APHC010014362019 IN THE HIGH COURT OF ANDHRA PRADESH TUESDAY,THE TWENTY FOURTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY SIX THE HONOURABLE SRI JUSTICE RAVI CHEEMALAPATI WRIT PETITION NO: Between: 1. M/S S.S.TRANSPORT, REP. BY ITS PARTNER, VASIREDDY KRUPAKARA RAO, S/O. SRIKRISHNAIAH, HAVING OFFICE AT SHANTHI NAGAR, OPP. HANUMAN TEMPLE, JAGGAIAHPETA, KRISHNA DISTRICT 1. STATE OF AP, REP. BY ITS SECRETARY, FOOD AND CONSUMER AFFAIRS DEPARTMENT, SECRETARIAT BUILDINGS, VELAGAPUDI, GUNTUR DISTRICT 2. THE COLLECTOR CS, KRISHNA DISTRICT AT MACHILIPATNAM. 3. THE TAHSILDAR, IBRAHIMPATNAM MANDAL, KRISHNA DISTRICT. 4. THE CHIEF MANAGER, SYNDICATE BANK HYDERABAD. 5. THE COLLECTORCS, KRISHNA DISTRICT AT MACHILIPATNAM 6. THE TAHSILDAR, IBRAHIMPATNAM MANDAL, KRISHNA DISTRICT 7. THE CHIEF MANAGER, SYNDICATE BANK, AMEERPET BRANCH, HYDERABAD 1 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) TUESDAY,THE TWENTY FOURTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY SIX PRESENT THE HONOURABLE SRI JUSTICE RAVI CHEEMALAPATI WRIT PETITION NO: 638/2019 M/S S.S.TRANSPORT, REP. BY ITS PARTNER, VASIREDDY KRUPAKARA RAO, S/O. SRIKRISHNAIAH, HAVING OFFICE AT SHANTHI NAGAR, OPP. HANUMAN TEMPLE, JAGGAIAHPETA, KRISHNA DISTRICT ...PETITIONER AND STATE OF AP, REP. BY ITS SECRETARY, FOOD CIVIL SUPPLIES AND CONSUMER AFFAIRS DEPARTMENT, SECRETARIAT BUILDINGS, VELAGAPUDI, GUNTUR DISTRICT THE COLLECTOR CS, KRISHNA DISTRICT AT MACHILIPATNAM. THE TAHSILDAR, IBRAHIMPATNAM MANDAL, KRISHNA DISTRICT. THE CHIEF MANAGER, SYNDICATE BANK, AMEERPET BRANCH, THE COLLECTORCS, KRISHNA DISTRICT AT MACHILIPATNAM THE TAHSILDAR, IBRAHIMPATNAM MANDAL, KRISHNA DISTRICT THE CHIEF MANAGER, SYNDICATE BANK, AMEERPET BRANCH, ...RESPONDENT(S): RC,J W.P.No.638 of 2019 IN THE HIGH COURT OF ANDHRA PRADESH [3332] TUESDAY,THE TWENTY FOURTH DAY OF FEBRUARY THE HONOURABLE SRI JUSTICE RAVI CHEEMALAPATI M/S S.S.TRANSPORT, REP. BY ITS PARTNER, VASIREDDY KRUPAKARA RAO, S/O. SRIKRISHNAIAH, HAVING OFFICE AT SHANTHI NAGAR, OPP. HANUMAN TEMPLE, JAGGAIAHPETA, ...PETITIONER CIVIL SUPPLIES AND CONSUMER AFFAIRS DEPARTMENT, SECRETARIAT THE COLLECTOR CS, KRISHNA DISTRICT AT MACHILIPATNAM. THE TAHSILDAR, IBRAHIMPATNAM MANDAL, KRISHNA DISTRICT. , AMEERPET BRANCH, THE COLLECTORCS, KRISHNA DISTRICT AT MACHILIPATNAM THE TAHSILDAR, IBRAHIMPATNAM MANDAL, KRISHNA DISTRICT THE CHIEF MANAGER, SYNDICATE BANK, AMEERPET BRANCH, ...RESPONDENT(S): RC,J W.P.No.638 of 2019 2 Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropriate writ, or order or direction more particulalrly one in the nature of Writ of Mandamus declaring the action of the 2nd respondent in forfeiting the Bank Guarantee No. 13/2015 furnished by the petitioner in favor of the Government vide order in ECP No. 91/2015, dated 29-12-2018 passed by the 2nd respondent is highly illegal arbitrary and unconstitutional being violative of principles of natural justice and consequently set aside the impugned order in ECP No. 91/2015, dated 29-12- 2018 passed by the 2nd respondent and thereby direct the respondents 2 and 3 herein to release the Bank Guarantee No. 13/2015 in favour of the petitioner and pass IA NO: 1 OF 2019 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to suspend the operation of the impugned order in E.C.P. No. 91/2015, dated 29-12-2018 passed by the 2nd respondent and thereby direct the respondents 2 and 3 herein to release the Bank Guarantee No. 13/2015 in favour of the petitioner, pending disposal of the writ petition Counsel for the Petitioner: 1. K SRINIVAS Counsel for the Respondent(S): 1. GP FOR CIVIL SUPPLIES (AP) The Court made the following: RC,J W.P.No.638 of 2019 3 ORDER Questioning the action of respondent no.2 in passing orders dated 29.12.2018 vide E.C.P.No.91 of 2015 forfeiting Bank Guarantee No.13 of 2015 furnished by the petitioner in favour of the Government. 