[With Civil Appeal Nos.540/87, 541/87, 3872/90, 3024/88,3023/88, 1535/88, 1194/88, 1394/88, 1536/88, 1980/88, 1981/88, 3715/88, 2464/88, 6619/97, 2088-89/99, Civil Appeal Nos......................../2002 (@SLP (C) Nos.892/85, 27568-27570/95) and Writ Petition (C) No.8614/82] J U D G M E N T Y.K. Sabharwal, J.
The issue in these matters is about the validity and applicability of Bihar Agricultural Produce Markets Act, 1960 and the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966, to the extent these State legislations deal with sale of tobacco in market areas with particular reference to the levy thereupon of market fee, after enactment of Tobacco Board Act, 1975 ? a parliamentary legislation. The same is the issue in respect of similar State legislations passed by State Legislatures of Uttar Pradesh and Madhya Pradesh. These issues were subject matter of decision in ITC Ltd. & Ors. v. State of Karnataka & Ors. [1985 Supp. SCC 476].
We are required to determine whether ITC's case is correctly decided or not. That is a decision rendered by a three Judge Bench. The majority decided in favour of ITC. Later a Bench of two Judges expressed tentative view that the decision in ITC's case requires reconsideration. Thus, these matters are before this Bench. The arguments on behalf of the appellants contending that ITC has been correctly decided have been led by Mr. Shanti Bhushan followed and supported by other learned counsel appearing for Union of India and the Tobacco Board. On behalf of the State of Bihar and other parties contending that ITC has not been correctly decided, the arguments were led by Mr R.K. Dwivedi followed and supported by other learned counsel appearing for other States and Market Committees.
The answer to the question ? Whether ITC is correctly decided or not depends upon the scope of Entry 52 in Union List of the Seventh Schedule of the Constitution of India with particular reference to the meaning of the expression `Industries' in the said entry as also in Entry 24 of the State List of the Seventh Schedule of the Constitution.
In ITC's case the majority held that the provisions of the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966 are repugnant to the parliamentary legislation, the Tobacco Board Act, 1975 and, therefore, tobacco is liable to be removed from the Schedule of that enactment. Expressing the minority view, Sabyasachi Mukharji, J held that the State legislation and the Tobacco Board Act, 1975 can co-exist.
The first question to be determined is can State legislations and Tobacco Board Act co-exist in respect of sale of tobacco in the market areas within the framework of Agricultural Produce Marketing Acts - the State legislations under consideration? If our answer to this question is that the two legislations can co-exist, in that event it may not be necessary to go into the aspect of legislative competence. If, however, our answer is that the State legislations and the parliamentary legislation are incapable of reconciliation and the two cannot co-exist, in that case, the next question that would require determination will be about the validity of the State legislations. In the proposed judgment, Hon'ble Mr.Justice Pattanaik has come to the conclusion that the Agricultural Produce Markets Act and the Tobacco Board Act are in direct collision with each other and cannot be allowed to be operated simultaneously.
The State legislations and parliamentary legislations cannot co- exist is apparent from various provisions of the two legislations. To illustrate in this regard, reference may be made on one hand to Section 4(2) of Bihar Act and similar provision in other State legislations and on the other to the provisions of Section 13 of the Tobacco Board Act in States wherein this section has been enforced and also to Section 8(2)(cc). Reference can also be made to Rule 32 of the Tobacco Board Rules, 1976 framed in exercise of the powers conferred by Section 32 of the Tobacco Board Act regarding purchase of Virginia tobacco in comparison to Section 15 of Bihar Act requiring the agricultural produce, which tobacco is, to be brought to the market yard and sold by means of an auction or tender to the highest bidder. The power of the Tobacco Board to purchase from growers as provided in Rule 32 cannot co-exist with sale by auction or tender. Even in regard the price and manner of payment, licencing and auction procedure under two legislations and Rules made thereunder show that they cannot co-exist. In this regard reference can also be made to the Tobacco Board (Auction) Rules, 1984 and Tobacco Board (Auction) Regulation, 1984. It is evident that the compliance with the provisions of one would involve non-compliance of the provisions of the other. The provisions of the two legislations have been referred to in the judgment of Brother Pattanaik, J. I am in respectful agreement with the opinion of Justice Pattanaik that the two cannot operate and co-exist simultaneously. In this view, the question about the legislative competence of the State Legislature will have to be examined.
In ITC's case, two learned judges have held the State legislation to be invalid. The power of State Legislature per se to legislate in respect of sale of tobacco in market areas and levy of market fee, in view of Article 246(3) read with Entries 14, 28 and 66 of the State List, is not in dispute. The dispute has, however, arisen as according to ITC, on declaration as contemplated by Entry 52 of the Union List having been made by the Parliament in Section 2 of the Tobacco Board Act, 1975, and as a result of various provisions in that Act, the field of sale of tobacco which is said to be integral part of tobacco industry has been transferred from Entry 24 of the State List to Entry 52 of the Union List ? Entry 24 being subject to the provisions of Entries 7 and 52 of the Union List. The contention is that in this view, the State Legislature is deprived of competence to legislate in the field of sale of tobacco in market area and levy market fee. Under these circumstances, the competence of the State Legislature to legislate in regard to sale of tobacco would depend upon the answer to the question whether under Entry 52 of the Union List, the Parliament is competent or not to legislate in respect of sale of raw tobacco. If the answer to the question is that the Parliament is competent, in that eventuality, the State legislation will have to be invalidated for want of legislative competence. The answer to the question would, however, depend upon the scope of the expression `Industries' as deployed in Entry 52 of the Union List and Entry 24 of the State List. If we find that the expression `Industries' is wide enough to include the raw material of the industry and the Parliament is, thus, competent to enact law under Entry 52 of the Union List, in respect of raw material, the Parliament having supremacy as provided in Article 246(1), the parliamentary legislation, namely, the Tobacco Board Act would hold the field and the State legislation invalidated. The dispute in this case is not about parliamentary supremacy as none has doubted it in view of Article 246(1) of the Constitution but is whether Parliament has competence at all to legislate in respect of raw tobacco or it falls within the competence of State. If we hold that while legislating in the field of industry as provided in Entry 52 of the Union List, the Parliament is not competent to legislate in respect of the field anterior to industry, i.e. its raw material and can legislate only in respect of the process of manufacture or production, in that eventuality, the State legislation will have to be held to be constitutional, intra vires and applicable. In the proposed judgment, Justice Pattanaik has held that the word `industry' in Entry 52 of the Union List cannot be given restricted meaning so as to exclude from its purview the subject of legislation coming within Entry 27 or Entry 14 of List II and, thus, the parliamentary legislation, namely, the Tobacco Board Act, 1975 is constitutionally valid and, consequently, the State legislations entitling the Market Committee to levy fee for sale and purchase of raw tobacco within the market area will not be operative so far as the produce of tobacco is concerned and that the majority judgment in the ITC's case is correctly decided. I express my respectful dissent with the view expressed by Justice Pattanaik on this aspect and thus this separate judgment.
The Parliament and Assemblies draw power to legislate from the provisions of the Constitution of India. We are concerned here with Article 246. Article 246(1) of the Constitution provides that notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule. The said List is referred to in the Constitution as the `Union List'. Entry 52 in the Union List is `Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest'. In respect of field covered by this Entry, the Parliament has enacted the Tobacco Board Act, 1975. Section 2 of the Tobacco Board Act contains the declaration that it is expedient in the public interest that the Union should take under its control the Tobacco industry.
Article 246(2) provides that notwithstanding anything in clause (3), Parliament and, subject to clause (1), the Legislature of any State also, have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule. The said List is referred to in the Constitution as the "Concurrent List". Article 246(3) provides that subject to clauses (1) and (2), the Legislature of any State has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule. The said List is referred to in the Constitution as the "State List".
In exercise of power under Article 246(3), various State Legislatures have enacted Agricultural Produce Marketing Acts for regulating sale and purchase of the agricultural produce and levying market fee within the framework of those Acts which, inter alia, permit levy and collection of market fee. The tobacco under the Acts in question has been notified as an agricultural produce. In ITC's case, by majority, it was held that the Tobacco industry having been taken over by the Central Government under Entry 52 of the Union List by enactment of Tobacco Board Act, the State Legislature ceases to have any jurisdiction to legislate for that field and, therefore, the provisions of the Karnataka Agricultural Produce and Marketing Act entitling the market committee to levy market fee in respect of sale and purchase of Tobacco within the market area collide with Tobacco Board Act. Thus, the State Act so far as it relates to Tobacco was struck down. The minority view was that both the State and the Central Act can operate in their respective fields and there is no repugnancy if both the acts are considered in the light of their respective true nature and character. The majority judgment in ITC's case for the view that it took principally relied upon the two Constitution Bench decisions of this Court in State of Orissa v. M.A. Tulloch & Co. [(1964) 4 SCR 461] and Baijnath Kadio v. State of Bihar & Ors. [(1969) 3 SCC 838]. Referring to these two decisions, the opinion expressed was that these cases are direct authority on the question at issue, viz., if the Central Act and the State Act collide, the inevitable consequence would have to be that the Central Act will prevail over the State Act and later will have to yield and that the provisions of the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966 are repugnant to the Tobacco Board Act, 1975 and, therefore, tobacco is liable to be removed from the schedule of the said Act.
The minority view, however, was that there is nothing in the State Act or in the Rules which indicate that it is inconsistent with or cannot be operated along with the marketing regulations and both the Acts can operate in their respective fields and there is no repugnancy if both the Acts are considered in the light of their true nature and character.
