Allahabad High Court
Vishnu Kumar vs State Of U P And 2 Others on 28 November, 2019
Bench: Pankaj Mithal, Yogendra Kumar Srivastava
HIGH COURT OF JUDICATURE AT ALLAHABAD AFR Court No. - 29 Case :- WRIT - C No. - 30544 of 2019 Petitioner :- Vishnu Kumar Respondent :- State Of U P And 2 Others Counsel for Petitioner :- Ankit Agarval Counsel for Respondent :- C.S.C. Hon'ble Pankaj Mithal,J.
Hon'ble Dr. Yogendra Kumar Srivastava,J.
(Per Dr. Yogendra Kumar Srivastava,J.)
1. Counter affidavit filed on behalf of the third respondent by the learned 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/bio-diesel. 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 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 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."
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 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 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 (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 (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.
(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, Sub-section (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 MS-HSD Order, 2005 the Central Government has been empowered to issue directions to any dealer, transporter, consumer or any 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 MS-HSD 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 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 dip-rod 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. 454/29-07-2016 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 ¼;fn dk;Z LFky ou ds vkl&ikl gks½ 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 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(P-26825).--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 (B-100) 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 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,anti-adulteration 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). Any other conditions, which the State/UT Government may deem appropriate for sale of biodiesel as per the prevailing conditions in their respective State/UTs may also be included.
(xvi). State/UT Governments would designate an Appellate Authority to redress complaints related to denial of permission for sale of biodiesel to an applicant.
(xvii). Any clarifications in respect of these guidelines shall be made by the Central Government.
[F.No. P-13039(18)/1/2018-CC (P-26825)] SANDEEP POUNDRIK, Jt. Secy."
35. In terms of the aforementioned Guidelines 2019, a procedure is prescribed for submission of an application for permission of retail sale of bio-diesel to the Food and Civil Supplies Department/any other Department authorised for the purpose by the State Government of the concerned State where the retail outlet is to be set up. The permission for setting up the retail outlet is to be subject to the Registration/Approvals/No Objection Certificates from the respective State authorities in which the retail outlet is located and other concerned authorities. The guidelines provide for maintenance of permanent records, regular inspections by the State Government authorities and also prescribed norms for the said purpose. The State authorities have been empowered in terms of the guidelines to carry out regular inspections of the retail outlets.
36. It may also be taken note of that the Guidelines, 2019 notified by the Central Government in terms of Notification No. F.No.P-13039(18)/1/2018-CC(P-26825) dated 30th April, 2019 provide for making an application for permission of retail sale of bio-diesel to the Food and Civil Supplies Department/any other Department authorised for the purpose by the State Government where the retail outlet is to be set up. The Guidelines also empower the State Government authorities to carry out regular inspections of the retail outlets selling bio-diesel to ensure that the bio-diesel is being made available to the customer in the right quality and quantity and in case of any sample failure of the bio-diesel being sold the State/District Administration is to proceed with administrative action on the analogy of the Marketing Discipline Guidelines for retail outlets selling MS (Petrol) and HSD (High Speed Diesel).
37. The regulatory norms in respect of sale of bio-diesel in the context of the provisions contained under the MS-HSD Order, 2005 came up for consideration in the case of Indian Oil Corporation Limited Vs. Union of India2, wherein upon a petition filed by various oil companies by way of Public Interest Litigation, the provisions contained under the MS-HSD Order, 2005 and also guidelines laid down in the bio-diesel policy were taken note of and the writ petition was allowed with a direction to the State authorities to ensure that the provisions contained under the MS-HSD Order, 2005 are strictly observed by all concerned and that no violation of the said provisions takes place. The relevant observations made in the judgment are as follows :-
"15. Before dilating the various submissions raised by the learned counsel for the parties it is necessary to consider the various provisions contained in the Order of 2005. The Order of 2005 has been issued by the Ministry of Petroleum & Natural Gas on 19th December, 2005 in exercise of the powers conferred by section 3 of the Essential Commodities Act, 1955 and in suppression of Motor Spirit and High Speed Diesel (Regulation of Supply, Distribution and Prevention of Malpractices) Order, 1988. It extends to the whole of India and came into force on the date of its publication in the Official Gazette.
