2)-VI(Z) made on the 15th
November, 1947, under
section 3 of the
Act the Central
Government directed
that no order made or deemed to be made
under the
Act by a
Provincial
Government should have effect
from that date so
as to prohibit or restrict the movement of pulses other than gram from any place in a
Province to
any
other place within
or outside the
Province or so as to regulate or control the price, production or distribution thereof in any way. As a result
<Jf this
Notification the
1945
Order also
ceased to
have effect so as to prohibit or restrict the
movement
<Jf pulses other than gram or so as to regulate or control the price, production
or distribution thereof in
any way.
Then came the Uttar Pradesh Foodgrains (Futures
and
Options
Prohibition)
Order, 1951. It was promulgated by the State of
Uttar
Pradesh on the 20th
September, 1951.
By section 2(a) this
Order defined
'"foodgrains" as meaning any of the foodgrains specified
in the schedule thereto.
Arhar,
peas, urd and moong
were items Nos. 6, 7, 8 and 9 of that schedule.
Section
3 of the Order ran as follows :-
"No person shall-
.
(a) enter into any "futures in foodgrains" or pay
or receive any margin relating to any such futures ;
(b) enter into any options in foodgrains."
Section 8 made a contravention of any provision of
the Order or any order issued thereunder
punishable
under sections 7 and 7-A of the Act of 1946.
By section 9 of this Order the 1945 Order was withdrawn.
As the Uttar
Pradesh
Foodgrains (Futures and
Options Prohibition) Order, 1951 directly made it illegal
and a punishable offence for any person to enter into
. '\
j
'J
~.
S.C.R.
SUPREME COURT REPORTS
845
any futures in,
amongst others,
arhar, peas, urd and
moong or to pay or receive or to agree to pay or receive
any margin relating to any such futures. 10 members of
the
Chamber of
Commerce,
Hapur,
including the
present petitioners Nos. 2 to 4, on the 29th October,
1951, made an application to this
Court under article
32 of the Constitution for enforcement of their fundamental right under article 19(1) (g) to carry on their
business
and prayed
for the
issue of a
mandamus
restraining the State of
Uttar Pradesh from enforcing
the Uttar
Pradesh
Foodgrains (Futures and Options
Prohibition) Order, 1951, in so far as it related to pulses
other than gram and from exercising any power thereunder and
for a declaration
that section 2 (a) read
with items 6, 7, 8 and 9 of the schedule
thereto
was
illegal and ultra vires the powers of the
State Government. That application succeeded and the offending
Notification to the extent it dealt with arhar, peas, urd
and moong was declared invalid and the State of Uttar
Pradesh was directed to abstain from giving effect to
it. As will appear from the judgment pronounced by
this Court on the 15th May, 1952, on that application,
it was not seriously
disputed that the effect of the
amendments referred to above was that the power to
control and regulate trade originally delegated to the
Provincial Government by Notification No. PY. 603(1)-I,
dated the 21st October, 1946, was modified so as to
exclude from
the scope
of
such
delegation "pulses
other than gram".
On the 10th June, 1953, a letter (Ex. B to the petition) was addressed by the Deputy Commissioner, Food,
Uttar Pradesh, to all Regional
Food Controllers and
Deputy
Regional
Food Controllers and
all District
Magistrates in Uttar Pradesh instructing them to regard
all futures in foodgrains mentioned in the schedule to
the 1945 Order including pulses other than gram as
punishable. The reasoning
advanced
was
that
the
Uttar Pradesh Foodgrains (Futures and Options
Prohibition) Order, 1951, having been declared ultra vires
by the judgment pronounced by this Court on the 15th
May,
1952,
that Order
became
unenforceable
and
1954
T ht Chamber of
Comwrce, Hapur,
and three Othtrs
v.
Till :state of
Uttar Pradesh
and two Others.
Das].
1954
Th< Chambe> of
CM1UT10ce, Hapur,
and three Others
v.
TM State of
Uttar Pradesh
and two OtMrs.
Das].
846
SUPREME COURT REPORTS
(1955)
consequently the 1945 Order continued in force. A
copy of this letter was forwarded, amongst others, to the
Chamber of
Commerce, Hapur, for information
and
guidance.
