Telangana High Court
Yadadri Bhongir District Rice Millers ... vs Union Of India on 11 March, 2025
THE HON'BLE SRI JUSTICE J.SREENIVAS RAO
WRIT PETITION Nos.15889, 15926, 19107, 19159, 19521, 19546,
19548, 19549, 19555, 19614, 19621, 19630, 19723, 19946,
20506 and 27766 of 2024
COMMON ORDER:
Heard Mr. Pasham Mohith, learned counsel for the petitioners in W.P.Nos.15889, 15926, 19159, 19521, 19546, 19548, 19549, 19555, 19614, 19621, 19630, 20506 and 27766 of 2024, Mr. K.Venumadhav, learned counsel for the petitioners in W.P.Nos.19107, 19723 and 19946 of 2024, Mr. B.Narasimha Sharma, learned Additional Solicitor General of India assisted by Mr. A.S. Vasudevan and Mr. K.L.N.Raghavendra Reddy, appearing on behalf of respondent No.1 Union of India and Mr. Dominic Fernandes, learned Standing Counsel appearing on behalf of Food Corporation of India (for short 'FCI').
2. In all these writ petitions, the petitioners have questioned the action of the respondents in rejecting the delivery of Fortified Rice Kernels (hereinafter referred to as 'FRK') supplied by the petitioners for the crop year 2023-24 and sought consequential direction to set aside the inspection conducted by respondent No.1 on 25.04.2024, 26.04.2024 and 29.04.2024 and also rejecting the lot of Acknowledgments submitted by the petitioners, and seeking to set 2 aside the communication orders issued by respondent Nos.1 and 3 declaring as Beyond Rejection Level (for short 'BRL') and sought consequential direction directing the respondent No.2 to accept the future deliveries of rice by the petitioners rice millers, without reference to the alleged rejection communication orders. Therefore, all the writ petitions were heard together and are being decided by this common order.
3. Brief facts of the case:
3.1 For the facility of reference, facts from W.P.No.15889 of 2024 are being referred to.
3.2. According to the petitioners, petitioner No.1 Association was registered under the Telangana Societies Registration Act, 2001 and it consisting various rice mills situated in Nalgonda District, Telangana State. The petitioner Nos.3, 5, 7, 9, 11, 13 are the rice mills, which are situated in Nalgonda District and they are engaged in the business of supplying rice to respondent No.2. In the year 2022, the Government of India with an intention to improve the quality of rice, introduced the scheme of fortification of rice, whereby Fortified Rice (FR) would be supplied through the Targeted Public Distribution System (TPDS).
Accordingly, respondent No.1 had issued Operational Guidelines dated 13.12.2022 on Quality Control for FRK and Fortified Rice. As 3 per the said Operational Guidelines, all the rice millers are obligated to blend FRK with Custom Milled Rice (for short 'CMR') in the ratio of 1:100 by using an automatic blending machine in order to ensure that the blending process takes place in an efficient manner. 3.3 The petitioners further averred that they are strictly following the Operational Guidelines issued by respondent No.1 while supplying FRK to respondent No.2. Accordingly, respondent No.2 had accepted such deliveries in the year 2022 without raising any objections. However, in the year 2023, respondent No.1 rejected the deliveries made by the petitioners after lapse of long period of time through communication dated 06.06.2023 alleging that the FRK were not blended with the CMR in the prescribed ratio. Immediately, the petitioners have submitted representation on 18.08.2023 to respondent No.2, stating that respondent authorities accepted the supply of the stocks made by the petitioners after conducting thorough inspection and after lapse of long period, they are rejected the deliveries on the alleged ground that FRK were not blended with the CMR in the prescribed ratio. Unless the stocks supplied by the petitioners are accepted, they will be put to great irreparable loss. They further stated that the alleged deficiencies in the nutritional value of FRK cannot be attributed to the petitioners since FRK are procured by the petitioners from the third parties/agencies, who have 4 been authorized by respondent No.2 to supply FRK and therefore, any deficiency in the nutritional value of the FRK is attributed to such third parties/agencies only.
3.4 They further averred that basing on the representation submitted by the petitioners and similarly situated rice millers, respondent No.2 and Federation of All India Rice Millers Association had brought the above said facts to the notice of respondent No.1 and accordingly, a meeting was convened on 18.08.2023. During the course of the said meeting, in order to ensure transparency, it was agreed upon that SOP dated 15.03.2023 notified by respondent No.1 shall be revised. As per the revised notification, FRK will be checked for the level of micro nutrients in fortified rice by gathering the samples in the presence of rice millers and State Government agency. Thereafter, the petitioners have submitted another representation on 11.09.2023 requesting respondent No.1 to resolve the issue pertaining to replacement/rejection of FRK.