In ITC's case the challenge was to the constitutional validity of the Karnataka Agricultural Produce Marketing (Regulation) (Amendment) Act, 1980. By the amending Act, tobacco was enumerated as an agricultural produce for the purposes of the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966. The High Court was of the view that the Tobacco Board Act did not cover the marketing of tobacco in its entirety but only covered a part of the area of the topic of marketing of tobacco and that the two legislations, namely, the Tobacco Board Act, 1975 and the Karnataka Agricultural Produce Marketing (Regulation) Act, can co-exist and operate cumulatively. The further view expressed by the High Court was that any intention of the superior legislature to cover the whole field to make a comprehensive law with regard to marketing of tobacco was not manifest in the legislation.
The contention canvassed before this Court in ITC's case was that in view of the Central Act, the State Legislature was not competent to bring into fold of the State Act, the tobacco, the matter being covered by Entry 52 of the Union List of the Seventh Schedule of the Constitution of India. The precise question in ITC's case was as to whether in respect of marketing of tobacco, the State Government was entitled to legislate or whether in view of the fact that there was a declaration under Entry 52 of the Union List, the State Legislature had no competence to legislate on tobacco and as such the impugned legislation was ultra vires.
In the minority opinion, Mukharji, J. noticed that the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966 deals with the subject of market in Entry 28 read with Entry 66 of List II and that it had to be borne in mind that Entry 28 is not subject to withdrawal to List I by Parliament. The State Act is not on a subject in List III nor is the Central Act a law relating to any subject in List III. It was concluded that, therefore, there cannot be any question of repugnancy. The nature and character of the Acts, namely, Karnataka Agricultural Produce Marketing (Regulation) Act, 1966 and the Central Act was noticed and it was held that it is fully manifest that both the Acts can operate in their respective fields. Further in the minority opinion it was observed that while giving due weight to Centre's supremacy in the matter of legislation, the States' legitimate sphere of legislation should not be unnecessarily whittled down because that would be unwarranted by the spirit and basic purpose of the constitutional division of powers ? not merely allocation of power by the Constitution but invasion by parliamentary legislations. While it is true that in the spheres very carefully delineated the Parliament has supremacy over State Legislatures, supremacy in the sense that in those fields, parliamentary legislation would hold the field and not the State legislation ? but to denude the State Legislature of its power to legislate where the legislation in question in pith and substance i.e. in its true nature and character, belongs to the State field, one should be chary to denude the State of its powers to legislate and mobilize resources ? because that would be destructive of the spirit and purpose of India being a Union of States. States must have power to raise and mobilize resources in their exclusive fields. The Marketing Act is essentially an Act to regulate the marketing of agricultural produce. Justice Mukharji said that "it must, therefore, be held that the State Act should prevail. One should avoid corroding the State's ambit of powers of legislation which will ultimately lead to erosion of India being a Union of States.". The majority opinion was expressed by Justice S.Murtaza Fazal Ali with whom Justice A. Varadarajan concurred. In the majority opinion after noticing the crucial point for determination i.e. whether the Karnataka State had any jurisdiction to encroach upon the limits of Entry 52 of the Union List, relying inter alia upon the decisions in the cases of Tulloch, Baijnath Kadio, it was concluded that once the Centre takes over an industry under Entry 52 of List I of the Seventh Schedule and passes an Act to regulate the legislation, the State Legislature ceases to have any jurisdiction to legislate in that field and if it does so, that legislation would be ultra vires the powers of the State Legislature. It was further observed that acceptance of the minority opinion would rob the Central Act of its entire content and essential import by handing over the power of legislation to the State Government which per se had been taken over by the Parliament under Article 246 by enacting the Tobacco Board Act, 1975. In the majority opinion reliance was placed on the following passage of Baijnath Kadio's case as extracted at page 174 as under:
"It is open to Parliament to declare that it is expedient in the public interest that the control should rest in Central Government.
To what extent such a declaration can go is for Parliament to determine and this must be commensurate with public interest. Once this declaration is made and the extent laid down, the subject of legislation to the extent laid down becomes an exclusive subject for legislation by Parliament. Any legislation by the State after such declaration and trenching upon the field disclosed in the declaration must necessary be unconstitutional because that field is abstracted from the legislative competence of the State Legislature. This proposition is also self-evident that no attempt was rightly made to contradict it."
The majority opinion has not noticed the Constitution Bench's decision in the case of Ch. Tika Ramji & Ors. etc. v. The State of Uttar Pradesh & Ors.[(1956) SCR 393] and other decisions on the scope of Entry 52 but relying upon M.A. Tulloch and Baijnath Kadio held that when declaration under Entry 52 of List I in respect of public interest is made and the extent laid down the subject of legislation to the extent laid down becomes an exclusive subject of legislation by the Parliament and any legislation by the State after such declaration trenching upon the field disclosed in the declaration must necessarily be unconstitutional because that field is abstracted from the legislative competence of the State Legislature. Thus it was held that the Government of Karnataka had no jurisdiction to levy any market fee on tobacco because the State Act to that extent collides with the Central Act of 1975.
The decisions in the cases of Baijnath Kadio and Tulloch have also been relied upon by Mr.Shanti Bhushan. Reliance has also been placed by learned counsel on The Hingir-Rampur Coal Co. Ltd. & Ors. v. State of Orissa & Ors. [(1961) 2 SCR 537]. It was contended by Mr.Shanti Bhushan that in law and in principle there would be no difference in respect of a case dealing with the scope of Entry 52 of the Union List or a case dealing with the scope of Entry 54 of that List. The submission of learned counsel is that for the purpose of interpretation both these entries have been equated by this Court and reliance in this regard is placed on Ishwari Khetan Sugar Mills (P) Ltd. & Ors. v. State of Uttar Pradesh & Ors. [(1980) 4 SCC 136].
On behalf of the State Governments and the Agricultural Produce Marketing Committees strong reliance has been placed on Tika Ramji's case. What is the ratio of these decisions, we will now examine.
Before considering the aforenoted decisions, it would be appropriate to make it clear that in these matters it has to be kept in view that this Court is not examining a case where the field of legislation is on concurrent list to which Article 246(2) applies. This Court is also not considering the case of an incidental trenching of field by one or the other legislature. The Court is concerned with the question of legislative competence. We are examining a case where what has been questioned is the legality of legislation in respect of a field on the State List to which Article 246(3) applies. The validity and applicability of the State legislations in respect of a field of legislation on State List has come under a cloud on account of a legislation passed by the Parliament in respect of field of legislation under Entry 52 of the Union List, namely, the Tobacco Board Act, 1975. It is on account of this legislation containing declaration as contemplated by Entry 52 of the Union List that doubts have arisen about the validity and applicability of State legislation about the sale of agricultural produce of tobacco in market areas and levy thereupon of market fee which aspects are on field of legislation on the State List (Entries 14, 27, 28 and 66). Entry 24 of the State List is subject to Entries 7 and 52 of List I. We are not concerned in these matter with Entry 7. The question here is as to the effect of transfer of field of legislation under Entry 24 of the State List to the Union List (Entry 52), on other fields in the State List, namely, fields of legislation under Entries 14, 27, 28 and 66 and what in fact can be transferred.
Baijnath Kadio was a case which considered the validity of the State legislation on the ground of being beyond the State legislative power in view of the declaration by the Parliament in Mines and Minerals (Regulation and Development) Act, 1957 as contemplated by Entry 54 of List I of the Seventh Schedule to the Constitution. Section 2 of the Central legislation declared that it is expedient in the public interest that the Union should take under its control the Regulation of mines and the development of minerals to the extent provided therein.
Entry 54 of the Union List speaks both of regulation of mines and minerals development and Entry 23 of the State List is subject to Entry 54. It was held that it was open to the Parliament to declare that it is expedient in the public interest that the control should rest with the Central Government. To what extent such a declaration can go is for the Parliament to determine and this must be commensurate with public interest. Once this declaration is made and that extent laid down the subject of legislation to the extent laid down becomes an exclusive subject for the legislation by the Parliament. Any legislation by the State after such declaration trenching upon the field disclosed in the declaration must necessarily be unconstitutional because that field is abstracted from the legislative competence of the State Legislature. For its view the Constitution Bench followed earlier Constitution Bench decisions in the cases of Hingir and Tulloch. These two cases also dealt with the scope of Entry 54 of List I viz-a-viz Entry 23 of List II. The majority opinion in ITC as already noticed, followed Baijnath Kadio and extracted in its judgment the passage as aforesaid.
A significant aspect to take note of is that Tika Ramji's case has not been considered in Hingir's case. The reason for it seems to be that one set of cases consider the scope of Entry 54 viz-a-viz Entry 23 and to that category belong the cases of Hingir, Tulloch and Baijnath Kadio. The other set of cases consider the scope of Entry 52 of Union List viz-a-viz Entry 24 of the State List and to that category belong the cases of Tika Ramji and other cases following Tika Ramji.
Relying upon Ishwari Khetan's case Mr.Shanti Bhushan contends that Entry 52 has been equated with Entry 54 of the Union List.
