- 1 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 IN THE HIGH COURT OF KARNATAKA,AT DHARWAD DATED THIS THE 12TH DAY OF SEPTEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV WRIT PETITION NO.107231 OF 2015 (GM-PDS) BETWEEN: M/S. MUTH WAGHAMAL BURAJI R/BY SRI. RAMESH BAFNA AGE: 55 YEARS, OCC: BUSINESS, R/O. BYAHATTI PLOT, DESHPANDE NAGAR, HUBBALLI, TQ: HUBBALLI, DIST: DHARWAD. …PETITIONER (BY SRI. CHETAN T. LIMBIKAI, ADVOCATE) AND: 1. THE STATE OF KARNATAKA, R/BY ITS SECRETARY/APPELLATE AUTHORITY, DEPARTMENT OF FOOD AND CIVIL SUPPLIES, M.S. BUILDING, BENGALURU. 2. THE DISTRICT COMMISSIONER, D.C. COMPOUND, DHARWAD. 3. THE DEPUTY DIRECTOR, FOOD AND CIVIL SUPPLIES, DHARWAD. …RESPONDENTS (BY SRI. V.S. KALASURMATH, AGA FOR R1 TO 3) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT IN THE NATURE CERTIORARI BY QUASHING THE IMPUGNED ORDERS AS PER ANNEXURE-B & C C£Á¸À 01 E¹J 2009 & ¸ÀA/J¸ïAiÀÄĦ/E¹/¹Dgï.12/08-09 DATED 17.04.2015 AND 24.06.2015 RESPECTIVELY TO RECOVER RS.26.50 LAKHS TOWARDS THE COST OF THE RICE OF 1406.80 QUINTALS FROM THE PETITIONER AS LAND REVENUE BE KINDLY SET ASIDE TO MEET THE ENDS OF JUSTICE & ETC. THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV Digitally signed by SAMREEN AYUB DESHNUR Location: High Court of Karnataka, Dharwad Bench - 2 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 ORAL ORDER (PER: THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV) The present petition has been filed calling in question the correctness of the order at Annexure-B dated 17.04.2015 by the appellate authority. In the said appeal, the order of the Deputy Commissioner dated 19.12.2008 was called in question. The petitioner has also called in question the order at Annexure-C dated 24.06.2015 passed by the Deputy Commissioner. 2. In terms of the order at Annexure-C, the petitioner was called upon to pay an amount of Rs.26.50 lakhs, which is equivalent to the quantity of rice in his possession in excess of 1500 quintals. 3. It is to be noticed that in terms of the order of the Deputy Commissioner dated 19.12.2008, the Deputy Commissioner had recorded a finding that the petitioner had a stock of an extent of 3650.80 quintals of rice in excess of permissible limit of 1500 quintals. It was recorded that under the Karnataka Essential Commodities Licensing - 3 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 (Amendment) Order 2008, there was a violation of Clause 12 of the Licensing Order 1986. While noticing that stock held by the petitioner at 5180.80 quintals of rice, the amount of rice in excess of 1500 quintals namely 3650.80 quintals was directed to be seized in exercise of power under Section 6(a) of the Karnataka Essential Commodities Act, 1955. 4. By virtue of the findings in the said order, the Deputy Commissioner had referred to the relevant gazette notification and rejected the contention of the petitioner. This order of the Deputy Commissioner came to be challenged before the respondent No.1-appellate authority, which authority has modified the order and directed for seizing of 1406.80 quintals of rice. The appellate authority modified the order of the Deputy Commissioner by ordering for exclusion of broken rice of 2244.00 quintals. Simultaneous with passing of an order at Annexure-B, the order was passed by Deputy Commissioner at Annexure-C, which was a consequential order. - 4 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 5. Learned counsel Sri.Chetan T. Limbikai appearing for the petitioner has assailed the orders including the appellate order at Annexure-B and the order of the Deputy Commissioner passed pursuant to the order at Annexure-B. The contentions of the petitioner are that by virtue of the notification of the Central Government dated 15.02.2002 bearing No.G.S.R.104(E) under Clause 3 of the said notification, there was no restriction to stock or sell rice/paddy. It is accordingly contended that the State Government could not have imposed any restriction on such activity. 6. The other contention raised is relating to the power of search and seizure. It is submitted that in terms of the procedure prescribed under the Karnataka Essential Commodities (Public Distribution System) Control Order, 1992, Clause 19 provides for power of entry, search and seizure and Clause 19 (2) provides that the procedure under Section 100 of Cr.P.C ought to be followed, failing which the search and seizure is required to be set aside. Reliance is - 5 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 placed on the order passed in Crl.P. No.100562/2022. It is contended that once the procedure of search and seizure is not in accordance with law, the proceedings culminating in order of confiscation could not stand in light of non adherence to law. 7. Learned AGA Sri.V.S.Kalasurmath appearing for the State would submit that the action initiated is for maintaining of stock beyond the permissible limit. It is submitted that the limit of storage quantity is stipulated under the Karnataka Essential Commodities Licensing (Amendment) Order 2008 published in the Karnataka Gazette on 06.06.2008 vide notification No.FCS21RPR08, dated 24.05.2008. It is submitted that in terms of the said notification at Schedule-2 at item No.5, the limit of maintaining stock of rice is 1,500 quintals. It is contended that the Amendment Order 2008 is pursuant to notification issued by the Government of India on 31.08.2007 and this would supersede the notification relied on by the petitioner dated 15.02.2002. It is further submitted that the grounds raised by the petitioner before this Court at - 6 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 the time of arguments were not raised before the appellate authority, which proceedings culminated in passing of orders at Annexure-B. Further it is submitted that even in the present writ petition, there is only a passing reference to violation of the procedure for search and seizure. It is finally contended that even otherwise, any breach in procedure of search and seizure cannot have the effect of nullifying the order of confiscation in light of the admitted stand of the petitioner before the authority in his reply submitted to the show-cause notice dated 11.11.2008. It is submitted that there is a clear admission in the reply to the show-cause notice that the stock of rice was maintained without realizing the limit as per the Government notification dated 24.05.2008, which the petitioner was not aware of. Accordingly, it is contended that once there is an admission of maintenance of stock without knowing the restrictions under the State Government notification dated 24.05.2008, the violation, if any, cannot have the effect of nullifying the orders at Annexure-B as well as the consequential order at Annexure-C. It is further submitted that the procedure under Section 100 of Cr.P.C is - 7 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 required to be adhered to only in the event of the procedure initiated by the authority consequent to the registration of the criminal case. It is submitted that the present proceedings are initiated only in the context of violation of conditions of license that is granted. 