3.5 They further averred that on 26.12.2023 respondent No.1 notified revised Standard Operating Procedure (for Short "SOP") for quality management protocols for FRK and fortified rice. As per the revised SOP, dated 26.12.2023, in the event, the sample collected from rice millers fails on account of blending, an opportunity should 5 be given to the rice millers to bring blending ratio of the rejected stock within the prescribed limits or alternatively by adding conventional FRK in FR, or by adding conventional rice in fortified rice, so that the blending ratio in the fortified rice becomes acceptable. As per the revised SOP dated 26.12.2023, respondent No.1 ought to have verified the blending ratio and if the ratio is within the prescribed limit, delivery of FRK can be accepted.
3.6 It is further averred that in the month of March and April 2024, the petitioners once again made deliveries of FRK to respondent No.2. After conducting a thorough mechanized check up, respondent No.2 has accepted the same without raising any objections. Thereafter, on 25.04.2024, 26.04.2024 and 29.04.2024, respondent No.1 had purportedly deputed a team to inspect the food storage depots under respondent No.2 and calling upon the Executive Director, Food Corporation of India, Zonal Office, South, through communication dated 11.06.2024 to take appropriate action for the stocks that have been declared as BRL.
3.7 The petitioners further averred that respondent No.3 issued notification on 18.06.2024 intimating the petitioners that the stocks delivered by them for the year 2023-24 have been rejected and the same was allegedly BRL and further directed the petitioners to replace 6 the BRL stock with fresh stock. Aggrieved by the same, the petitioners have filed the present writ petitions.
4. Respondent No.1 filed counter-affidavit denying the averments made by the petitioners inter alia contending that the Department of Food and Public Distribution (for Short "DFPD") have established policies to ensure the delivery of high-quality food grains to beneficiaries and all stakeholders are required to follow the SOP guidelines. A meeting was held on 18.08.2023 with members of The Federation of Rice Millers Association, during which, the SOP dated 15.03.2022 was discussed. The Federation requested the concerned rice millers be present during the sampling of 10% of the procured and stored stock for micronutrient testing, however, no decision was made by the Ministry on this matter. The Storage and Research (S&R) Division, under the direct supervision of the DFPD, manages post- harvest food grain operations. There are eleven Quality Control Cells under the DFPD, with headquarters in New Delhi and regional offices. In Telangana, rice procurement is carried out by the State Government (under the Decentralized Procurement Scheme) and the Food Corporation of India (FCI) (under the Non-Decentralized Procurement Scheme). The Central Government oversees the quality of food grains procured through both schemes and covers the entire 7 cost of procurement operations for the State Government and Food Corporation of India as per the approved budget.
4.1 It is further averred that the quality of the fortified rice stored for distribution through PDS/other welfare schemes a team of DFPD conducted inspection of various FSDs (Food Storage Depot) under FCI, Khammam and Nalgonda Districts w.e.f. 03.05.2023 to 08.03.2023 along with FCI and State Government officials. During the inspection, the sampling was done as per the ISO (International organization for standardization) norms titled as "Indian Standards CEREAL AND CEREAL PRODUCTS-SAMPLING (IS 14818:2017)". There was completely unbiased selection of stocks made at random, after careful examination of the stocks. The samples were drawn and seized during the course of inspection and they were analyzed in the laboratory of DFPD under the Ministry of Consumer Affairs, Food & Public Distribution in the presence of respondent No.2 and State Government officials and they were not purposively targeted to a particular rice miller. As the DFPD is the final/appellate authority, there is no provision for the reanalysis of the samples. 4.2 It is also averred that the redressal mechanism i.e., the appeal procedure as mentioned in the writ petition is applicable only during the time of procurement/acceptance of the stock. As the inspection 8 conducted by the officers of the Ministry is a routine activity, the appeal procedure does not apply to the present case. It is further averred that there is no provision for involvement of rice millers at any stage of inspection conducted by the officials. Moreover, the presence of concerned rice millers is not allowed in order to maintain the confidentiality of the entire process and to avoid any undue influence on the inspecting officers.
5. Respondent No.2 filed counter affidavit wherein it is stated that respondent No.1 had issued Operational Guidelines dated 13.12.2022 on quality control for FRK and fortified rice and the rice millers should have an automatic blending machine having the standard ratio prescribed by Bureau of Indian Standards (for short "BIS") to ensure accurate blending at a ratio of 1:100.
5.1 It is further averred that the Quality Control Cell (QCC) of the Department of Public Distribution, Government of India, conducts both periodic and surprise inspections at respondent No.2 Depots to monitor the quality of food grains during procurement, storage, and distribution managed by respondent No.2 and other agencies. FCI accepts food grain stocks based on the uniform specifications setup by the Government of India, as outlined in letter No. FCI HQ- QC012(11)/2/2023-QC, with reference to the details of inspection, 9 sampling, and analysis procedures for the procurement of paddy and the acceptance/purchase of rice stocks. In this context, all 14 stocks checked by Ministry are accepted on AGA (Automatic Grain Analyser) for quality parameters at the time of receipt. However, 13 stocks have been manually analysed in respect of FRK as per SOP of FCIHQQC029/1/2024 QC dated 15.02.2024, and 1 stock has been analyzed by AGA machine in respect of FRK.