Both sides have relied upon the case of Ishwari Khetan. Let us examine that case. In Ishwari Khetan's case the contention urged was that the Parliament has made the Industrial (Development and Regulation) Act, 1951 (for short, `the IDR Act') in Entry 52 List I declaring control of sugar industry and that industry goes out of Entry 24 of List II and, therefore, State Legislature is denuded of legislative powers in respect of sugar industry and impugned legislation was with respect to acquisition of sugar undertaking in sugar industry. The Attorney General had contended that the power to acquire property was derived from Entry 42 of List III. Ishwari Khetan's case involved the determination or scope of Entry 52 of List I and Entry 24 of List II only. The scope of these entries with respect to Entries 26 and 27 of List II and Entry 33 of List III did not fall for consideration. Further in paragraphs 7, 8 and 11 of Ishwari Khetan's case the Constitution Bench repeatedly pointed out that a declaration in Entry 52 of List I denudes the power of State Legislature to legislate under Entry 24 List II only. It was noticed that the sugar was a declared industry. The question posed was that "is it, however, correct to say that once a declaration is made as envisaged by Entry 52 List I, that industry as a whole is taken out of Entry 24 of List II"? The answer given by the Constitutional Bench was that it is not correct to say that once a declaration is made in respect of an industry that industry as a whole is taken out of Entry 24 List II. It was said that the industry as a legislative head is found itself placed in Entry 24 of List II. The State Legislature can be denied legislative power under Entry 24 to the extent Parliament makes declaration under Entry 52 and by such declaration, Parliament acquired power to legislate only in respect of those industries in respect of which declaration is made and to that extent as manifested by legislation incorporating the declaration and not more. The Bench further said that the legislative power of the State under Entry 24 List II is eroded only to the extent the control is assumed by the Union pursuant to the declaration and the State Legislature which is otherwise competent to deal with industry under Entry 24 List II can deal with that industry in exercise of other powers enabling it to legislate under different heads set out in List II and List III and this power cannot be denied to the State. The extent of parliamentary legislation was seen only to determine how much is taken out from Entry 24 List II and not for the purposes of laying down any principle that the parliamentary legislation has to be seen to determine the extent of control and the denudation of the power of the State Legislature to the extent the control is laid down by the Parliament. Further it was held that despite the parliamentary legislation the State Legislature can deal with industry in exercise of other powers in different entries in List II and List III and that power cannot be denied to the State. In this case the Court was examining whether the law of acquisition of sugar undertaking was referable to Entry 24 List II or Entry 42 List III. It was concluded that the acquisition of the property was referable to Entry 42 List III. The scope of the industry did not fall for examination in Ishwari Khetan's case. There is no discussion on the interpretation of expression `industry' and that probably is the reason why Tika Ramji's case has not been referred to. The reliance on Baijnath Kadio's case in Ishwari Khetan's case was to show the denudation of States' power being limited to the extent of control. While Baijnath Kadio's case dealt with Entry 23 List II, Ishwari Khetan's case dealt with Entry 24 List II. The subject matter of the other entries was not in issue in this decision. The structure in Entry 54 of List I was not equated with that of Entry 52 List I as contended by Mr.Shanti Bhushan. This decision does not adopt the mines and minerals cases for the purposes of considering the scope of Entry 52 of List I. In our view, the cases of mines and minerals are not of much assistance while examining the scope of Entry 52 of List I.
In State of A.P. & Ors. v. Mcdowell & Co. & Ors. [(1996) 3 SCC 709] also it was held that the ambit and scope of a constitutional entry cannot be determined with reference to a parliamentary enactment. If it is otherwise, it would result in the Parliament enacting and/or amending an enactment thereby controlling the ambit and scope of the constitutional provision. That cannot be the law. The power to legislate with which we are concerned is contained in Article 246. The fields are demarcated in the various entries. On reading both, it has to be decided whether the concerned legislature is competent to legislate when its validity is questioned. The ambit and scope of an entry cannot be determined with reference to a parliamentary enactment.
Tika Ramji's case is required to be examined in some detail since that has been a bone of serious and elaborate submissions. In that case, the challenge by the Sugarcane growers hailing from several villages of State of U.P. was to the validity of the UP Sugarcane (Regulation of Supply and Purchase) Act, 1953 and notifications issued thereunder. A short history of legislation enacted by the Centre as well as the province of U.P. in regard to Sugar and Sugarcane was noticed.
It was noticed that on 8th April, 1932, the Central Legislature passed the Sugarcane Industry (Protection) Act, 1932. As a result of this Act, there was a rapid rise in number of sugar factories as also a large expansion in the cultivation of sugarcane. To regulate the price at which sugarcane intended to be used in the manufacture of sugar might be purchased by or for the factories, the Central Legislature enacted on 1st May, 1934 the Sugarcane Act, 1934. The fixing of minimum price for the purchase of sugarcane intended for use in any factory in any controlled area was left to the Provincial Governments which were empowered to make rules for the purpose of carrying into effect the objects of the Act including the organisation of growers of sugarcane into Co-operative Societies for the sale of sugarcane to factories.
With the coming into operation of the Government of India Act, 1935, there was distribution of legislative power between the Dominion Legislature and the Provincial Legislatures and agriculture (Entry No.20), trade and commerce within the Province (Entry No.27) and production, supply and distribution of goods, development of industries subject to the provision in List I with respect to development of certain industries under Dominion control (Entry No.29) were included in List II, namely, the Provincial Legislative List. Entry No.34 in List I was "Development of industries where development under Dominion control is declared to be in the public interest".
The result of above distribution of legislative power was that the entire subject matter of the Sugarcane Act, 1934 was left with the Provincial legislative list. It was felt that this Act was not sufficiently comprehensive for dealing with the problems of sugar industry. Therefore, it was found necessary to replace it so as to provide for better organisation of cane supplies to sugar factories. The U.P. Legislature accordingly enacted on 10th February, 1938, the U.P. Sugar Factories Control Act, 1938 to provide for licensing of the sugar factories and for regulating the supply of sugarcane intended for use in such factories and the price at which it may be purchased and for other incidental matters and repealed the Sugarcane Act, 1934. The 1938 Act was to remain in force initially upto 30th June, 1947 but the period was extended to 30th June, 1950 and then to 30th June, 1952.
On intervention of Second World War, a proclamation of emergency was issued by the Governor General under Section 102 of the Government of India Act, 1935. The Dominion Legislature acquired the power to make laws for the Provinces with respect to any of the matters enumerated in the Provincial Legislative List. The proclamation of emergency was to operate until revoked by a subsequent proclamation and the laws made by the Dominion Legislature were to have effect until the expiration of period of six months after the proclamation had ceased to operate. The Defence of India Act and the Rules made thereunder occupied the field. Sugar was made a controlled commodity in the year 1942 and its production and distribution as well as the fixation of sugar prices were regulated by the Sugar Controller thereafter. The proclamation of emergency was revoked on 1st April, 1946 and the laws made by the Dominion Legislature in the field of the Provincial Legislative List were to cease to have effect after 30th September, 1946. On 26th March, 1946, the British Parliament enacted the India (Central Government and Legislature) Act, 1946, Section 2(1)(a) whereof provided that notwithstanding anything in the Government of India Act, 1935, the Indian Legislature shall during the period mentioned in Section 4 thereof have powers to make laws with respect to the following matters :
"(a) trade and commerce (whether or not within a Province) in, and the production, supply and distribution of, cotton and woolen textiles, paper (including newsprint), foodstuffs (including edible oil seeds and oils), petroleum and petroleum products, spare parts of mechanically propelled vehicles, coal, iron, steel and mica; ..."
Acting under the power reserved to it under the aforesaid Section 2(1)(a), the Central Legislature enacted on 19th November, 1946, the Essential Supplies (Temporary Powers) Act, 1946 to provide for the continuance during the limited period of powers to control production, supply and distribution of, and trade and commerce in, certain commodities. The Governor General issued a Notification on 3rd March, 1947 the effect whereof was to continue the Act till 31st March, 1948. On 18th July, 1947, however, Indian Independence Act was passed under which the Governor General passed an order which substituted the words "Dominion Legislature" for "Both Houses of Parliament" in the proviso to Section 4 of India (Central Government and Legislature) Act, 1946 and also introduced a new Section 4(a) by way of adoption providing that the powers of the Dominion Legislature shall be exercised by the Constituent Assembly. By passing of the Resolution by the Constituent Assembly, the life of the Act was extended and later on Constitution coming into force, the Parliament was invested with power under Article 369 for a period of five years to make laws with respect to the following matters as if they were enumerated in the Concurrent List :
"`(a) trade and commerce within a State in, and the production, supply and distribution of,....foodstuffs (including edible oil seeds and oil),......' The life of the Act was accordingly extended from time to time upto 26th January, 1955 by Acts passed by Parliament."
Food crops under the aforesaid 1946 Act were defined as including crops of sugarcane.
The Central Government in exercise of powers conferred upon it by Section 3 of the 1946 Act, promulgated the Sugar and Gur Control Order, 1950, inter alia, empowering it to prohibit or restrict the export of sugarcane from any area; to direct that no gur or sugar shall be manufactured from sugarcane except under and in accordance with the conditions specified in the licence issued in this behalf. There was also power to fix minimum price in exercise whereof the Central Government from time to time issued notifications fixing the minimum price to be paid by the producers of sugar for sugarcane purchased by them.
On 31st October, 1951, Parliament enacted the Industries (Development and Regulation) Act, 1951 to provide for the development and regulation of certain industries. By Section 2 of the Act, it was declared that it was expedient in the public interest that the Union should take in its control the industries specified in the First Schedule. That Schedule included the industry engaged in the manufacture or production of sugar.