8. Heard both sides. 9. At the outset, it must be noticed that under the Licensing Order 2008, Clause 12 provides for a ceiling of posession of any one or more essential commodities. Clause 12 reads as follows; “12. Ceiling on possession of any one or more essential commodities by person other than a dealer, permit holder and bulk consumer.- No person shall hold any one or more essential commodities in his possession for any purpose more than such of the quantity as may be prescribed by the Central or State Government by Notification in this behalf from time to time.” 10. No doubt the Government of India as per the notification dated 15.02.2002 vide notification bearing No.GSR104(E) had provided rights for stocking and selling - 8 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 paddy/rice without permit or license, however, the said notification is superseded by the notification of the State Government by “Karnataka Essential Commodities Licensing (Amendment) Order 2008” published in the Karnataka Gazette Extraordinary No.552 dated 06.06.2008 vide notification No.FCS21RPR08 dated 24.05.2008. The preamble to the said notification is extracted below; “In exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955 (Central Act 10 of 1955), read with Order No. S.O.681(E), dated 30- 11-1974 of Ministry of Industries and Civil Supplies (Department of Civil Supplies and Co-operation) and Order No.GSR 490(E), dated 16-6-2003. S.O. 1373(E), dated 29-8-2006, S.O. 297(E), dated 27-2-2007 and S.O. 1488(E), dated 31-8-2007 issued by the Government of India, Ministry of Consumer Affairs and Public Distribution (Department of Consumer Affairs), New Delhi, the Government of Karnataka hereby makes the following order further to amend the Karnataka Essential Commodities Licensing Order, 1986, namely.” 11. The perusal of the same would indicate that the said notification is issued pursuant to the notification of the Government of India dated 31.08.2007 as well as other - 9 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 Orders of the Central Government more fully referred to in the preamble extracted above. If that where to be so, the notification of the Central Government dated 15.02.2002 stands superseded. 12. There is force in the submission of the learned AGA appearing for the State as regards the stand of the petitioner in the reply to the show-cause notice. In the reply to the show-cause notice, the only defence taken by the petitioner is that, he was not aware of the restriction imposed by the notification of the Government and was under the impression that there was no restriction in terms of the earlier Central Government notification dated 15.02.2002. The original records were provided at the time of arguments and this Court has perused the reply made by the show-cause notice. This stand is also reflected in the order at Annexure-A dated 19.12.2008 in the second paragraph. If the consistent stand of the petitioner that he was not aware of the restrictions, insofar as the contention relating to procedural violation while making of search or seizure it would suffice to state, without entering - 10 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 into such aspect that the petitioner is not in a position to show how his right has been prejudiced. It is in fact the unequivocal stand in the reply to the show-cause notice, in which effectively he admits regarding holding of grains beyond the specified limits. In fact, the petitioner unequivocally submits that there is a mistake on his part in the reply to the show- cause notice and seeks for dropping of the proceedings. In fact, the petitioner has made a request for amendment of the ceiling limit in his reply to the show-cause notice. Accordingly, even if there is any lapse in the procedure of search, there is no case made out of prejudice to the petitioner. Further, such ground has not been raised either before the Deputy Commissioner while passing the order at Annexure-A, or before the appellate authority. 13. It is also necessary to notice that the petitioner has admitted that he has not renewed his license. If that where to be so, such violation in procedure of not possessing the license, would also be an aspect that has been taken note while passing an order. Before the appellate authority in the - 11 - HC-KAR NC: 2025:KHC-D:11953 WP No. 107231 of 2015 order passed at Annexure-B, the petitioner was granted some relief insofar as the order at Annexure-A was modified by decreasing the confiscation by excluding 2244.00 quintal of broken rice. The order at Annexure-C is only consequential order. This Court finds no reason to interfere with the orders impugned and accordingly, the petition is rejected. 14. It is noticed that the amount of Rs.10 lakhs deposited through Demand Draft dated 23.07.2015 bearing No.069729 has been taken as deposit before the Court. The said amount (deposit and interest if any) to be transferred to the State and learned AGA submits that necessary memo with details of RTGS and Account Number would be filed within three days. It is needless to state that if there are any dues remaining after transfer of the amount before this Court, State is at liberty to recover the same in accordance with law. Sd/- (S.SUNIL DUTT YADAV) JUDGE PJ, CT:VP LIST NO.: 1 SL NO.: 1