5.2 It is also averred that all BRL stocks communicated on 06.06.2023 have been replaced by the concerned rice millers during the last year. As per the respondent no.2 letter No.HQ- QC012(11)/2/2023-QC, BRL stocks identified during subsequent inspections should be immediately replaced and the stocks must be verified by the AGM (QC) of the concerned Divisional or Regional Office. Accumulating of BRL stocks in Depot premises may not be allowed, as it adversary affect the storage and effect on stocking of fair average quality and potentially disrupting the Public Distribution System, and in case parties do not lift the rejected lots/consignment within 24 hours, they may not be allowed to dump their consignments. An action will be taken against the concerned miller in accordance with the instructions contained in the office letter No.QC/2(1)/06-07/Kharif specifications, dated 07.08.2007. 10 5.3 As per revised notifications, FRK must be checked for micro- nutrient levels in the presence of rice millers and State Government agencies is not correct. It is further averred that the bleeding ratio of FRK refraction should be in between 0.9% to 12% mandatorily. The 14 stocks checked by respondent No.1 were found BRL in terms of blending ratio of FRK which was on lower side i.e., 0.58% to 0.8% and on higher side blending ratio was 1.3% to 1.72%. It is further stated that any higher and lower percentage of FRK or variation in blending ratio prescribed by the Government of India 0.9% to 12% will not supply optimum dose of micronutrients (Vitamin B9, Vitamin B12, and Iron).
5.4 The appeal procedure is applicable only at the time of acceptance, which follows a three-level process. The first level is with the Assistant General Manager (QC), the second level is with the Deputy General Manager (QC) of the Regional Office, and the final level is with the Central Grain Analysis Labouratory, Ministry of Consumer Affairs, Food, and Public Distribution, Government of India. The Central Grain Analysis Labouratory serves as the appellate laboratory for testing physical parameters in food grains such as wheat, rice, paddy, bajra, jowar, millets, and others for various procuring and consuming agencies. However, the respondents are requesting replace the stocks as per existing guidelines. 11
6. Mr. Pasham Mohith, learned counsel for the petitioners, submitted that the petitioners rice millers are engaged in the business of custom milling of rice and supplying the rice to respondent No.2. In the year 2022, the Government of India introduced a scheme for the fortification of rice to improve its quality, ensuring that fortified rice is supplied through the TPDS in accordance with guidelines framed by respondent No.2. As per the Operational Guidelines notified by respondentNo.2, all the rice millers are obligated to blend FRK with CMR in the ratio of 1:100. The petitioners delivered FRK to respondent No.2 in March and April 2024, and after conducting a thorough mechanized check, the stocks were accepted without any objections.
6.1 He further submitted that a surprise check was conducted, without communication or intimation to the petitioners, on the stocks lying with respondent No.2. On 11.06.2024, the QCC of respondent No.2 reported to the Director that during the inspection of three depots, total 56 rice samples were collected, and out of it, 14 stocks were declared as BRL. It was recommended that the stocks be replaced as per procedure and liquidated only after verification by the DFPD team. The surprise check conducted by the officials of respondent No.2 is contrary to the SOP.
126.2 He further submitted that on 18.06.2024, the State Civil Supplies Corporation Limited, District Office, Nalgonda, issued a letter regarding the replacement of BRL stocks. The analysis showed that only one sample exceeded the 1.25% FRK shows as BRL, while the other 13 had minor FRK percentage variations due to handling. On the very same day, the petitioners requested the Commissioner of Civil Supplies, Hyderabad, to re-examine/re-analysis the samples. However, the petitioners' request for re-analysis has not been considered.
6.3 He further submitted that QCC team had drawn samples, without issuing notice and opportunity to the petitioners and without conducting on-the-spot analysis and even without complaint from any individual. The respondents have not followed the mandatory procedure as completed under SOP. On 05.08.2024, the petitioners requested the respondent No.2 to re-examine the samples. However, the same was not considered the same.
6.4 He also submitted that the petitioners urged that the procedure for fortified rice samples was not followed correctly, as the initial analysis was not conducted within the prescribed time. The checking process should have been completed within 24 hours and any rejection should have been conveyed within one week of dumping, 13 especially when the respondents have conducted surprise checks in the absence of any complaints or grievances is not permissible under law.
