Narendra Kumar v. Union of India

Fundamental Rights are those rights which are essential for the intellectual, moral, and spiritual development of citizens in India. In the current case, the petition was filed under Article 32 of the Constitution challenging the validity of the “Non-Ferrous Metal Control Order” issued by the Government of India as according to the petitioners, it violated the fundamental rights under Articles 14, 19(1)(f) and 19(1)(g) of the Indian Constitution. The case Narendra Kumar v. UOI decided by the Supreme Court on 3rd December 1959 is discussed hereafter.

In the Supreme Court of India

Case nameNarendra Kumar And Ors vs. Union of India And Ors
Citation1960 AIR 430: 1960 SCR (2) 375
Year of the case1959, decided on 3rd December 1959
BenchSinha J, Bhuvaneshwar P. (Cj), Imam, Syed Jaffer j., Kanpur, j.L., Wanchoo, K.N., Gupta, K.C. Das.
PetitionerNarendra Kumar and others
RespondentThe Union of India and others
Acts involvedEssential Commodities Act, 1955, s. 3- Non-ferrous Metal Control Order, 1958, Constitution of India
Important provisionsArticle 14, 19, 32 of the Indian Constitution

Introduction

According to Dr. B. R. Ambedkar, Article 32 is the “soul of the Constitution and very heart of it”. This Article makes the Supreme Court the defender and guarantor of the fundamental rights. The petition in the current case Narendra Kumar vs. Union of India[1]was filed under Article 32 for the enforcement of Fundamental Rights under Article 14, Article 19(1)(f), and 19(1)(g). The case was decided by the Constitutional Bench of 5 Judges namely K.C. Das Gupta, Bhuvaneshwar P Sinha. (CJ),  Syed Jaffer Imam, J.L. Kapur, K.N.Wanchoo. The case has been briefly discussed in the following part of the paper.

Background of the Case

The petition was filed under Article 32 of the Constitution for the enforcement of Fundamental rights conferred by Articles 14, Article 19(1)(f), and 19(1)(g). The three petitioners who had filed the petition thereof were dealers in imported copper and carried on their business at Jagadhri in the State of Punjab.

They had entered into contracts on different dates before April 3, 1958, for the purchase of copper with importers. Before they could take delivery, the Government of India in the exercise of its power under Section 3 of the Essential Commodities Act, 1955, issued “Non-Ferrous Metal Order”. This order was made applicable to the imported copper.

The petitioners contended that the clause 4 of Order read with principles specified in the letter of the 18th April violates the Article 19(1)(f) of the Constitution of India to acquire property and also the right conferred by Article 19(1)(g) to carry on trade, that these violations are not within the saving clause of Articles 19(5) and 19(6) of the Constitution of India and therefore are void. It was further contended by the petitioners that the fixation of price under clause 3 of the Order violates Article 19(1)(f) and 19(1)(g). Further, the principles specified in the communication are discriminatory towards the dealers and manufacturers and hence, it was contended that it violates Article 14 of the Constitution. The Supreme Court held that the petition partly failed and succeeded in part.

Facts of the Case

  • On different dates before April 13, 1958, the petitioners entered into contracts of purchase of copper with ‘importers at Bombay and Calcutta, but before they could take delivery from the importers, the Government of India, in the exercise of its powers under Section 3 of the Essential Commodities Act, 1955, issued, the Non-ferrous Metal Control Order, 1958 on April 2, 1958.

The price was controlled by Clause 3 of the Order which provides in its first clause that “no person shall sell or purchase any non-ferrous metal at a price which exceeded the amount represented by an additional of 31/2% to its landed cost”, and in its second sub-clause that “no person shall purchase or offer to purchase from any person non-ferrous metal at a price higher than at which it is permissible for that other person to sell to him under sub-clause. While under Cl. 4 “no person shall acquire any non-ferrous metal except under and following a permit issued in this behalf by the controller following such principles as the Central Government may from time specify”.  