The U.P. Legislature enacted the impugned Act. The object of this enactment was stated to be as follows :
"With the promulgation of the Industries (Development and Regulation)Act, 1951 with effect from 8th May, 1952, the regulation of the sugar industry has become exclusively a Central subject. The State Governments are now only concerned with the supply of sugarcane to the sugar factories. The Bill is being introduced in order to provide for a rational distribution of sugarcane to factories, for its development on organized scientific lines to protect the interests of the cane growers and of the industry and to put the new Act permanently on the Statute Book."
In exercise of the rule making power conferred by the impugned Act, the U.P. Government made rules and also promulgated the U.P. Sugarcane Supply and Purchase Order, 1954. All these related to the supplies and purchase of sugarcane in U.P.
Challenging vires of the State Act one of the submissions made in Tika Ramji's case before the Constitution Bench was :
"(I) That the State of U.P. had no power to enact the impugned Act as the Act is with respect to the subject of industries the control of which by the Union is declared by Parliament by law to be expedient in the public interest within the meaning of Entry 52 of List I and is, therefore, within the exclusive province of Parliament. The impugned Act is, therefore, ultra vires the powers of the State Legislature and is a colourable exercise of legislative power by the State."
It was urged that the word `industry' was a word of very wide import and included not only the process of manufacture or production but also of things which were necessarily incidental to it, viz., the raw materials for the industry as also the products of that industry and would, therefore, include within its connotation the production, the supply and distribution of raw materials for that industry which meant sugarcane in relation to sugar industry and, therefore, insofar as the impugned Act purported to legislate in regard to sugarcane which was a necessary ingredient in the production of sugar, it was a colourable exercise of legislative power by the State, ostensibly operating in its own field within Entry 27 of List II but really trespassing upon the field of Entry 52 of List I.
True, the challenge was to the vires of the State legislation and not to the parliamentary legislation but at the same time the entire basis of challenge was that in respect of the sugarcane, only Parliament had the power to legislate on account of the field being covered under Entry 52 of List I, the Sugar industry having been included in that Entry and the connotation of industry being very wide to include in it raw material, i.e., sugarcane as well. Thus, the exclusive power of Parliament to legislate was urged as the main ground to seek invalidation of the State legislation ? the field of sugarcane not being available to the State Legislature to legislate. In view of the controversy as aforesaid, the fact that the validity of the parliamentary legislation was not in issue in Tika Ramji's case, does not in any manner, affect the ratio of that decision. The point for determination in that case was substantially the same as in the present case, namely, the scope of the expression `industries' in Entry 52 of List I and Entry 24 of List II. There also the point was to adopt a narrow or wide interpretation of the expression `industry'. Further, the fact that it was a case of a manufacturing industry under IDR Act also does not affect the ratio of the case. The interpretation placed in Tika Ramji's case cannot be confined to industry falling under IDR Act alone. There is neither any express or implied indication in that decision to limit the interpretation nor there is any valid reason to so limit it.
Like Tika Ramji's case, in these matters, the challenge is to the State legislations on the ground that in view of Entry 52 of List I, on enactment of Tobacco Board Act, 1975, the State Legislature loses competence to legislate in respect of sale of tobacco and, therefore, the existing State legislations will have no applicability and, thus, the legislations in respect of marketing under Entry 28 of List II would have no applicability insofar as it concerns the agricultural produce `tobacco'.
The opposite contention is that under Entry 14 of the State List the State is competent to legislate in respect of agricultural produce and tobacco is an agricultural produce; setting up of markets in respect of this produce under Entry 28 and levying thereupon the fee under Entry 66 and subject to Entry 33 of List III production, supply and distribution of goods (Entry 27) are all State subjects and that under Entry 52 of List I, the Parliament's competence is only to legislate in respect of industry which would not include in its ambit the raw material of the industry and that the process of sale of agricultural produce of tobacco in markets and levying thereupon market fee can never be part of industrial process which is only manufacture and production. The contention of Mr.Dwivedi is that State's activity in question is not an industrial activity and, therefore, it is outside the ambit of Entry 24 of State List and Entry 52 of the Union List. In Tika Ramji's case, the precise argument to challenge the State enactment was that the expression `industries' should be construed as including not only the process of manufacture or production but also activities antecedents thereto such as acquisition of raw material and subsequent thereto such as disposal of the finished products of that industry. It was urged in that case that the process of acquiring raw materials was an integral part of the industrial process and was, therefore, included in the connotation of the word `industry' and when the Central Legislature was invested with the power to legislate in regard to sugar industry on account of declaration as postulated by Entry 52 of List I, that legislative power included also the power to legislate in regard to the raw material of the sugar industry, that is sugarcane, and the production, supply and distribution of sugarcane was, by reason of its being the necessary ingredient in the process of manufacture or production of sugar, within the legislative competence of the Central Legislature.
The petitioners in Tika Ramji's case in support of the wide construction to be placed upon the expression `industry' also relied upon various decisions interpreting the said term in relation to the Industrial Disputes Act. Dealing with those cases in Tika Ramji's case this Court said:
"What we are concerned with here is not the wide construction to be put on the term `industry' as such but whether the raw materials of an industry which form an integral part of the process are within the topic of `industry' which forms the subject matter of Item 52 of List I as ancillary or subsidiary matters which can fairly or reasonably be said to be comprehended in that topic and whether the Central Legislature while legislating upon sugar industry could, acting within the sphere of Entry 52 of List I, as well legislate upon sugarcane."
This Court said that if the legislation with regard to sugarcane came within the exclusive province of the Central Legislature under Entry 52 of List I, the enactment passed by the Provincial Legislature would be ultra vires. It was said :
"If both the Central Legislature and the Provincial Legislatures were entitled to legislate in regard to this subject of production, supply and distribution of sugarcane, there would arise no question of legislative competence of the Provincial Legislature in the matter of having enacted the impugned Act. The conflict, if any, arose by reason of the interpretation which was sought to be put on the two Entries, Entry 52 of List I and Entry 27 of List II put in juxtaposition with each other. It was suggested that Item 52 of List I comprised not only legislation in regard to sugar industry but also in regard to sugarcane which was an essential ingredient of the industrial process of the manufacture or production of sugar and was, therefore, ancillary to it and was covered within the topic. If legislation with regard to sugarcane thus came within the exclusive province of the Central Legislature, the Provincial Legislature was not entitled to legislate upon the same by having resort to Entry 27 of List II and the impugned Act."
Dealing with the argument of wide import of the expression `industries' in Tika Ramji's case it was held that `industry' in its wide sense of the term would be capable of comprising three different aspects : (1) raw materials which are an integral part of the industrial process, (2) the process of manufacture or production, and (3) the distribution of the products of the industry. After noticing these different aspects of the term `industry', it was held that "the raw materials would be goods which would be comprised in Entry 27 of List II". In respect of the second category of process of manufacture or production and the third aspect of distribution of the product of the industry, the Court held :
"The process of manufacture or production would be comprised in Entry 24 of List II except where the industry was a controlled industry when it would fall within Entry 52 of List I and the products of the industry would also be comprised in Entry 27 of List II except where they were the products of the controlled industries when they would fall within Entry 33 of List III."
The Court further held that "In no event could the legislation in regard to sugar and sugarcane be thus included within Entry 52 of List I".
Thus, rejecting the contention that the expression `industries' in Entry 52 of List I is wide enough to take into its compass the power to legislate in respect of raw material said to be an integral part of the industrial process, the Court repelled the plea of the State Act being ultra vires, the same being covered by the subject of sugar industry control whereof have been declared by the Parliament by law to be expedient in the public interest under the exclusive domain of Parliament.
In The Calcutta Gas Company (Proprietary) Ltd. v. The State of West Bengal & Ors. [1962 Suppl.(3) SCR 1], the challenge was to the constitutional validity of the Oriental Gas Company Act, 1960. One of the ground of challenge was that the West Bengal Legislature was not competent to make a law regulating the gas industry in view of declaration as contemplated by Entry 52 of List I having being made by the Parliament in IDR Act ? Entry 24 being subject to the provisions of Entry 52 of List I. It was contended that Entry 25 of List II (Gas & Gas Works) must be confined to matters other than those covered by Entry 24 of the same List.
On the facts of the case and in view of the conclusions of the Constitution Bench on other aspect, it was not considered necessary to attempt to define the expression `industry' precisely or the State exhaustively all its ingredients but following Tika Ramji's case , it was assumed that the expression `industry' means only production or manufacture. In Calcutta Gas, which considers Entry 52 of List I and Entry 24 of List II, the Bench said that ordinarily `industry' is in the field of the State legislation and in all the entries it must be given the same meaning and cited with approval Tika Ramji's case in the following words:
"In Ch.Tika Ramji v. State of Uttar Pradesh, the expression `industries' is defined to mean the process of manufacture or production and does not include the raw materials used in the industry or the distribution of the products of the industry. It was contended that the word `industry' was a word of wide import and should be construed as including not only the process of manufacture or production but also activities antecedent thereto such as acquisition of raw materials and subsequent thereto such as disposal of the finished products of that industry. But that contention was not accepted."