2. The case of the petitioner, in brief, is that, on 07.07.2015, while the lorry bearing No.AP 16 TY-8513 was carrying the load of cement bags, the Vigilance and Enforcement officials intercepted the same at Ibrahimpatnam, Krishna District and seized the lorry along with cement bags and 51 bags of rice and in that connection a case in Cr.No.171 of 2015 under Section 420 of IPC and Section 7(C) of the Essential Commodities Act, 1955 was registered against the petitioner and others. That the petitioner filed W.P.No.21734 of 2015 and the Hon’ble High Court by order dated 22.07.2015 disposed of the same, directing respondent no.2 to release the lorry and the stock upon furnishing bank guarantee for an amount of Rs.10 lakhs and accordingly the bank guarantee was furnished and the lorry and stocks were released to the petitioner. It is the further case of the petitioner that as per Panchanama conducted by the Inspecting Officials , the allegations leveled against the petitioners and others is that they purchased the PDS rice from the cardholders meant for Public Distribution System and selling the same at higher rates by doing clandestine business. It is the further case of the petitioner that without considering the written arguments submitted, the RC,J W.P.No.638 of 2019 4 respondent no.2 passed the impugned order under Section 6(A) of the EC Act ordering confiscation of 100% of the seized stock and forfeited the Bank guarantee amount of Rs.10,00,000/- furnished by the petitioner, which is contrary to the judgment of this Court in Maimuna Begum vs. State of Telangana and others1. Hence, the writ petition. 3. Heard Sri K.Srinivas, learned counsel for the petitioner, and Sri Vineeth Appasani, learned Assistant Government Pleader for Civil Supplies. 4. Sri K.Srinivas, learned counsel, while reiterating the contents of the writ affidavit would contend that since the entire 6A rests on the footing that the petitioner and other purchased PDS rice meant for Public Distribution System from cardholders, the provisions of Control Order, 2008 do not attract, since the commodity had reached the cardholder. He would further contend that when once the provisions of the Control Order, 2008 are not applicable, registration of case under Section 6(A) of the Essential Commodities Act and forfeiting the bank guarantee by passing the impugned orders is arbitrary, unsustainable. Accordingly, prayed to allow the writ petition. In support of his contentions, the learned counsel relied on the decision reported in Maimuna Begum vs. State of Telangana and others (supra 1). 1. 2016 SCC OnLine Hyd 206 RC,J W.P.No.638 of 2019 5 5. On the other hand, Sri Vineeth Appasani, learned Assistant Government Pleader, would contend that since the petitioner along with others indulged in purchase and sale of PDS rice meant for public distribution system, the authorities registered case under Section 6(A) of the Act and after affording fair and reasonable opportunity passed the impugned order. He would further contend that there is neither illegality nor procedural irregularity in passing the impugned orders and hence the same does not require any interference of this court and therefore, the writ petition being meritless deserves dismissal. Accordingly, prayed to dismiss the writ petition. 6. Perused the material available on record and considered the submissions made by learned counsel for the parties. 7. As per the panchanama, the rice that was seized in the lorry of the petitioner was purchased from the cardholders at Rs.10/- per Kg. and after getting it polished in a rice mill, the same was being sold at Rs.17/- per kg. 8. In the decision relied on by the learned counsel for the petitioner in Maimuna Begum vs. State of Telangana and others (supra 1), a Division Bench of this Court held thus: “9. Clause 17 of the Control Order, 2008 envisages penalties for possessing cards, making false entries or diverting stock. The learned Government Pleader conceded that the said Clause applies to fair price shop dealers, nominated retailers and hawkers and therefore the same has no application to the detenus who do not fall in any of these categories. RC,J W.P.No.638 of 2019 6 10. The only other Clause