6.5 He also submitted that on 26.09.2023, respondent No.2 has issued guidelines for sampling and analysis procedure to be followed in procurement of paddy and acceptance/purchase of rice stocks during Kharif marketing season 2023-24. As per clause 9, samples will be drawn jointly with State Government representative by the technical assistant for the purpose of analysis to determine acceptability of the consignment as per the uniform specification/SOP. However, Clause Nos.12 and 17 were not followed and Clause No.23 states mandatory checks and quality control teams should conduct surprise checks with reports critically examined. He further submits that ISO regulations for cereals and pulses sampling were adopted by the Bureau of Indian Standards. As per the SOP dated 15.03.2023, there is a provision of appeal mechanism under Clauses 3 and 5. He further submitted that the respondents have not communicated the report to the petitioners and also not provided an appeal mechanism exists at the time of acceptance of stock. 6.6 He further submitted that on 12.01.2024, respondent No.2 introduced enhanced quality control measures using an AI-based 14 automated grain analyzer. Clause 6 states that if the AI analyzer malfunctions, samples can be tested at a nearby center and manual analysis is permitted with explicit GM (Region) approval to prevent work disruptions.
6.7 He further submitted that the appeal procedure for Fortified Rice, as per Government of India's 2023 guidelines, mandates drawing three sealed samples at the time of stock acceptance in the presence of officials and any stocks later identified as BRL must be replaced by the rice millers. He further submitted that respondent No.2 in its letter, vide RO TL-27.0038.0/1/2023-PROC-RO TL (E 97949) dated 01.10.2024, clearly stated that there is no provision of reconsideration and opportunity for representation/joint analysis of rice samples in the presence of all stakeholders, as per the instructions/guidelines issued by the Ministry.
6.8 He further submitted that respondent No.2 not followed the proper guidelines while conducting the surprise check and also denied the opportunity to present their case. He further argued that respondent No.2 did not maintain proper storage and affecting stock quality.
6.9 In support of his contentions, he relied upon the following judgments;
15
1. Mahavir Rice and General Mills v. State of Punjab 1
2. East India Commercial Co. Pvt. Ltd. v. Central board of revenue, Delhi 2
3. M/s. Sankambari Rice Industry, Bargarh and ors v. UOI (W.P (C)No.28700 of 2022)
7. Mr. K. Venumadhav, learned counsel for the petitioners, submitted that the stocks were received by respondent No.2 from the petitioners from 18.03.2024 to 05.05.2024. On the same day, tests were conducted and accepted them, as per guidelines issued by respondent No.2. But, later, on 11.07.2024, the respondents conducted a surprise check, without issuing any notice, and passed order stating that the said stocks are BRL and requested to replace the same. Therefore, the same is gross violation of principle of natural justice.
8. Mr. B.N. Sharma, learned Additional Solicitor General of India appearing for the respondents, submits that W.P.Nos.15889 and 15926 of 2024 should have been dismissed for mis-joinder of parties, as the impugned order dated 18.06.2024 applied only to six rice millers directing them to replace the BRL stock with fresh stock. Similarly, W.P. No. 27766 of 2024 filed by the association should also 1 2023 SCC online P&H 1631 2 1972 SCC Online Del 317 16 be dismissed, since separate writ petitions had already been filed before this Court.
8.1 Learned Senior Counsel further submitted that the Central Government introduced the scheme under TPDS for the purpose of supplying the rice to the people, who are below the poverty line, students, pregnant women, etc.,. He further submitted that National Accreditation Board for Testing and Calibration Laboratories supervise the testing and ensuring fortified rice blended at the correct ratio of 1 gm. of FRK per 100 gr. of CMR by conducting random checks with 40 lakhs metric tons of paddy sampled at a 10% rate. He further submitted that any initial rejection at delivery only allows a remedy of appeal is available.
8.2 He further submitted that surprise checks were conducted by the Central Government team along with the officials of respondent No.2 and Civil Supplies Corporation. There are 30 rice millers filed writ petitions from Nalgonda and Karimnagar Districts. Hence, the writ petition filed by the Association i.e., W.P.No.27766 of 2024 questioning the very same procedure is not maintainable and the same is abuse of process of law.
8.3 He also submitted that periodic checks and surprise checks were conducted as per the Operational Guidelines on quality control 17 for FRK and FR, dated 13.12.2022. Later, revised SOP was issued on 26.12.2023 in order to maintain the quality of FRK and FR and to provide good quality FR to the beneficiaries and all the stakeholders are advised to ensure strict compliance.