Mr.Shanti Bhushan, however, contends that once field is covered by Entry 52 by issue of requisite declaration and the Parliament has actually covered the field by enacting a legislation, with regard to that extent the industry including all facets of such an industry ? whether it is the raw materials or the products of that industry, the State Legislature will have no power to legislate. The contention is that the expression `industries' in Entry 52 of the Union List comprises in it all its aspects commencing from procurement of raw material and upto disposal of final product of that industry and not only the process of manufacture or production. The submission of learned counsel is that if the expression `industries' in the entries under consideration is not given such interpretation, it would denude the Parliament of real object of control of such industry in public interest which is of paramount importance. As against this, the contention of the other side is that the acceptance of the viewpoint propounded by Mr. Shanti Bhushan would mean denuding the State Legislature the power to legislate in respect of fields covered under various entries under the State List which are not made subject to any other entry and that the acceptance of contention of Mr.Shanti Bhushan would have the effect of rewriting the Constitution. I agree. The intention of the Constitution makers was not to make Entries 14, 27, 28 and 66 subject to Entry 52 of the Union List. The acceptance of viewpoint propounded by Mr.Shanti Bhushan will have that effect. Therefore, the expression `industries' cannot be interpreted in the manner suggested.
True, the parliamentary legislation has supremacy as provided under Article 246(1) and (2). This is of relevance when field of legislation is on concurrent list. While maintaining parliamentary supremacy, one cannot give go by to the federalism which has been held to be a basic feature of the Constitution (See S.R. Bommai v. Union of India [(1994) 3 SCC 1]).
The Constitution of India deserves to be interpreted, language permitting, in a manner that it does not whittle down the powers of State Legislature and preserves the federalism while also upholding the central supremacy as contemplated by some of its articles. In this background, let us also briefly notice the constitutional history and structural inter-relationship in respect of relevant entries as they existed in Government of India Act, 1935 and as they now exist in the Seventh Schedule. Entries 27 and 29 on the State List in the Government of India Act, 1935 were as under :
"Item 27. Trade and commerce within the province; markets and fairs; money lending and money lenders.
Item 29. Production, supply and distribution of goods; development of industries, subject to the provisions in List I with respect to the development of certain industries under Federal control."
Now, in Seventh Schedule part of Entry 27 is in Entry 26 of the State List; Markets and fairs is Entry 28 of List II; Money lending and money lenders (Entry 30 List II); Production, supply and distribution of goods subject to the provisions to Entry 33 of List III (Entry 27 List II); Industries subject to the provisions of Entries 7 and 52 of List I (Entry 24, List II). It would, thus, be seen that under 1935 Act, both production, supply and distribution of goods as well as development of industries were subject to the provisions of List I as provided in Entry 29. Our Constitution makers, however, bifurcated Entry 29 into two parts. Industries were put in Entry 24 of List II subject to the provisions of Entries 7 and 52 of List I. The production, supply and distribution of goods was put in Entry 27 of List II and made subject to Entry 33 of List III. The acceptance of the argument of Mr. Shanti Bhushan would mean that no object was sought to be achieved by such a bifurcation. It is clear that two entries have been separated. One made subject to the provisions of Entry 33 of List III and the other subject to the provisions of Entries 7 and 52 of List I. Therefore, to interpret the expression `industry' to include in it the aspect of raw material would mean that by the same analogy the subject matter of production, supply and distribution of goods should also be included therein and in fact that was the argument of Mr. Shanti Bhushan. Would the acceptance of that argument not negate the will of the Constitution makers. I think it would. Therefore, the argument cannot be accepted. The same argument would equally apply to Entry 14 of List II in respect of agriculture which is not subject to any List. It would so become if we accept the contention of Mr. Shanti Bhushan. Further, earlier when the Parliament felt the need to control raw material, it included "raw jute and raw cotton" in Entry 33, List III by Constitution Third Amendment Act, 1954. Even Article 369 indicates that agricultural raw material is in the State List for it refers to raw cotton, cotton seed and edible oil seeds and seeks to temporarily place it, by fiction, in the concurrent list to enable Parliament to make laws. The expression `industries' in Entry 24, List II or Entry 52, List I, cannot be interpreted in a manner that would make other entries of List II of the Seventh Schedule subject to Union control, which in fact they are not. Wherever it was intended to be made subject to such control, whether of List I or that of List III, it was said so. A perusal of List II shows that whenever a particular entry was intended to be made subject to an entry in List I or III, it has been so stated specifically. Therefore, an interpretation which tends to have the effect of making a particular entry subject to any other entry, though not so stated in the entry, deserves to be avoided unless that be the only possible interpretation. We do not think that such an interpretation on the entries in question, namely, Entry 52 of the Union List and Entry 24 of the State List deserves to be placed. The principles of interpretation are well settled. There is no doubt that the entries in the lists in the Seventh Schedule do not provide competence or power to legislate on the legislature for which the source of power is contained in Article 246 of the Constitution. In deciding question of legislative competence, it has to be kept in view that the Constitution is not required to be considered with a narrow or pedantic approach. It is not to be construed as a mere law but as a machinery by which laws are made. The interpretation should be broad and liberal. The entries only demarcate the legislative field of respective legislature and do not confer legislative power as such and if it is found that some of the entries overlap or in conflict with the other, an attempt to reconcile such entries and bring about a harmonious construction is the duty of the court. When, however, reconciliation is not possible, as here, then the court will have to examine the entries in relation to legislative power in the Constitution. The subject matter of the issue here is about the interpretation of Entry 52 in List I of the Seventh Schedule. It requires the Parliament to make a declaration by law identifying an industry, the control of which by the Union is expedient in the public interest. Under the said entry only an `industry' can be declared as an industry, the control whereof by the Union is regarded as expedient in public interest. It is, therefore, implicit that if an activity cannot be regarded as industry, Entry 52 will have no applicability to that activity. The question is about the concept of `industry' in Entry 52 of List I. As already stated, the entries in the Legislative List have to be construed in the widest sense cannot be disputed but it has also to be borne in mind that such construction should not make other entries totally redundant. The meaning of the word `industry' in various dictionaries reliance on which was placed by Mr. Shanti Bhushan, is not of any assistance while considering the constitutional meaning of the said term. There may not be any embargo or limitation on the power of the Parliament to enact the law in respect of activities other than manufacturing activities but that power is non-existent in Entry 52 of List I. It may be elsewhere. Reference in this regard can be made to Entry 33 of List III including in its ambit food stuff and certain raw materials. Tobacco, however, is admittedly not a food stuff. The validity of certain other acts such as the Cardomom Act, 1965, The Central Silk Board Act, 1958, The Coffee Act, 1942, The Rubber Act, 1947, The Tea Act, 1953, The Coir Industry Act, 1953 and The Coconut Development Board Act, 1979 reference whereof was made by Mr. Shanti Bhushan need not be examined for purposes of considering the legislative competence of the impugned State legislations. The legislative competence of Parliament to legislate these statutes is not in issue before this Court and, therefore, we do not think it necessary to examine the question of legislative competence only from academic view point insofar as these legislations are concerned. However, prima facie, there is no substance in the apprehension expressed by Mr.Shanti Bhushan that narrow approach of the concept of `industry' would make these acts beyond the legislative competence of the Parliament and make them ultra vires. As, when and if these acts are challenged, the question of legislative competence would be examined. Further, it may be noted that two out of the aforesaid legislations, namely, the Coffee Act, 1942 and The Rubber Act, 1947 are pre-Constitution enactments made under the Government of India Act, 1935 where the entries were different. Item 29 of List II of the said Act has already been reproduced above. In respect of the Coir Industry Act, on examination of the provisions contained therein, it may be possible to urge that the statute deals with the process of manufacturing and does not seek to control plantation and preservation of the coconut trees or the production of the coconut. The Central Silk Board Act has been dealt with by this Court in the case of B. Vishwanathiah & Co. & Ors. v. State of Karnataka & Ors. [(1991) 3 SCC 358] and I fail to appreciate how upholding the validity of the Agricultural Produce Marketing Acts would effect the validity of this enactment. In respect of Cardomom Act, it appears that the said Act is being applied for export purposes and it does not cover soil preparation of seed-lings. Regarding Coconut Development Act, it does not envisage setting up of auction platform and controlling marketing as in the present case. That enactment primarily deals with the field pertaining to recommendation for improving marketing, providing financial assistance for adoption of modern technology and for assisting growers to get incentive prices. This Court, however, need not examine in detail the aspect of legislative competence in regard to these enactments since, as already said, that is not the matter in issue here and it would suffice to indicate, as above, only the prima facie view to dispel the apprehension expressed by Mr. Shanti Bhushan.
Harakchand Ratanchand Banthia & Ors. v. Union of India & Ors. [(1970) 1 SCR 479] has been strongly relied upon by Mr. Shanti Bhushan to support the contention of wide interpretation of the expression `industry'. The main question therein was about the legislative competence of the Parliament to enact the Gold (Control) Act, 1968. The said Act defines Gold to mean Gold, including its alloy (whether virgine, melted or re-melted, wrought or unwrought), in any shape or form, of a purity of not less than nine carats and including primary gold, article and ornament [Section 2(j)]. Clause (r) of Section 2 defines `primary gold' to mean gold in any unfinished or semi-finished form and includes ingots, bars, blocks, slabs, billets, shots, pellets, rods, sheets, foils and wires. Challenging the constitutional validity of the Gold (Control) Act, the contention urged was that the goldsmiths was a handicraft requiring application of skill and the art of making ornament was not an industry within the meaning of Entry 52 of List I of the Seventh Schedule of the Constitution. The Constitution Bench noticed the established principles that the widest aptitude should be taken of all the entries and the duty of the court to reconcile the entries and bring about a harmonious construction in case some entries in different list or in the same list may overlap or may appear to be in direct conflict with each other. In the present case, however, there is no question of any overlapping and in regard to conflict and harmonious construction, it is Mr.Shanti Bhushan's own submission that the two legislations to the extent this Court is concerned, cannot co-exist.