on which the learned Government Pleader placed reliance is Clause 17(A) of the Control Order, 2008 which reads as under: 17(A) Interruption in the process of Distribution : - No Fair Price Shop dealer or card holder or any person shall be allowed to cause interruption or interfere with the process of smooth distribution of scheduled commodities under Public Distribution system or other Government schemes at any level right from Food Corporation of India godown point to Fair Price Shop point, till the scheduled commodity reaches the intended beneficiary. Any such attempt of interruption or interfering with such process shall be treated as an abetment and be deemed to have contravened this order, thereby committing an offence under Section 8 of the Essential Commodities Act, 1955. 11. A careful reading of the above re-produced Clause shows that the same is attracted if a fair price shop dealer or cardholder or any person causes interruption or interferes with the smooth distribution of scheduled commodities under the public distribution system or other Government schemes at any level right from the Food Corporation of India godown to the fair price shop point, till the scheduled commodity reaches the intended beneficiary. From the unequivocal plain language of this provision, it is clear that it gets attracted when there is interruption of food grains from the stage of FCI godown till it reaches the end beneficiary i.e., cardholders. The provision does not comprehend any activity relating to any commodity falling under the Control Order, 2008 once it reaches the cardholder. There is no whisper either in the detention order or in the grounds of detention that any of the detenus is interrupting the smooth functioning of the scheduled commodities from the FCI godown point till it reaches intended beneficiary. On the contrary, the whole allegation against the detenus is that they have been purchasing the PDS rice from the cardholders. Therefore, this activity of the detenus completely falls outside Clause 17(A) of the Control Order, 2008. Once there is no prohibition on such activity either under the 1995 Act or under the Control Order, 2008 which undisputedly is the only Order that governs distribution and control of rice meant for public distribution system, the detenus cannot be accused of committing any offence. As the respondents failed to show that the detenus have contravened the provisions of any other Control Order framed under Section 3 of the 1995 Act, the alleged activities of the detenus are not liable for any penal action. Once their activities do not constitute an offence under law, their preventive detention under the provisions of the 1980 Act cannot be sustained.” 9. The above observations clearly shows that unless there was interruption of smooth functioning of the scheduled commodities from the FCI RC,J W.P.No.638 of 2019 7 godown point till it reaches intended beneficiary/cardholder, the clauses of 17 of the Control Order, 2008 cannot be made applicable. 10. In the instant case, the entire 6A case was founded that the petitioner and others purchased PDS rice from the cardholders and therefore they stand outside the purview of the clauses of Control Order, 2008 and their activity completely falls outside clause 17(A) of the Control order, 2008, which was not prohibited either under Essential Commodities Act or under any of the clauses of the Control Order, 2008. Therefore, the impugned orders forfeiting the Bank guarantee furnished by the petitioner to the Government is unsustainable and the same has to be set aside. 11. Accordingly, the writ petition is disposed of, setting aside the order dated 29.12.2018 passed by respondent no.2-The Collector (CS), Krishna District, vide ECP No.91/2025 and the authorities shall release the said bank guarantee in favour of the petitioner forthwith. There shall be no order as to costs Pending miscellaneous petitions, if any, shall stand closed. ________________________ JUSTICE RAVI CHEEMALAPATI 24TH February, 2026 RR