Clauses 5 & 6 of the order made it obligatory on the importers to notify quantities of non-ferrous metal imported and to maintain certain books of account, while the last clause i.e., clause 7 confers powers on the Controller to enter and search any premises to inspect any book or document and to seize any non-ferrous metal in certain circumstances.

  • No such principles, however, were published in the Gazette or laid before the two Houses of Parliament, though certain principles governing the issue of permits by the Controller were specified in a communication addressed by the Deputy Secretary to the Government of India dated April 18, 1958,  to the  Chief Industrial Adviser, under which the Controller could issue permits only to certain manufacturers and not to any dealer.
  • On April 14, 1958, the petitioners applied for permits to enable them to take delivery of the copper in respect of which they had entered into contracts, but the applications to grant permission were refused.
  • Thereupon, the petitioners filed a petition under Article 32 of the Constitution of India challenging the validity of the order refusing the grant of the permit as it infringes Article 14, 19(1)(f), and 19(1)(g).

Arguments Advanced

The petitioners contended, inter alia:

(1) that the fixation of the price under clause 3 of the Non-ferrous Metal Control Order, 1958 which had the effect of driving the dealer out of business in imported copper and similarly, clause 4 of the said Order read with the communication dated April 18, 1958, which had the effect of eliminating the  dealers from  the  trade-in  imported copper, contravened  Articles 19(1)(f) and 19(1)(g) of the Constitution, and  that such total elimination of the dealer amounting to the prohibition  of any exercise of the right to carry on the trade or to acquire property was not a mere restriction on the rights and was outside the saving provision of clauses (5) and (6) of Art 19,

(2) that the principles specified in the communication dated  April 18, 1958 being discriminatory in nature as between the manufacturers and dealers in copper, infringed  Article 14.

(3) that the said principles,   in any case, had no legal force, as they were not mentioned in the Non-ferrous  Metal Control Order, nor were they notified in the Official Gazette and laid before both the Houses of Parliament in the manner laid down in sub-section (5) and (6) of Section 3 of the Essential Commodities Act. 

The application was opposed by the respondents; their main contention was being that clause 3 and 4 of the Order and the “principles” specified are laws- which impose reasonable restrictions on the exercise of rights conferred by Articles 19(1)(f) and 19(1)(g) in the interest of the general public.

  • It was also contended on behalf of respondents that as the petitioners have not challenged the validity of the Essential Commodities Act and have admitted the power of the Central Government to make an order in exercise of the powers conferred by Section 3 of the Act it is not open to the Court to consider whether the law made by the Government in making the nonferrous metal order and in specifying the principles under clause 4 of the order violates any of the fundamental rights under the Constitution.
  • The order made by the Government can be attacked only if it is outside the power granted by the section or if it is mala fide. Mala fides have not been suggested and we are proceeding on the assumption that the Central Government was honestly of opinion that it was necessary and expedient to make an order providing for regulation and prohibition of the supply and distribution of imported copper and trade and commerce therein. So long as the Order does not go beyond such provisions, the Order must be held to be good and the consideration of any question of infringement of fundamental rights under the Constitution is wholly beside the point. Such an extravagant argument has merely to deserve rejection.  

Issues Involved

  1. Whether the Non-Ferrous Metal Order issued by the Government under Section 3 of the Essential Commodities Act violates Article 14 and 19 of the India Constitution.
  2. Whether the Non-Ferrous Metal Control Order issued by the Government void.

Related Provisions

Article 32 of the Indian Constitution

This Article gives the right to individuals to move to the Supreme Court to seek justice when they feel that their right has been (unduly deprived).

Article 14 of the Indian Constitution

This Article provides for equality before the law or equal protection of the laws before within the territory of India.

Article 19(1)(g) of the Indian Constitution

Under this Article, all citizens of India shall have the right to practice any profession, or to carry on any occupation, trade, or business.