Reliance has been placed by Mr.Shanti Bhushan on the following passage from Banthia's case:
"But we are satisfied in the present case that the manufacture of gold ornaments by goldsmiths in India is a `process of systematic production' for trade or manufacture and so falls within the connotation of the word `industry' in the appropriate legislative entries. It follows, therefore, that in enacting the impugned Act Parliament was validly exercising its legislative power in respect of matters covered by Entry 52 of List I and Entry 33 of List III."
The contention of learned counsel is that in Harakchand Ratanchand Banthia's case, the process of systematic production for trade or manufacture has been held to fall within the connotation of the word `industry' in the appropriate Legislative Entry and the argument that if the word `industry' is construed in the wide sense, Entry 27 of List II will lose all meaning and content was rejected. The submission is that the same approach deserves to be adopted in the present case as well. The above approach was adopted after finding the activity to be manufacture or production and, therefore, falling within the connotation of `industry'. In Banthia's case, the Constitution Bench, in fact, cited with the approval Tika Ramji's case and referred thereto as under :
"In Tika Ramji v. State of Uttar Pradesh the expression `industry' was defined to mean the process of manufacture or production and did not include raw materials used in the industry or the distribution of the products of the industry."
In Banthia's case, the Court was considering the validity of the Act, the object whereof was to control production, manufacture, supply, distribution, use and possession of, and business in, gold, ornaments and articles of gold and for matters connected therewith or incidental thereto. There is no provision in the Gold (Control) Act, 1968 regulating the manner in which the primary gold would be extracted from the earth. The Act does not concern itself with the extraction of primary gold. The question therein was as to whether the work of goldsmiths was a handicraft requiring application of skill and whether the art of making gold ornaments was not an `industry' within the meaning of Entry 52, List I. In that case, the question was not whether dealing with the raw material of industry would come or not, within the concept of `industry'. Further, the Court observed that it is not necessary to attempt to define the expression `industry' precisely or to state exhaustively all its different aspects. On the facts of the case, the Constitution Bench held that the process or systematic production of gold ornament by goldsmiths for trade or manufacture falls within the connotation of the word `industry' in the appropriate Legislative Entry. The decision in Tika Ramji's case was not departed from. In fact it was referred to. An attempt to adopt the definition of the word `industry' in the Industrial Disputes Act was repelled. The contention accepted was that the manufacture of gold ornament was an `industry' within the meaning of Entry 52, List I. This decision is not of any assistance for determining whether sale of tobacco process can come within the of the tobacco industry so as to fall within the ambit of the word `industry' in Entry 52 of List I and Entry 24 of List II. The observation in Banthia's case that Entry 27 of List II was a general entry was made in the context of manufacture of gold ornaments by goldsmiths falling within the ambit of the word `industry' as contained in Entry 24 of List II and Entry 52 of List I. Banthia's case does not express any opinion on the scope of the word `industry' in Entry 52 of List I and Tika Ramji's case still holds the field when it says that the expression `industry' would mean the process of manufacture or production and would not include any raw material used in an industry or the distribution of the products of industry.
Mr. Shanti Bhushan has also placed reliance on another decision of the Constitution Bench in the case of Chaturbhai M. Patel v. The Union of India & Ors. [(1960) 2 SCR 362], in particular, to the observations made therein by Sir Maurice Gwyer, Chief Justice in Subramanyan Chettiar v. Muthuswamy Goundan [1940 FCR 188] which have been cited in Patel's case. The said observations read thus :
"It must inevitably happen from time to time that legislation, though purporting to deal with a subject in one list, touches also on a subject in another list, and the different provisions of the enactment may be so closely intertwined that blind adherence to a strictly verbal interpretation would result in a large number of statutes being declared invalid because the Legislature enacting them may appear to have legislated in a forbidden sphere."
Reliance was also placed on the observations of Justice Hidayatullah in State of Rajasthan v. G. Chawla & Anr. [AIR 1959 SC 544] as cited with approval in the case of Chaturbhai M. Patel. Those observations are :
"It is equally well-settled that the power to legislate on a topic of legislation carries with it the power to legislate on an ancillary matter which can be said to be reasonably included in the power given."
We have no difficulty in accepting the aforesaid observations made by Sir Maurice Gwyer, Chief Justice and Hidayatullah, J (as he then was) but it has to be borne in mind that the question for determination in Chaturbhai M. Patel's case was regarding true nature and character or the pith and substance of the impugned Act, namely, Sections 6, 8, 9 and 10 of the Central Excuse and Salt Act, 1944 and Rules 140 to 148, 150, 171 to 181, 215 and 226 of the Central Excise Rules, the constitutional validity whereof was under challenge. The Constitution Bench was considering the constitutional validity of a fiscal measure to levy and realise duty on tobacco. The contention was that Sections 6 and 8 of the impugned Act and rules made thereunder were beyond the legislative competence of the Central Legislature under the Government of India Act, 1935. The Court was examining the question whether the impugned Act is a law with respect to matters enumerated in Item 45 of List I under the 1935 Act or to the matters enumerated in Items 27 and 29 of List II. Entries 27 and 29 have already been reproduced above. They dealt with the power of the State to legislate in respect of trade and commerce, markets and fairs, money lending and money-lenders. Item 29 dealt with power to legislate in respect of production, supply and distribution of goods, development of industries, subject to the provisions in List I with respect to the development of certain industries under the Federal control. The question was whether the impugned Act in pith and substance relate to duties of excise on tobacco as contained in Item 45 or it falls within the boundaries of Items 27 and 29 of the Provincial List. Referring to the decision of the Federal Court, it was held that in the interpretation of the scope of these items, widest possible amplitude must be given to the words used and each general word must be held to extend to ancillary or subsidiary matters which can be fairly said to be comprehended in it. On examination of the provisions of the Central Excise Act, the Court came to the conclusion that various provisions of the Act and the Rules were essentially connected with the levying and collection of the excise duty and in its true nature and character the Act remains one that falls under Item 45 of List I and the incidental trenching upon the provisional field of Items 27 or 29 would not affect the constitutionality because the extent of invasion of the provisional field may be a circumstance to determine the true pith and substance but once that question is determined, the Act would fall on the side of central field and not that of the Provincial field. It is, thus, evident that since in pith and substance the matter pertained to excise duty, it fell under Item 45 of List I and the non-tax entries in Item 27 or 29 could not be invoked. In the Constitution also, Entry 84 relates to duty of excise on tobacco and other goods manufactured or produced in India.
Referring to the argument of the petitioner based on Rule 181 which dealt with revocation and suspension of licenses and empowered the licencing department to revoke or suspend a licence under certain circumstances and the argument that it was the field under the province of the provincial legislature, the Court said that this rule may have an indirect effect of depriving an owner of a bonded warehouse from the privilege of keeping such a warehouse but that does not mean that the object of the Act is not imposition, collection or realization of duty of excise. The rule was held to be "a mean of making the realization of duty effective and necessarily incidental to effectual legislation for collection of duties". In the present case, there is no question of any incidental trenching. It cannot be said that the law relating to sale of tobacco in market area is incidental to law regarding tobacco as enacted by Tobacco Board Act. The decision in Chaturbhai M. Patel's case, in our opinion, has no relevance for the present purpose and so also the decision in the case of State Bank of India v. Yasangi Venkateswara Rao [(1999) 2 SCC 375]. The question squarely involved here is about the interpretation of the expression `industry' within the meaning of Entry 52 of List I and Entry 24 of List II.
In Ganga Sugar Corporation Ltd. v. State of U.P. & Ors. [(1980) 1 SCC 223] the constitutional validity of U.P. Sugarcane Purchase Act was challenged on the ground that it invades Entry 52 of List I with respect to sugar industry which is a controlled industry under the IDR Act, 1951. The question raised therein was this : "Is the legislation ultra vires because the State enters the forbidden ground by enacting on controlled industry"? It was undisputed that sugar industry was a controlled industry within the meaning of Entry 52 of List I of the Seventh Schedule and, therefore, the legislative power of Parliament covered enactments with respect to industries having regard to Article 246(1) of the Constitution. The Court said that if the impugned Act invades Entry 52, it must be repulsed by the Court. The Court, however, expressed surprise at the argument of invalidity of the Act despite the decision of the Constitution Bench in Tika Ramji's case. The Court said that the Constitution Bench decision must be accepted as final unless the subject be of such fundamental importance to national life or the reasoning is so plainly erroneous in the light of later thought that it is wiser to be ultimately right rather than to be consistently wrong. It said that the pronouncement by the Constitution Benches should not be treated so cavalierly as to be revised frequently. Recalling the words of Chief Justice Roberts of the U.S. Supreme Court in Smith v. Alwright [(321 US 649 at 669] "that adjudications of the Court were rapidly gravitating `into the same class as a restricted railroad ticket, good for this day and train only' ". That part of Tika Ramji's case was referred which dealt with the contention regarding the word `industry' being of wide import and included not merely manufacture but also the raw material for the industry and rejection of this contention. Paragraphs 31, 31a and 32 deal with Tika Ramji's case and rejection of the argument as to whether raw material of an industry which form an integral part of the process are within the topic of `industry' which forms the subject matter of Item 52 of List I. The Bench said :
"The edifice of exclusive parliamentary jurisdiction so built stood on shifting sands. The semantic sweep of Entry 52 did not come in the way of the State legislature making laws on subjects within its sphere and not directly going to the heart of the industry itself."
