IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
WEDNESDAY, THE 8TH DAY OF JUNE 2022 / 18TH JYAISHTA, 1944
WP(C) NO. 26941 OF 2021
PETITIONER/S:
N.R.JOHNSON
AGED 50 YEARS, S/O.RAPHAEL,
NAMBIATTUKUDY HOUSE, ANGAMALY P.O.,
ERNAKULAM DISTRICT-683572.
BY ADV MEREENA.J.JOSEPH
RESPONDENT/S:
1 GOVERNMENT OF INDIA
REPRESENTED BY THE SECRETARY,
DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION,
MINISTRY OF CONSUMER AFFAIRS,
FOOD AND PUBLIC DISTRIBUTION,
SANSAD BHAVAN, KRISHI BHAVAN,
NEW DELHI-110001.
2 FOOD CO-ORPORATION OF INDIA
16-20, BARAKHAMBA LANE,
NEW DELHI-110001, INDIA,
REPRESENTED BY ITS MANAGING DIRECTOR.
3 STATE OF KERALA
REPRESENTED BY THE SPECIAL SECRETARY,
FOOD CIVIL SUPPLIES CONSUMER AFFAIRS DEPARTMENT,
ROOM NO.S-210 (OLD-644), 2ND FLOOR,
SOUTH BLOCK, SECRETARIAT, STATUE,
THIRUVANANTHAPURAM-695001.
4 KERALA STATE CIVIL SUPPLIES CORPORATION,
MAVELI BHAVAN, GANDHINAGAR ROAD,
GANDHINAGAR, KADAVANTHRA,
KOCHI, KERALA-682020,
REPRESENTED BY ITS MANAGING DIRECTOR.
BY ADVS.
K.R.KRISHNAKUMARI,SC, FCI
SMT.MOLLY JACOB,SC,SUPPLYCO
SHRI.K.P.JAYACHANDRAN, ADDL. ADVOCATE GENERAL
W.P(C).26941/2021
2
OTHER PRESENT:
S.MANU, ASST. SOLICITOR GENERAL,
SRI.S. RENJITH, SPL. GOVERNMENT PLEADER
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 08.06.2022, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:
W.P(C).26941/2021
3
JUDGMENT
Dated this the 8th day of June, 2022 Shaji P. Chaly, J.
Instant public interest writ petition is filed seeking the following reliefs:
"i) call for the entire records pertaining to the issuance of Exhibit P1, and issue a Writ of Certiorari, any other writ, order or direction to quash the same.
ii) Declare by way of any writ, order or direction that the out turn-ratio fixed by 3rd respondent as 64.5% instead of existing 68%, is ultra vires of the Constitution of India."
2. The brief facts necessary for disposal of the writ petition are that; petitioner, he is an agriculturist, engaged in paddy cultivation. Petitioner prefers this public interest writ petition, challenging the constitutionality of Exhibit-P1 Order issued by the State Government, re-fixing the out turn ratio of food grain from 68% to 64.5% to favour rice Mill owners. It is submitted by the petitioner that the Government of India has established the Indian Food Security System under the Ministry of Consumer Affairs, Food and Public Distribution System to distribute food. It is W.P(C).26941/2021 4 further submitted by the petitioner that the Central Government procures food grains under two methods and extends price support for the grains i.e., under the centralized procurement system and decentralized procurement system. Kerala is procuring rice under the decentralized procured system with effect from 2004. The State Government procures rice through Kerala State Civil supplies Corporation popularly known as SUPPLYCO.
3. According to the petitioner, as per the FCI guidelines, the nodal agencies, i.e; the Mill owners, have to return 68 kg of rice to the SUPPLYCO, after processing one quintal of paddy. As per the quality standards of paddy, if the moisture content of paddy is 17%, the quantity of output as rice will be 68 Kg per one quintal. This is the guideline fixed by FCI and the reimbursement made by the Government of India is based on these guidelines to the State Governments all over India, including Kerala. It is these guidelines which have been relaxed by issuing Exhibit P1 by the State of Kerala. Hence, the instant writ petition is filed by the petitioner challenging Exhibit P1 order of the State Government.