Article 19(1)(f) of the Indian Constitution

It guaranteed to the citizens a right to acquire, hold, and dispose of the property. This Article got omitted from the Constitution with the 44th amendment.

Article 19(5) of the Indian Constitution

Under this Article restriction can be imposed in the interest of the general public.

Article 19(6) of the Indian Constitution

This Article enumerates the nature of restriction that can be imposed by the state upon the rights conferred under sub-clause (g) of the citizens

Section 3 of the Essential Commodities Act, 1955

This Section empowers the Central Government to control production, supply, distribution, etc. of essential commodities.

Related Cases

Chintaman Rao vs. the State of Madhya Pradesh[2]

In this case, the constitutionality of the Central Provinces and Berar Regulation of Manufacture of Bidis (Agricultural Purposes) Act, cameup for consideration, and Justice Mahajan while delivering the judgment, pointed out that the question was whether the total prohibition of carrying on the business of manufacture of bidis within the prohibition of carrying on the business of manufacture of bidis within the agricultural season amounted to a reasonable restriction of the fundamental rights mentioned under Article 19(1)(g) of the Constitution, based his decision that the impugned law did not come within the saving provisions of Article 19(6) of the Constitution on the view that the test of reasonableness was not satisfied and not on a view that “prohibition” went beyond “restriction”.

Madhya Bharat Cotton Association Ltd. vs. Union of India[3]

In this case, the petition was filed under Article 32 of the Constitution, complaining of discrimination under Article 14 and restraint under Article 19(1)(g) and here, the Court had to consider the constitutionality of an order which in effect prohibited a large section of traders, from carrying on their normal trade-in forward contracts. In holding the order to be valid, Bose, J., delivering the judgment of the Court said: “Cotton being a commodity essential to the life of the community, it is reasonable to have restrictions which may, in certain circumstances, extend to the total prohibition for a time, of all normal trading in the commodity.”

Judgment

It was found that the result of the abuse by the importers of the practical monopoly given to them of the copper market seriously affected the interests of the general public in India,  and that to protect these interests of the public the impugned legislation in the form of Non-ferrous Metal Control  Order and the subsequent specification of principles was made.

It was therefore held that clause 3 of the Order even though it results in the elimination of the dealer from the trade is a reasonable restriction in the interests of the general public. Clause 4 read with the principles specified must also be held for the same reason to be a reasonable restriction.

It was also urged by the petitioners that those principles were discriminatory as between the manufacturers and dealers and so violate Article 14 of the Constitution. The Court observed that the differentia which distinguishes dealers and manufacturers have a reasonable connection with the object of the legislation. And hence, the Court held that there is no substance in the contention made by the petitioners that the principles violate Article14.

(1) the word “restriction” in Articles 19(5) and 19(6) of the Constitution includes cases of prohibition “also; that where a restriction reaches the stage of total restraint of rights special care has to be taken by the Court to see that the test of reasonableness is satisfied by considering the question in the background of the facts and circumstances under which the order was made, taking into account the nature of the evil that was sought to be remedied; by such law, the ratio of the harm caused to individual citizens by the proposed remedy, the beneficial effect reasonably expected to result to the general public, and whether the restraint caused by the law was more than was necessary for the interests of the general public.

The case Chintaman Rao vs. the State of Madhya Pradesh[4]was considered. In Saghir Ahamad vs. The State of Uttar Pradesh[5], and in The State of Bombay vs. R.M.D. Chamarbaugwala[6] the question of whether the prohibition of the exercise of a right was within the meaning of restrictions on the exercise of a right used in clause 6 was raised, but the Court decided to express no final opinion in the matter and left the question open.