8.4 The appeal mechanism applies only at the stage of accepting CMR and not subsequent inspections. On 15.03.2023, the appeal procedure for fortified rice samples failing to meet the DFPD and FSSAI norms was established. The decisions made by referral or appellate labs are final and cannot be questioned by any stakeholders. 8.5 He further submitted that there are 11 quality control cells under respondent No.2 S&R Division in New Delhi, tasked with ensuring food grain quality during procurement, storage and distribution. These cells conduct periodic and surprise inspections at various locations and formulate policies and SOPs for quality management. On 26.09.2023, respondent No.2 had issued guidelines for inspecting and accepting rice stocks during 2023-2024 Kharif season. According to the said guidelines, the stocks identified as BRL on subsequent inspection should immediately be got replaced by the concerned rice miller and the replaced stock should invariably be verified by the AGM (QC) and BRL stocks cannot be accumulated in respondent No.2 Depots and in case the rice millers do not lift the 18 rejected consignment within 24 hours, they may not be allowed to dump their consignment. As on the date of inspection, 14 rice millers in Nalgonda and 16 rice millers in Karimnagar were instructed to replace their stocks, though none were rejected, and some rice millers were already replaced the stock. Hence, the relief sought by the petitioners rejecting the delivery of FRK is not true and correct. 8.6 The rice millers association filed W.P. No. 27766 of 2024 and the same is not maintainable under law on the ground that association is not an aggrieved party, especially the affected parties/aggrieved parties have already writ petitions. Learned Senior Counsel further submitted that the impugned proceeding issued by the respondents dated 15.03.2023 is valid and replacing stocks does not equate to rejection. The respondents after following Operational Guidelines and SOP, directed the petitioners to replace the fresh stock and the technical issues raised by the petitioners cannot be adjudicated in the writ petition under Article 227 of the Constitution of India. 8.7 He further submitted that the judgments cited by the petitioners are not applicable to the present facts and circumstances of the case, since the judgment referred by the petitioners supra 2 relating to the petroleum products and supra 3 was withdrawn by the petitioners therein.
198.8 In support of his contention, he relied upon the judgment of the Hon'ble Apex Court in Jayant Verma v. Union of India 3. The said judgment emphasizes the importance of adhering to the principle that general legislative entries should not be interpreted in a manner that undermines specific entries in the line with the maxim "generalia specialibus non derogant". The principle is Crucial in present case as it highlights the necessity of the following Operational Guidelines and SOP strictly.
9. Mr. Dominic Fernandes submitted that the manufacture of FRK and fortified rice requires a blending ratio test within the limit of 1:100, as per the procedure outlined in the SOP. Clause 2.1 states that FRK manufacturers must have an FSSAI license/registration and the blending ratio should range from 0.9 to 1.2. There are stages of quality management protocols of FRK and fortified rice, which are Stage 1 : As per the quality management protocols for FRK and fortified rice dated 26.12.2023, the vitamins and minerals premix (VMP) used must comply with FSSAI guidelines, and manufacturers must obtain a Certificate of Analysis (COA) from FSSAI-approved laboratories, which should include a QR code for verification. Manufacturers must maintain batch-wise records of the COA and premix used for audit trails accessible to authorities. In Stage 2, rice 3 (2018) 4 SCC 743 20 millers blending FRK with conventional rice must procure FRK from FSSAI-licensed suppliers, use a blending machine as per BIS standards, and ensure homogenous blending at 1% by weight. Quality checks should be performed through hourly blending efficiency tests, and records must be maintained. Periodic and surprise checks by DFPD are mandated, as mentioned in the letter dated 11.06.2024, which also requires periodic checks of PDS quality. These guidelines, formulated by the Department of Food and Public Distribution on 13.12.2022, are to be strictly adhered to by all stakeholders to ensure high-quality fortified rice for beneficiaries, with immediate effect. 9.1 He further submitted that the appeal mechanism is only applicable at the stage of accepting CMR and not for subsequent inspections. As per the order of respondent No.2, dated 15.03.2023, the appeal procedure for fortified rice samples found BRL as the prescribed norms issued by the DFPD, Government of India, and FSSAI, is final and it cannot be challenged by any agency or stakeholder. Actions against delinquents will be based on the ministry's report. The existing appeal procedure for rejection of rice stocks during the acceptance of CMR will continue to apply only to physical analysis parameters as specified by the Government of India. Therefore, no remedy of appeal is not provided or allowed at the subsequent inspection stages. He further submitted that the rice 21 identified as BRL must be immediately replaced. However, out of 56 samples, 14 samples were found exceeding the uniform specification limit of rice and declared as BRL. The respondent authorities are directed that the stocks that are declared as BRL may be replaced as per the procedure and they have not rejected the stocks, which were declared as BRL. If the fresh stocks were supplied in place of BRL, no prejudice would be caused to the petitioners.
9.2 He further submitted that as per the SOP for the Kharif season 2023-24, any BRL must be immediately replaced by the responsible rice miller being verified by the AGM (QC) of the concerned Divisional or Regional Office. Additionally, the accumulation of BRL in respondent No.2 Depots is strictly prohibited. If the rejected lots are not removed within 24 hours, appropriate action will be taken against the rice millers.
9.3 In support of his submission, he relied upon of the judgment of the High Court of Punjab and Haryana at Chandigarh in Isher Singh Hardeep Singh Rice Mills v. State of Punjab and others 4. The principle of judicial restraint in administrative matters stating that the procedural decision lie with authorities and interference is warranted only in the cases of misuse of power or procedural violations. It 4 2023 SCC online P&H2830 22 declines to direct an investigation, emphasizing the discretion of the authorities in policy implementation.