The submission of Mr. Shanti Bhushan, who appeared in Ganga Sugar Corporation's case also, to reconsider Tika Ramji's case was rejected. The Court said:
"Tika Ramji notwithstanding, the contention was advanced by Shri Shanti Bhushan that `industry' was a pervasive expression, ambient enough to embrace raw materials used for the industry and so, sugar industry, as a topic of legislation, vested in Parliament exclusive power to legislate on sugar-cane supplies to sugar factories, and, pursuing this expansionist logic, any taxation on supplies of cane to mills would be legislation on sugar industry. Ergo the Purchase Tax Act was a usurpation by the U.P. legislature breaching the dykes of Article 246(1) read with Entry 52 of List I. He expanded on the theme by urging that any legislation which affected the sugar industry by taxing its raw materials was one with respect to that industry. The Tika Ramji ratio is diametrically opposed to this reasoning and a ruling which has stood the field so long has been followed by another Constitution Bench as late as 1973 in the Kannan Devan Hills Co. v. State of Kerala [(1973) 1 SCR 356] and its force of logic has our deferential assent and cannot be brushed aside by a mere appeal for reconsideration.
Shri Shanti Bhushan candidly conceded that if Tika Ramji were good law, his submission was still-born. We agree."
The Court further held that :
" `Industry' as a legislative topic is of large and liberal import; true. But what peripherally affects cannot be confused with what goes to the heart. An acquisition of land for sugar mills or of sugar mills may affect the industry but is not an action in the legislative field forbidden for the States (See the Kannan Devan Hills Produce Company Ltd. case).
Sales Tax on raw materials going to a factory may affect the costing process of the manufacture but is not legislation on industrial process or allied matters affect topics reserved for Parliament a situation of reductio ad absurdem may be reached."
(emphasis supplied is ours) The effect of acceptance of the submission of Mr. Shanti Bhushan may also denude the State of its power to legislate even in respect of sales tax on tobacco. Such a contention was specifically rejected in Ganga Sugar Corporation's case.
In The Kannan Devan Hills Produce v. The State of Kerala & Anr. [(1972) 2 SCC 218] challenge was laid to the constitutional validity of Kannan Devan Hills (Resumption of Lands) Act, 1971 for want of legislative competence of the State. The contention urged was that Sections 4 and 5 of the impugned Act are a law with respect to Entry 52 of List I of the Seventh Schedule as these provisions regulate the carrying on of tea industry, within the competence of the Parliament, by controlling the land for tea plantation. It was urged that if the effect of legislation is to control the working of the tea plantation, the legislation must be regarded as legislation with respect to Entry 52 List I. Tika Ramji's case was cited with approval. Repelling the contention, it was held that the State had legislative competence to legislate on Entry 18, List II and Entry 42, List III and this power cannot be denied on the ground that it has some effect on industry controlled under Entry 52, List I. The Constitution Bench further said that if a State Act, otherwise valid, has effect on a matter in List I, it does not cease to be a legislation with respect to an Entry in List II or List III. It said that effect is not the same thing as subject matter. The object of Sections 4 and 5 seems to be to enable the State to acquire all lands which do not fall within the categories (a), (b) and (c) of Section 4(1). These provisions are really incidental to the exercise of the power of acquisition. The State cannot be denied the power to ascertain what land should be acquired by it in the public interest.
In B. Viswanathiah & Co. & Ors. v. State of Karnataka & Ors. [(1991) 3 SCC 358] the challenge was to the validity of the provisions of Mysore Silkworm Seed and Cocoon (Regulation of Production, Suply and Distribution) Act, 1959 (Act 5 of 1960). The contention urged on behalf of the petitioners in that case was that any legislation in respect of silk industry can be enacted only by the Parliament and the State Legislature is incompetent to legislate on the matter because Section 2 of the Central Silk Board Act enacted a declaration in terms of Entry 52, List I. The effect of it was to remove the silk industry from the purview of the State Legislature powers thus, rendering the State Legislature incompetent to legislate on that topic. The High Court repelled the challenge relying upon the decision of this Court in Tika Ramji, Ganga Sugar Corporation Ltd., Harakchand Ratanchand Banthia and Kannan Devan Hills Produce Company's cases. After noticing that the High Court on the basis of series of decisions of this Court regarding scope of Entry 52 of List I in the Seventh Schedule of the Constitution had repelled the challenge, this Court expressed full agreement with the views of the High Court. It was held that the control of industry vested in Parliament was restricted to the aspect of production and manufacture of silk yarn or silk. It did not obviously take in the earlier stage of industry, namely, the supply of raw materials. For instance, even in regard to the silk industry, the reeling, production, development and distribution of silkworm seeds and cocoons was regulated by the State Act. These items can be perhaps legitimately described as raw materials of the silk industry. The control being vested in Parliament under Entry 52 of silk industry did not affect the control over these raw materials. It was held that the control, supply and distribution of the goods produced by the industry was the third aspect of industry which falls outside the purview of the control postulated under Entry 52. In other words, though the production and manufacture of raw silk cannot be legislated upon by the State Legislature in view of the provisions of the Central Act and the declaration in Section 2 thereof, that declaration does not in any way limit the powers of the State Legislature to legislate in respect of goods produced by the silk industry. This Court said that "To interpret Entry 52 otherwise would render Entry 33 in List III of the Seventh Schedule to the Constitution otiose and meaningless". The same would be the position in the present case.
The acceptance of the argument of Mr. Shanti Bhushan would make various Entries in the State List otiose and meaningless and subject to Entry 52 of List I despite the fact that the entries are not so worded.
In Indian Aluminium Company Ltd. & Anr. v. Karnataka Electricity Board & Ors. [(1992) 3 SCC 580] challenging the amending Act by the State, the contention urged before the High Court was that :
"Aluminium industry is scheduled industry under the control of the Government of India as declared by Industries Development and Regulation Act and hence falls under Entry 52 of List I of VIIth Schedule of the Constitution. Therefore, the policy of Government of India amounts to direction issued to the State Government which they are bound to obey. Consequently the agreement of 1976 is an agreement protected by a law coming under Entry 52 of List I, terms of which cannot be varied by a law enacted by a State by virtue of the power conferred by the Concurrent List (List III of VIIth Schedule). The amending Act should be construed in such a way as not to impinge on or detract from the law, statutory order or constitutional direction of the Central Government, otherwise the said amending Act will lack legislative competence."
The High Court relying upon the decision in Tika Ramji's case, where the concept of industry as a topic of legislation was explained, repelled the aforesaid contention. The decision and reasoning given by the High Court upholding the vires of the amending Act relating to the concept of industry as explained in Tika Ramji's case were upheld by this Court.
In M/s. Shriram Industrial Enterprises Ltd. v. The Union of India & Ors. [AIR 1996 All. 135] a Full Bench of Allahabad High Court examined the validity of U.P. Sheera Niyantran Adhiniyam, 1964 (U.P. Act No. XXIV of 1964) on the question of the competence of the State Legislature. Its validity had been challenged by the Sugar Industry. It was urged that by virtue of Section 18G of the IDR Act, the State Legislature stood denuded of power to legislate regulating supply, distribution and supplies of molasses a product of sugar industry and was consequently incompetent to enact Sections 7, 8 and 10 of the aforesaid State Act. The Full Bench tracing the history of legislation leading to framing of the Constitution held that if the argument about denuding of power of State Legislature is accepted, most of the entries in Lists II and III would be meaningless. Once the Parliament makes a declaration under Entry 52 of List I, for instance, Entries 20, 21, 22, 23 and 24 would be redundant. The High Court said that neither it was the intention of the framers of the Constitution nor the said contention is born out from the perusal of Entry 52 and the other Entries of Lists II and III of the Seventh Schedule. Noticing various decisions of this Court, the High Court concluded as under:
"Applying the principles propounded by the apex Court in the cases mentioned above, it is apparent that the State Legislature is competent to make law in respect of the subject industries under Entry 24 of the List II subject to Entries 7 and 52 of List I of the Seventh Schedule and is further competent to enact law on the subject "trade and commerce within the State and Production, supply and distribution of goods," under Entry 26 and Entry 27 of List II subject to Entry 33 of List III of Seventh Schedule of the Constitution. But on declaration under Entry 52 of List I by Parliament in respect of the industries the control of which by the Union is by law held to be expedient in the public interest, three consequences flow. Firstly, on declaration by Parliament in respect of controlled industries the power of State Legislature to legislate under Entry 24 of List II shifts to Entry 52 of List I to the extent of control provided in the Act. The second result which follows upon declaration is that the power to enact law by State Legislature under Entry 26 and Entry 27 of the List II of Seventh Schedule becomes part of Entry 33 of List III which is a concurrent list. Third consequence that follows on declaration is that the products of the controlled industries would fell within Entry 33 of List III.
The controversy before me, if examined seeing the constitutional debate, history of legislation, structure and design of the relevant entries and also keeping in view the basic structure of the Constitution, the only irresistible conclusion is that Section 18G of the IDR Act is referable to Entry 33 of List III of the Seventh Schedule. Since the power to enact in respect of production, supply and distribution of the products of the controlled industries being a concurrent subject, the U.P. Legislature is competent to enact the Adhiniyam of 1964."