In Cooverjee B. Bharucha vs. The Excise Commissioner and the Chief Commissioner, Ajmer and others[7] the Court extended the provisions of Cl. 6 of Article 19 to a law that had the effect of prohibiting the exercise of a right to carry on trade to many citizens. Mahajan, J., delivering the judgment of the Court observed:

“To determine the reasonableness of the restriction regard must be to the nature of the business and the conditions prevailing in that trade. These factors must differ from trade to trade and no hard and fast rules concerning all trades can be laid down. It can also not be denied that the State has the power to prohibit trades which are illegal or immoral or injurious to the health and welfare of the public. Laws prohibiting trades in noxious or dangerous goods or trafficking in women cannot be held to be illegal as enacting a prohibition and not a mere regulation. The nature of the business is, therefore, an important factor in deciding the reasonableness of the restrictions.”

In Madhya Bharat Cotton Association Ltd. vs. Union of India[8], the Court had to consider the constitutionality of an order which in effect prohibited a large section of traders, from carrying on their normal trade-in forward contracts. In holding the order to be valid, Bose, J., delivering the judgment of the Court said: “Cotton being a commodity essential to the life of the community, it is reasonable to have restrictions which may, in certain circumstances, extend to the total prohibition for a time, of all normal trading in the commodity.”

(2) In the present case, the evil sought to be remedied is the rise in price which led to higher price of consumer’s goods in the production of which copper formed a major ingredient, the fixation of price and a system of permits for the acquisition of the material were reasonable restrictions in the interests of the general public; and that clause 3 and 4 of the Non-ferrous Metal Control Order, 1958, were accordingly, reasonable restrictions within the meaning Articles 19(5) and 19(6)

(3) that the differentia which distinguished the dealers as a class of manufacturers placed in the other class had a reasonable connection with the object of the legislation, and consequently, the principles specified in the communication dated April 18, 1958, did not contravene the Article 14 of the Constitution and,

(4) that the clause 4 of the Non-ferrous Metal Control Order was not effective without the principles to be specified by the Central Government in the manner laid down by sub-sections (5) and (6) of Section 3 of the Essential Commodities Act and as the principles specified in the communication dated April 18, 1958, were not notified in the Gazette nor laid before both the Houses of Parliament, as required under S. 3 sub-section (5) and (6), of the Act, clause 4 could not be enforced. Accordingly, clause 4 of the Order as it stood was void until the principles are published following Section 3 sub-sections (5) and (6).

The Court, therefore, held that the petitioners are entitled to relief only in respect of clause 4 of the order. The Court directed to issue an order to restrain the respondents from enforcing clause 4 of the Non-Ferrous Metal Control Order, so long as principles by law, are not published in the Official Gazette and laid before the Houses of Parliament by sub-sections (5) and (6) of Section 3 of the Essential Commodities Act. As the petition has succeeded in part and failed in part, the Court ordered that the parties would bear their costs. Hence, the petition was partly allowed.

Concepts Highlighted

The Court held in this case that, the principles in “Non-Ferrous Metal Order” do not violate Articles 14 and 19. And it observed that, without the principles, clause 4 of the “Non-Ferrous Metal Control Order” is not effective. So to make it effective, some principles should be specified, and to be notified in the gazette and to be laid down before the Houses of Parliament. But the principles specified in the Order were not notified in the Gazette, nor were laid down before the Houses of Parliament, also it would not come under the protection of clauses (5) and (6) of Article 19 and therefore, the clause 4 of the Order was struck down as void.

And the petitioners were, therefore, entitled to relief only in respect of clause 4 of the Order and also the Court directed to issue an order restraining the respondents from enforcing clause. 4 of the said Order, so long as the principles specified were not mentioned in the Gazette and laid before the Houses of Parliament. Thus, the petition was partly allowed in this case.


[1] AIR 1960 SC 430

[2] 1951 AIR 118: 1950 SCR 759

[3] 1954 SC 634

[4] Ibid

[5] 1954 AIR 728: 1955 SCR 707

[6] 1957 AIR 699: 1957 SCR 874

[7] 1954 AIR 220: 1954 SCR 873

[8] Supra 3

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