10. Learned counsel for the petitioners, by way of reply, submitted that FRK manufacturers must maintain batch-wise records of Certificates of Analysis and the vitamins and minerals premixed in production, uploading them to the FSSAI portal for audit purposes. These records must also be available for inspection by respondent No.2, DFPD and other authorities. He further submitted that the rice miller association has locus standi in the matter. The respondent authorities have conducted initial inspection without pointing out any discrepancies. Later, the respondents conducted surprise checks in their absence and the stocks were declared as BRL, without following the due procedure and acted according to their own whims and fancies. He submitted that SOP mandates that tests to be conducted within two months, but this timeline was not adhered to by the respondents.
10.1 He further submitted that the respondents used both AI machines and manual methods for testing the stock, but the procedure was unclear and no reasons were provided with regard to discrepancy. It is stated in the counter-affidavit of respondent No.2 that 13 stocks were manually analyzed and 1 stock was tested by 23 using AI machines and they failed to explain the rationale behind using manual sampling in some cases. In essence, the petitioners argue that the inspection process, surprise checks, and sampling procedures were flawed, lacked transparency, and violated the SOP. 10.2 In reply submissions again he relied upon the following judgments:
1. State bank of India and others v. Rajesh Argarwal and others 5
2. Akhil Bharatiya Soshit Karmachari Sangh v. Union of India & Ors 6
3. Jasbhai Motibhai Desai V. Roshan Kumar, Haji Basher Ahmed And Ors 7 Analysis:
11. Having considered the rival submissions made by respective parties and after perusal of material available on record, it reveals that in the year 2022, the Government of India introduced the scheme of fortification of rice, whereby fortified rice would be supplied through the TPDS for the purpose of supplying the rice to the people, who are below the poverty line, students, pregnant women, etc., Accordingly, respondent No.1 had issued Operational Guidelines dated 13.12.2023 5 (2003) 6 SCC 1 6 (1981) 1 SCC 246 7 (1976)1 SCC 671 24 on quality control for FRK and FR formulated by the DFPD in order to maintain quality standards. As per the said guidelines, all the rice millers have obligated to blend FRK with CMR in the ratio of 1:100 by using an automatic blending machine prescribed by respondent No.2. According to the petitioners, they are strictly following SOP procedure issued by respondent No.1. However, in the year 2022, respondent No.1 rejected the deliveries made by the petitioners alleging that the FRK was not blended properly with CMR in the prescribed ratio. Pursuant to the same, the petitioners have submitted representation dated 18.08.2023 to respondent No.2, wherein it is stated that the respondent authorities accepted the supply of the stocks made by the petitioners after conducting initial inspection and after lapse of long period, they are not entitled to reject the deliveries made by them. Pursuant to the said representation, under the Chairmanship of the Secretary (Food and Public Distribution), on the issues raised by the Federation of All India Rice Millers Association, conducted a meeting on 18.08.2023. In the said meeting, in order to ensure transparency, it was agreed upon that SOP dated 15.03.2023 notified by respondent No.1 has been revised. As per the revised notification, dated 26.12.2023, DFPD may conduct surprise checks to ensure the prescribed level of micronutrients in Fortified Rice at any stage. Thereafter, the petitioners have submitted another representation 25 dated 11.09.2023 requesting respondent No.1 to resolve the issues pertaining to replacement of FR.
12. In March 2024 to June 2024, the petitioners made deliveries of FR to respondent No.2 and after conducting thorough mechanized checking, the officials accepted the same without raising any objections. However, on 25.04.2024, 26.04.2024 and 29.04.2024, respondent No.1 had purportedly deputed a team to inspect respondent No.2 Depots and calling upon the Executive Director, Food Corporation of India, Zonal Office, South, through communication dated 11.06.2024, to take appropriate action for the stocks that have been declared as BRL. Thereafter, respondent No.3 issued proceedings dated 18.06.2024 informing the petitioners that the stocks delivered by them for the year 2023-24 have been found BRL and directed the petitioners to replace the BRL stock with fresh stock.
13. In all the writ petitions, it is stated that the rice millers have installed the prescribed machinery to ensure that effective blending of FRK with CMR and they procured FRK from the licensed manufacturers, who have been authorized by respondent No.2. The blending machine operates the blending as per the ratio prescribed. Thereafter, the rice millers deliver the FR to respondent No.2. Upon receiving such deliveries, respondent No.2 will conduct testing and 26 once such delivery is accepted, the role of rice millers comes to an end.