The structure and scope of Entry 54 of the Union List and Entry 23 of the State List and their inter-relationship is substantially different from the scope and structure of Entry 24 of the State List and Entry 52 of the Union List. The Entry relating to of mines and minerals has in it both the industry of mines and its product minerals and, therefore, on a declaration both mines and minerals get embedded in Entry 54 of the Union List. Therefore, it has been consistently held by this Court, that by declaration under Entry 54, the Parliament evinces an intention to occupy the whole field. In my view the Full Bench rightly held that the cases relating to mines and minerals relied upon in support of the challenge to the State legislation were of no assistance. The Full Bench decision was approved by this Court in SIEL Ltd. & Ors. v. Union of India & Ors. [(1998) 7 SCC 26].
In Belsund Sugar Co. Ltd. v. State of Bihar & Ors. [(1999) 9 SCC 620], the Constitution Bench examined the question regarding the legality of levy of market fee under the provisions of Bihar Agricultural Produce Markets Act, 1960 pertaining to various commodities including sugarcane, sugar and molasses, wheat and tea. The Court first dealt with the transaction of purchase of sugarcane by the sugar factories functioning in the market areas falling within the jurisdiction of respective market committees constituted under the Market Act. It noticed that the Market Act had been enacted by the Bihar Legislature as per the legislative power vested in it by Entries 26, 27 and 28 of List II of the Seventh Schedule of the Constitution. The Court, however, noticed that the Market Act dealt with supply and distribution of the goods as well as the trade and commerce therein as it seeks to regulate the sale and purchase of agricultural produce to be carried on in the specified markets under the Act. To that extent, the Court said, the provisions of Entry 33 of List III override the legislative powers of the State Legislature in connection with legislations dealing with trade and commerce in, and the production, supply and distribution of goods. Thus, to the extent to which the Market Act seeks to regulate the transactions of sale and purchase of sugarcane and sugar which are foodstuffs and trade and commerce therein, the Constitution Bench said that it has to be held that the Market Act being enacted under the topics of legislative powers under Entries 26, 27 and 28 of List II will be subject to any other legislation under Entry 33 of the Concurrent List. The contention of Mr. Dwivedi being that as admittedly the tobacco is not foodstuff and does not fall under Entry 33 of List III, like the amendment to the Constitution made in 1953, the Parliament by further amendment of the Constitution can, if so advised, place tobacco raw material of the industry - in Entry 33 of List III and, thus, confer on itself the competence to legislate in respect to tobacco, need not be examined by this Court as being unnecessary. We may, however, note that the Constitution Bench, after noticing various provisions of the Act and the Rules, came to the conclusion that the need for regulating the purchase, sales, storage and processing of sugarcane, being an agricultural produce, is completely met by the comprehensive machinery provided by the Sugarcane Act enacted by the same very legislature which enacted the general Act being the Market Act.
In Belsund Sugar Co. Ltd. one of the contentions urged was that under the IDR Act, in public interest, Union of India had taken over the control of the wheat industry as specified in the First Schedule to the Act and consequently any transaction of purchase and sale of the product of that industry cannot be regulated by the State Act. The Constitution Bench noticed that the Parliament in exercise of its legislative power under Entry 52 of List I of the Seventh Schedule had enacted the IDR Act and flour industry is listed as one of the scheduled industries under the caption "Food- processing Industries". The Bench said that the production of wheat as a raw material or its sale is not covered by the said Act and, consequently, so far as wheat as `agricultural produce' is concerned, it is outside the sweep of the IDR Act. The question still remained whether the sale of flour or any other product out of wheat can be said to be covered by the sweep of the IDR Act. It was noticed that the Central Government had not promulgated any statutory order under Section 18G covering the field. The Court rejected the contention that mere existence of a statutory provision in the Act enabling the Central Government to issue such order would be sufficient to occupy the field contemplated by the provision. While examining the decision in Hingir-Rampur Coal Company's case on which reliance was placed by the appellants, the Constitution Bench held that it has to be kept in view that any legislation in exercise of legislative power under Entry 54 of List I would enable the Parliament to regulate mines and the minerals development by taking them under the control of the Union in public interest. Thus, all aspects of the mining industry would be covered by the general sweep of such a declaration. But it was noticed that the IDR Act was enacted under Entry 52. It was held that the scheme of Entry 54 of the Union List read with Entry 23 of the State List was entirely different from the scheme of Entry 52 of List I read with Entry 24 of List II with which the Court was concerned in that case. On conjoint reading of these two entries, the ratio of the decision in Hingir-Rampur Coal Company's case, it was held, cannot be effectively pressed into service.
As already noticed, the majority decision in ITC case for the view it took had placed reliance on Baijnath Kadio which followed Hingir-Rampur Coal Company's case.
Further in Belsund Sugar Company, the Constitution Bench cited with approval the decision in SEIL case and reiterated that merely because industry is controlled by a declaration under Section 2 of the IDR Act enacted by Entry 52 of the Union List, the State Legislature would not be denied of its power to regulate the products of such an industry by exercise of its legislative power under the State List. It would be useful to extract para 119 of Belsund Sugar Company's case as under :
"However, so far as the IDR Act is concerned, it is enacted under Entry 52 of the First Schedule which deals with industries in general. Simultaneously in the State List itself there is Entry 24 which deals with industries subject to the provisions of Entries 7 and 52 of List I. Consequently, the products of such controlled industries would necessarily not be governed by the sweep of the general legislation pertaining to such industries as per Entry 52 of the Union List.
The aforesaid Constitution Bench judgment was not concerned with any State legislation enacted under Entry 24. On the contrary, it dealt with legislation of the Union Parliament under Entry 54 of the Union List read with Entry 23 of the State List. The scheme of the aforesaid legislative entries is entirely different from the scheme of Entry 52 of List I read with Entry 24 of List II with which we are concerned. On a conjoint reading of the aforesaid two entries, therefore, the ratio of the decision of the Constitution Bench in the aforesaid case cannot be effectively pressed into service by Shri Ranjit Kumar for supporting his contention. In this contention, we may usefully refer to a decision of this Court in SIEL Ltd. where one of us, Sujata V.
Manohar J. was a member. It has rightly distinguished the ratio of the Constitution Bench decision in the case of Hingir Rampur Coal co. Ltd. and taken the view that merely because an industry is controlled by a declaration under Section 2 of the IDR Act enacted by Entry 52 of the Union List, the State Legislature would not be denied of its powers to regulate the products of such an industry by exercise of its legislative powers under Entry 24 of the State List. In that case the question was whether the U.P. Sheera Niyantran Adhiniyam, 1964 could be said to be repugnant to the Molasses (Control) Order issued by the Central Government under Section 18-G of the IDR Act imposing restrictions on the sale of molasses and fixing the maximum price of molasses. Answering the question in the negative, it was held that the term `industry' in Entry 24 would not take within its ambit trade and commerce or production, supply and distribution of goods which are within the province of Entries 26 and 27 of List II. Similarly, Entry 52 in List I which deals with industry also would not cover trade and commerce in, or production, supply and distribution of, the products of those industries which fall under Entry 52 of List I. For the industries falling in Entry 52 of List I, these subjects are carved out and expressly put in Entry 33 of List III. It was also held that since the Molasses (Control) Order of 1961 passed by the Central Government in exercise of powers conferred by Section 18-G was not extended at any point of time to the State of U.P. or the State of Bihar, the question of repugnancy between the Molasses Control Order, 1961 and the U.P. Sheera Niyantran Adhiniyam, 1964 does not arise. Consequently, it must be held that in the absence of a statutory order promulgated under Section 18-G of the IDR Act, it cannot be said that the field for regulation of sale and purchase of products of the flour industry like atta, maida, suji, bran, etc. would remain outside the domain of the State Legislature."
(emphasis supplied is ours) The principles aforesaid would equally apply to Entries 14 27, 28 and 66 of List II. It may further be noticed that in para 170 of Belsund Sugar Company's case, the Constitution Bench reiterates the view expressed in Tika Ramji's case as also in SIEL's case affirming Full Bench of the Allahabad High Court in M/s. Shriram Industrial Enterprises (supra).
In view of the above, I see no compelling reason either on account of any binding precedent in the form of a earlier Constitution Bench judgment, history and background of the framing of the Constitution or the words used in various Entries or the language of any Article in the Constitution of India, to take a view which will result in denuding the power of State Legislatures to legislate not in respect of field of legislation under Entry 24 but field of legislation covered by other entries on State List on making of declaration under Entry 52 of the Union List. The Constitution Bench judgment in the case of Tika Ramji and other decisions following it confine the field of legislation of industries to `the process of manufacture or production' and not to `raw materials' which may be integral part of industrial process or to the `distribution of the product of the industry'.
In view of the aforesaid, I conclude as under :
1. The State legislations and the Tobacco Board Act, 1975 to the extent of sale of tobacco in market area cannot co-exist.
2. The State Legislatures are competent to enact legislations providing for sale of agricultural produce of tobacco in market area and for levy and collection of market fee on that produce.
3. The Parliament is not competent to pass legislation in respect of goods enumerated in aforesaid conclusion No.2 while legislating in the field of legislation covered by Entry 52 of the Union List under which the Parliament can legislate only in respect of industries, namely, `the process of manufacture or production' as held in Tika Ramji's case. The activity regarding sale of raw tobacco as provided in the Tobacco Board Act cannot be regarded as `industry'.
4. ITC's case [1985 Supp. SCC 476] is not correctly decided.
Leave in special leave petitions granted. For the aforesaid reasons, the State legislations are held to be valid pieces of legislation. The appeals and the writ petition are disposed of accordingly. Parties to bear their own costs.
..........................................J. [Y.K. Sabharwal] January 24, 2002