By its letter dated the 25th June, 1953, the
Chamber pointed out that the earlier Order of 1945 had
been withdrawn by section 9 of the Order of 1951 and
as the last mentioned section had
not been declared
ultra vircs by the Supreme Court the 1945 Order ~ould
not be regarded as continuing in force.
On the 17th
September,
1953, the
Regional
Food
Controller of
Uttar
Pradesh wrote a letter (Ex. D to the petition)
to the President, Chamber of Commerce, Hapur, asking the latter to immediately stop all future
transactions pertaining to the foodgrains
mentioned
in the
schedule to the 1945 Order in which delivery was contemplated
within the
State of
Uttar
Pradesh
and
threatening action to be taken against
the Chamber.
This threat of
action necessitated the present petition
for the reliefs mentioned above.
Learned advocate appearing for
the State seeks to
justify the attitude of the
State on two grounds. It is
urged that section 3 of the 1946 Act which reproduced
with
certain
modifications
section
3 of
the
1946
Ordinance,
conferred on
the
Central
Government
extensive powers to control production, supply,
distribution of and trade and commerce in essential commodities.
This power was
delegated
by
the
Central
Government to the Provincial Governments by Notification No. PY. 603(2)-I issued on
the
21st
October,
1946, under
section 4 of the
1946 Ordinance. The
subsequent amendments made by Notification No. C. G.
603(2)-III(D dated the 5tl1 March, 1947, and Notification No. PY. 603(2)-VI(l) dated the 15th
November,
1947, withdrew the power so delegated only with respect
to "edible oils and oilseeds and pulses other than gram"
and such withdrawal
was only with regard
to the
production, supply and distribution of those commodities but not with regard to trade and commerce therein.
The second ground advanced is that the Order of 1951
having been declared
ultra vires the Order of 1945,
which was continued first by
section 5 of the 1946
Ordinance and then by_ section 17 of the Act, remained
'r
I
•
j
•
~·
S.C.R.
SUPREME COURT REPORTS
847
in full force. In our judgment there 1s no substance
in either of the two arguments.
As we have already pointed out, two Notifications
were published on the 5th March, 1947, and two Notifications
were issued
on the 15th
November, 1947. By
Notification
No. C. G. 603(2)-III(1)
dated the
5th
March, 1947, and Notification No. PY.
603 (2)-VI
(1), dated the 15th November, 1947, the earlier Notification No. 603(2)-1, dated the 21st
October, 1946, was
amended
by inserting therein the words "edible oils
and oilseeds"
and "pulses
other
than gram"
and
thereby excluding those commodities from the scope of
the delegation. As a result of these
amendments the
Provincial
Governments could not, from and after the
respective dates of those amending
Notifications, make
any order controlling production, supply, distribution
of or trade and commerce in those commodities. These
Notifications did not puport to affect Notifications that
had been previously made.
But simultaneously with
these amending Notifications two more
Notifications
were issued, namely, Notification No. C.G. 603(2)-III(2),
dated tl1e 5th March, 1947, and Notification No. PY.
603(2)-VI(2), dated the 15ili November, 1947. By these
Notifications the
Central Government directed iliat no
order made or deemed to be made under the Act by a
Provincial
Government should have effect so as to prohibit or restrict the movement of edible oils and oilseeds
and pulses other than gram or to regulate or control the
price, production or distribution of those
commodities
m any way.
As a result of ilie joint operation of these
Notifications the 1945 Order ceased to have effect so as
to prohibit or restrict the movement of edible oils and
oilseeds and pulses other than gram or to regulate or
control the price, production or distribution of those
commodities. As that Order
of 1945 ceased to have
effect with regard to the price, production, distribution
and movement of iliose commodities, it is not easy to
comprehend how that Order could continue to regulate
or control trade or
commerce in
those
commodities•
Trade or commerce in any commodity cannot be controlled unless ilie pnce, production, distribution and
movement of that commodity can
also be controlled.
16-88 S. C. India/59.
1954
The Chamb•r of
Commtrct?, H apur J
and thw Others
\'.
The State of
Uttar Pradesh
and two Others.
Das].
1954
The Chamber of
Commerce, Hapur,
and three Others
v.