14. The grievance of the petitioners is that as per SOP dated 15.03.2023, the respondent authorities shall conduct physical analysis of the parameters by drawing samples from the stocks, which were delivered by the petitioners. However, the respondents without conducting such test and after accepting the deliveries, conducted surprise inspection and rejected the deliveries of the petitioners. On 11.06.2024, respondent No.1 addressed a letter to respondent No.2 Corporation, wherein it is stated that as per the procedure, the team from the Ministry was deputed to inspect the food storage depots under respondent No.2 in the month of April, 2024. During the course of inspection, three depots were inspected and in total 56 numbers of rice samples were collected. Thereafter, they conducted analysis test and basing on the detailed analysis report, it is found that out of total 56 samples of rice, 14 samples were found exceeding the uniform specification limit of rice and declared as BRL. On 12.07.2024, respondent No.1 found in other Depots that out of 75 samples, 17 were found exceeding the uniform specification limit and were declared as BRL. They further stated that the stocks that were declared as BRL may be replaced at the earliest, as per the procedure. 27
15. The record further reveals that as per the mandate of Government of India, a team of DFPD conducted inspection of various FSBS, which are under the control of FCI in various districts in the State of Telangana, along with FCI and State Government officials in the month of March to June, 2024. During the course of inspection, they have collected the samples and conducted test as per the higher standards titled as "Indian Standards CEREAL AND CEREAL PRODUCTS-SAMPLING". The said samples were drawn and sealed in the presence of Food Corporation of India and State Government Officials. The samples drawn during inspections were analyzed in the Laboratory of DFPD under the Ministry of Consumer Affairs, Food and Public Distribution as per BIS standards titled as 'Fortified Rice Specifications'.
16. The claim of the petitioners is that respondent authorities have conducted surprise checks, especially without giving any notice and opportunity to the petitioners and without following due procedure prescribed under the SOP and also conducted test without issuing notice and opportunity to the petitioners and basing on the alleged report furnished by the Government Authority, the respondent authorities rejected the stocks supplied by the petitioners on the ground that the same were found as BRL and the same is gross violation of principles of natural justice and contrary to the SOP. The 28 record reveals that as per the mandate of Government of India, Storage and Research (S&R) Division works, as a regulatory authority, conduct surprise checks to ensure that good quality of food grains have to reach to the beneficiaries. The inspection of food grains are carried out at Food Storage Depots (FCI, CWC, SWC & other State agency godowns), rice mills, rail heads, truck heads and Fair Price Shops by the Officers of the Quality Control Cells, which are under the direct of the DFPD with its headquarters in New Delhi and Regional Offices at Kolkata, Hyderabad, Bangalore, Bhopal, Bhubaneshwar, Lucknow, Pune, Patna, Chennai and Guwahati. The Depots were selected by the deputed Inspecting Officer invariably and randomly as per the availability of stock position in the godowns. During the course of inspection, the inspection team draws the samples and sent for analysis test in the laboratory of DFPD as per the BIS standards. In the said test, it was revealed that the stocks supplied by the petitioners are BRL.
17. The record further reveals that in the surprise inspection/check, as per the SOP, there is no requirement of issuance of prior notice to the petitioners proposing to conduct surprise check/inspection and also there is no requirement to conduct analysis test in the presence of the petitioners, especially when the petitioners 29 have not attributed any malafides against the officials of respondent Nos.1 and 2 that they intentionally refused to accept the stock supplied by them. Hence, the relief sought by the petitioners seeking to declare the action of the respondents in rejecting the delivery of FR made by the petitioners for the crop year 2023-24 as illegal, is not tenable under law, especially on the ground that the respondents have not rejected the stock supplied by them and they only directed the petitioners to replace the stocks as per the SOP for quality management for FRK and FR, as the said rice is meant for Public Distribution System.
18. It is pertinent to mention that the petitioners have not brought to the notice of this Court any provision or procedure that the presence of the parties is required at the time of conducting inspection, drawing of the samples and also at the time of conducting analysis test. It reveals from the record that the presence of the rice millers is not allowed on the ground that the respondents have to maintain confidentiality of the entire process and to avoid undue influence on the concerned Inspecting Officers. Hence, the contentions raised by the learned counsel for the petitioners that the respondents have conducted surprise inspections, drew samples and 30 conducted analysis test without providing notice or an opportunity and rejected the stocks supplied by them is not tenable under law.
19. Insofar as the other contentions raised by the learned counsel for the petitioners that though the petitioners have submitted representation on 18.06.2024 before respondent No.3 authorities requesting respondent No.2 to reanalyze the samples, the respondent authorities have not taken any decision nor provided remedy of appeal against the decision of respondent No.1 are concerned, as per the guidelines framed under SOP dated 26.12.2003, there is no remedy of appeal is provided against the decision taken by respondent Nos.1 and 2 authorities on the ground that they conducted inspection subsequent to the acceptance of the stock by way of surprise checks. As per the instructions issued by respondent No.2 dated 26.09.2023, the remedy of appeal is provided at the time of acceptance of FR only, but not subsequent stage of inspections.