4. Government Order dated 18.8.2018 (Exhibit P1) is under challenge in this writ petition, which is reproduced hereunder: W.P(C).26941/2021 5 "GOVERNMENT OF KERALA Synopsis Public Distribution Department - Paddy Procurement Decentralized procurement Processing Distribution - Order issued to reduce out-turn-ratio from 68% to 64.5%.
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Department of Food Public Distribution (C) G.O.No.34/2018/F.P.D.D Dated, Thiruvananthapuram.
18.08.2018
-------------------------------------------------------------------------------------- Reference:- Proceedings dated 11.01.2018 of the meeting presided over by the Hon'ble Chief Minister.
---------
(1) In the process of decentralized grain procurement and processing related to paddy procurement, 68% of the rice out of the 1 quintal paddy procured as per Central Government norms will be returned to the Central Pool. However, a committee was set up by the State Government to look into the matter scientifically, and on the basis of complaints from Mill owners that 68% of the paddy stockpiled due to natural and climatic changes in the state is not being returned after process, and only 64.5% of raw paddy would be available per quintal of paddy as out-turn-ratio after scientific tests and milling. On the basis of this ratio the Central Government has been approached requesting reduction of out-turn-ratio to 64.5%.
(2) The State will compensate the financial commitment that will result for fixing the out-turn-ratio of 1 quintal paddy as 64.5% instead of 68% of rice during the process of decentralized procurement, processing and distribution, until W.P(C).26941/2021 6 the Central Government accepts the norms.
By order of the Governor Mini Antony I.A.S.
Government Secretary."
5. The 2nd respondent, Food Corporation of India has filed a very detailed counter affidavit, which basically supports the contentions advanced by the writ petitioner. It is submitted that the Food Corporation of India is bestowed with the task of ensuring food security of the country by way of undertaking procurement, storage and distribution of food grains. It is also submitted therein that it is guided by the provisions of National Food Security Act, 2013, which was enacted with the object of providing food and nutritional security in human life cycle approach, by ensuring access to adequate quantity of quality food at affordable prices to people to live a life with dignity.
6. We think that the contentions raised by the Food Corporation of India, in its counter affidavit, relying upon the provisions of National Food Security Act, 2013 would be worthwhile to be narrated, in order to arrive at a reasonable and logical conclusion in the writ petition.
W.P(C).26941/2021 7
7. The National Food Security Act, 2013 (hereinafter referred to as "the Act") was enacted with the object to provide for food and nutritional security in human life cycle approach, by ensuring access to adequate quantity of quality food at affordable prices to people to live a life with dignity.
8. Sections 2(2) and 2(10) of the Act define "central pool" and "minimum support price" respectively as follows:
"2. Definition.-- In this Act, unless the context otherwise requires,--
(2) central pool" means the stock of foodgrains which is, -
(i) procured by the Central Government and the State Governments through minimum support price operations;
(ii) maintained for allocations under the Targeted Public Distribution System, other welfare schemes, including calamity relief and such other schemes;
(iii) kept as reserves for schemes referred to in sub-clause (ii).
(10) "minimum support price" means the assured price announced by the Central Government at which food grains are procured from farmers by the Central Government and the State Governments and their agencies, for the central pool.
9. As per Section 22(1) of the Act, the Central Government shall allocate from the central pool the required quantity of food grains to the State Governments under the Targeted Public Distribution System. Section 22(4) of the Act W.P(C).26941/2021 8 enables the Central Government, without prejudice to sub-section (1), to procure food grains for the central pool through its own agencies and the State Governments and their agencies. Section 24 of the Act stipulates that the State Government shall be responsible for implementation and monitoring of the schemes of various Ministries and Departments of the Central Government in accordance with guidelines issued by the Central Government for each scheme. and their own schemes, for ensuring food security to the targeted beneficiaries in their State.