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23. It is apparent that Clause 3(5) provides in unequivocal term that 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 authorised 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. It is not disputed that buses run by CTC are type of automobile vehicles fitted with spark ignition engines or compression ignition engines as defined in Clause 3(5). Thus the sale made to the CTC by the respondent No. 6 was clearly in violation of the Control Order of 2005 and is punishable under section 7 read with section 3 of the Essential Commodities Act. It is not disputed on fact that 80% of the petroleum product was mixed with 20% of bio-diesel for the purpose of sale to CTC and selling of such mixture of petroleum product meaning thereby mixture of motor spirit and high speed diesel with any other products other than motor spirit and high speed diesel or other fuel is not permissible unless it is authorised by the Central Government, particularly when it can be for the use and is meant to be used as fuel in any type of automobile vehicles. Such mixture could not have been sold to CTC for running vehicles.
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28. In case any impermissible mixing as contemplated in Clause 3(5) of the Order of 2005 has been done or any other malpractices envisaged in the definition of malpractices in Clause 2(f) of the Order of 2005 has been committed, let appropriate action be taken in accordance with law.
29. Thus, we have no hesitation to allow the writ petition to the aforesaid extent and we hold that purchase made by CTC was illegal and violative of the provisions of the Order of 2005 read with sections 7 and 3 of the Essential Commodities Act. Since supply has already been stopped with effect from 2009 as stated at the Bar, no sale or any other transaction can be made by the respondent No. 6 which may be violative of the provisions contained in the Control Order of 2005. We also direct that let appropriate action be taken for violation of the order in accordance with law as expeditiously as possible.
30. Authorities of the Government of West Bengal are also directed to ensure that provisions contained in the Control Order of 2005 are strictly observed by all concerned and no violation takes place in the State of West Bengal."
38. The position which therefore emerges in the present case is that the petitioner was running the retail outlet without the requisite permission in terms of Clause 6-A of the Control Order and also without following the guidelines contained in the Government Order dated 27.10.2016 and also the subsequent Guidelines-2019, and criminal proceedings have been initiated with the lodging an F.I.R. dated 31.08.2019 which has been registered under Section 420 IPC read with Section 3/7 Essential Commodities Act, 1955 with regard to the adulteration and other malpractices and contravention of the terms of the Control Order 2005.
39. It is also 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 the same would be subject to the regulatory conditions provided for under the MS-HSD Order, 2005. The powers of search and seizure were 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.
40. The retail outlet of the petitioner 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 and also the guidelines under the Government Order dated 27.10.2016 had been contravened. Accordingly the 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.
41. As a consequence the reliefs as sought in the present writ petition with regard to quashing of the sealing order and opening of the seal of the under ground tank of the retail unit of the petitioner cannot be granted at this stage. The writ petition thus fails and is accordingly dismissed.
42. We may, however, take note that as per the provisions contained under Clause 8 of the MS-HSD Order, 2005 the sample of the product is required to be forwarded within ten days to any of the laboratories mentioned in Schedule III or to any other such laboratory which may have been notified by the Government in the Official Gazette. The laboratories as specified for the purpose are required to furnish the test report to the authorised officer within twenty days of receipt of sample at the laboratory and the authorised officer is thereafter required to communicate the test result to the dealer and also the oil company within five days of receipt of test results from the laboratory for appropriate action.
43. The aforementioned provisions as prescribed in Clause 8 of the MS-HSD Order, 2005 are to be followed and in case the proceedings with regard to forwarding of the sample of the product, obtaining the test result and communicating the same to the dealer/petitioner, have not been concluded by the respondent authorities, the same would be concluded, expeditiously, preferably within a period of six weeks from the date of presentation of a certified copy of this order.
Order Date :- 28.11.2019 Pratima (Dr. Y.K.Srivastava,J.) (Pankaj Mithal,J.)