20. In the case on hand, the competent authority conducted surprise checks and after analyzing the samples, came to conclusion that the stocks supplied by the petitioners' rice millers found that they are exceeding the uniform specification limit of rice and declared as BRL. Pursuant to the same, respondent No.1 issued proceedings dated 11.06.2024 informing respondent No.2 to take necessary steps 31 for replacement of the stocks. Pursuant to the above said proceedings as well as the proceedings issued by respondent No.2, the Telangana State Civil Supplies Corporation Limited and Telangana Warehousing Corporation, through impugned proceedings requested the petitioners' rice millers to arrange the replacement of BRL stocks with fresh stocks. Hence, the contention raised by the learned counsel for the petitioners that the respondent authorities rejected the stocks is not tenable under law, since the respondents have not rejected the stock and they only requested the petitioners' rice millers to replace the stocks on the ground that the stocks supplied by the petitioners' rice millers were found BRL.
21. The other contentions raised by the learned counsel for the petitioners that the inspecting authorities, in the absence of any permission, conducted surprise physical inspection and conducted manual testing contrary to the additional guidelines dated 15.02.2024 are concerned, the said guidelines were issued for enhancement of quality control measures for usage of Artificial Intelligence based an Automated Grain Analyzer (AIAGA) and the said additional guidelines are came with effect from 15.02.2024. Whereas, in the case on the surprise check was conducted by the competent authority as per the guidelines framed under SOP dated 15.03.2023 and taken samples and conducted test manually, wherein they found that the FR 32 supplied by the petitioners' rice millers are BRL. As per the SOP dated 15.03.2023, the authorities concerned are entitled to conduct surprise checks at food storage depots, rice mills, railheads, truck heads and Fair Price Shops and also no prior intimation is required. As per clause 2 (b) of the SOP dated 16.07.2021 issued by respondent No.1, surprise inspection can be conducted at any time by the Joint team without giving any prior notice to the concerned authorities of the State Government.
22. In Mahavir Rice and General Mill (supra), the High Court of Punjab and Haryana at Chandigarh held that when the petitioners are denied allotment of paddy on the ground of defective fortified rice when there is no defect in the CMR and defect in the forfeited rice is on account of low quality of FRK and FRK has not been manufactured by them, the Court is of the considered opinion that it would be unjust, unfair and violative of Articles 14 and 19(1)(g) of the Constitution of India.
23. In East India Commercial Co. Pvt. Ltd. (supra), the High Court of Delhi held that the failure to draw samples in the presence of the petitioners and the lack of connection between the test report. Additionally, penalties under Section 167(8) should be imposed only in cases involving prohibited goods, not mis-description. However, this 33 case is not applicable on the ground that issue pertains to petroleum not food corporation.
24. In M/s. Sankambari Rice Industry, Bargarh (supra), the High Court of Orissa at Cuttack, held that this case is not applicable to present case as it is only an interim order and subsequently the main writ petition was also dismissed as withdrawn on 09.05.2023.
25. In State Bank of India and others (supra), the Hon'ble Supreme Court referring to principles of natural justice held that RBI's circular classifying an account as fraudulent does not automatically amount to blacklisting. In the present case, the resupply of BRL stocks do not impact to any of the petitioners, as the stocks were not rejected but merely requested for replacement.
26. In Akhil Bharatiya Soshit Karmachari Sangh (supra), the Hon'ble Supreme Court held that Article 32 is not limited to recognized associations or individuals with a direct cause of action. However, the present case involves the rejection of stocks and all the rice millers have already filed separate writ petitions. Hence, there is no necessity for an Association or Telangana Societies Rice Millers to be a party to the litigation.
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27. In Jasbhai Motibhai Desai (supra), the Hon'ble Supreme Court held that the principle highlighted in this case is that only those with a legitimate legal interest or grievance, specifically a "person aggrieved," should be allowed to challenge administrative decisions through writ jurisdiction. The court emphasizes the importance of strict scrutiny in determining standing to prevent frivolous petitions, protect public policy, and ensure that the exercise of discretionary powers does not undermine healthy competition or violate fundamental rights. However, in the present case, aggrieved rice millers have already filed individual writ petitions.
28. It is brought to the notice of this Court that during the pendency of the writ petitions, pursuant to the decision taken by the respondent authorities, Dhanalaxmi Industries i.e., the petitioner in W.P.No.19723 of 2024, had already replaced 174 MT of BRL stock. Hence, the grievance of the writ petitioner in W.P.No.19723 of 2024 is no more in existence.
29. Insofar as the other writ petitions are concerned, it is already stated supra, that respondent Nos.1 and 2 authorities have not rejected the FR supplied by the petitioners and only directed them to replace the stocks as per the norms fixed under SOP, as the stocks supplied by the petitioners are found BRL, and this Court does not 35 find any ground, much less valid ground to interfere with the impugned orders passed by the respondent authorities exercising the powers conferred under Article 226 of the Constitution of India.
30. Accordingly, all the writ petitions are dismissed. No order as to costs.
Miscellaneous petitions, pending if any, shall stand closed.
______________________ J.SREENIVAS RAO, J Date:11. 03.2025 mar/pgp