The Stale nf
Uttat Pradtsh
.and two Others.
D., ].
848
SUPREME COURT REPORTS
[1955]
It follows, therefore, contrary to the contentions of the
State, that these
two
Notifications
of
1947
quite
effectively superseded the
1945
Order so
far as it
purported to regulate
or control the
price,
production, distribution and movement of or trade and commerce in edible oils and oilseeds and pulses other than
gram.
The second branch of the argument is equally fa llacious. It is wholly incorrect to say that the judgment
pronounced
by this Court on the 15th
May,
1952,
declared the Uttar
Pradesh
Foodgrains (Futures and
Options Prohibition) Order, 1951, ultra vires and invalid
in its entirety.
That judgment only declared it invalid
to the extent of the restrictions complained
of by the
then petitioners, namely, in so far
as it purported to
restrict dealings in edible oils and oilseeds and pulses
other than gram. The rest of that Order of 1951 and
in particular section 9 by
which the
1945
Order had
been withdrawn remained unaffected by that judgment
of this Court. It is quite difficult to
appreciate how,
in the circumstances, the Order of 1945 can be regarded
as having been rev.ived by the judgment in respect of
edible oils and oilseeds and pulses other than gram in
spite of the express withdrawal of that Order by section
9 of the
Order of 1951
which otherwise
remains
operative.
In our judgment there is no substance
whatever
in either of the two branches of argument
advanced
before us and this application
must succeed.
Accordingly we grant prayers (a), (b), (c) and (d) of the
petition.
Before concluding we desire to express our strong
disapproval
of the
wholly
unwarranted
attitude
adopted by the officers of the State of
Uttar
Pradesh.
Assuming there was any substance in their contentions,
the same should have been advanced before this Court
on the previous
occasion, for the contentions, if wellfounded, would have been a complete answer to that
application.
If the
contentions were
subsequently ·
discovered, then the same should have
been brought
before the Court by way of review, if any review lay.
•
. "·
--
-
-
,
S.C.R.
SUPREME COURT REPORTS
849
Instead of adopting that
straightforward
course the
officers of the State have
sought to
circumvent
the
decision of this Court on a flimsy pretext and
covertly
to challenge its correctness
on an obviously untenable
plea which has not even the
merit
of a
seeming
plausibility. This
conduct
verges dangerously on a
contempt of this
Court. We desire to make it quite
clear that we view with great disfavour such unworthy
attempt to get round the decision of this Court.
THE COMMISSIONER OF INCOME-TAX,
MADRAS
v.
MYSORE CHROMITE LIMITED.
[MEHR CHAND MAHAJAN C.J., s. R. DAS,
GHl)LAM HASAN, BHAGWATI
and VENKATARAMA AYYAR JJ.)
Indian Income-tax Act, 1922 (Act XI of 1922), s.
4-Profits
derived by the assessee-W hether arose or were 1·eceived in British
India in the present case.
The assessee
con;ipaqy with its registered office in
Mysore
State and its management vested in
Oakley
Bowden Co.
Ltd.,
Madras, sold Chrome ore to buyers mostly outside India who were
in America and Europe.
The sales to the purchasers in Europe
were put through in London by
Bowden Oakley and Co. Ltd.,
London, the agent of the assessee company in
Europe, the said
'-..
agent signing the contracts for sale in London. The sales to pur-
<. chasers in America were effected through W. R. Grace & Co., New
York, who bought for undisclosed principals, the contracts for sale
to American purchasers being signed by W. R. Grace & Co., Ltd.,
New York, in America and by Oakley Bowden & Co. Ltd. (Madras),
in Madras.
Under both forms of contracts with European purchasers and American
purchasers the price was
f.O.B.
Madras.
•
Provision was made for weighment, sampling and assay of goods at
destination.
The course of dealing between the assessee company
and the purchasers was as follows :-
>
Before the goods were actually shipped, the buyers used to
open a confirmed irrevocable Bankers' credit with some first class
Bank in London. Being informed of the opening of such credit the
1954
The Chamber of
Commerce, Ha/UT,
and three Others.
v.
The State of
Uttar Pradesh
and two Others.
1954
November r.