10. It is further stated by FCI that as far as the averments in paragraphs 2 to 5 are concerned, FCI and State agencies procure food grains under central pool. Food grains procured by State agencies are handed over to FCI or directly distributed to beneficiaries against Govt of India allocation. State government through fair price shops, distributes food grains lifted from FCI or procured by State agencies to beneficiaries against Govt. of India allocation. Under the Decentralized Procurement system (hereinafter referred to as 'DCP'), the State Government through its agencies procure, store and distribute food grains within the State. Expenditure incurred by the State is reimbursed by Govt. of W.P(C).26941/2021 9 India as per the Central Govt guidelines. Kerala is procuring rice under the decentralized procured system through its nodal agency, ie., the 4th respondent - Kerala State Civil supplies Corporation popularly known as SUPPLYCO.
11. According to the 2nd respondent, Food Corporation of India, the averments of the petitioner in paragraph 6 of the above Writ Petition to the effect that as per the FCI guidelines, the Mill owners have to return 68 Kg is factually incorrect and hence denied. Government of India issues principles/guidelines for paddy procurement under central pool throughout India. As per the cost sheet issued for every procurement season, the out turn ratio (hereinafter referred to as OTR) is 68% as fixed by Govt of India. Guidelines related to OTR are not fixed by FCI as claimed by the petitioner. In Kerala, food grains procured by the State agency are directly distributed to the beneficiaries and no excess stocks are handed over to FCI Kerala Region by Kerala State Government or agencies. Hence, the reimbursement is directly made by the Government of India as per the Government of India guidelines. Central Government issues guidelines fixing out turn ratio for procurement of CMR (FAQ) for the Central Pool and for the DCP W.P(C).26941/2021 10 scheme during the KMS every year. These guidelines are being issued to State Governments by way of letters. As per Letter No.192(28)/2017-FC.A/Cs dated 20th February, 2018 issued to the 3rd respondent, the 1st respondent fixed the out turn ratio as 68% for procurement of CMR (FAQ) for the Central Pool and for the DCP scheme during the KMS 2017-18. As per Letter No.192(36)/2018-FC.A/Cs dated 9th January, 2019 issued to the 3 rd respondent, the 1st respondent fixed the out turn ratio as 68% for procurement of CMR (FAQ) for the Central Pool and for the DCP scheme during the KMS 2018-19. As per Letter No. 192(20)/2019- FC.A/Cs dated 4th April, 2020 issued to the 3rd respondent, the 1st respondent fixed the out turn ratio as 68% for procurement of CMR (FAQ) for the Central Pool and for the DCP scheme during the KMS 2019-20.
12. In reply to the averments of the petitioner in paragraphs 7 & 8 of the above Writ Petition to the effect that based on the report of a subcommittee the Kerala state Government relaxed this guideline without consultation with the Central Government and re-fixed the guideline as 64.5 kg per one quintal, it is submitted that FCI was not part of the subcommittee mentioned W.P(C).26941/2021 11 by the Petitioner to refix OTR already fixed by Govt. of India. FCI had not recommended for reduction in OTR from 68% to 64.5%. In Kerala, food grains are procured by the 4th respondent - SUPPLYCO on behalf of the State Government. The 4 th respondent enters into agreement with millers to procure, mill and store paddy/Rice. Food grains procured by the State agency are directly distributed to the beneficiaries and no excess stocks are handed over to FCI Kerala Region by Kerala State Government or agencies.
13. It is further submitted that every year, Memorandum of Understanding is being entered into between the Govt of Kerala and the Government of India for procurement of Paddy and delivery of Custom Milled Rice during Kharif Marketing Season (hereinafter referred to as 'KMS') and was being communicated to this respondent for necessary action. In paragraph 1 of Ext. R2(d), it is agreed that the stocks of Paddy Rice to be procured/ delivered to the Central Pool shall strictly conform to the uniform specification (FAQ norms), as decided by the Government of India from time to time and at the out-turn ratio declared by the Govt of India from time to time subject to any relaxation approved by Govt. of India. For the Kharif Marketing Season 2019-20, MOU was W.P(C).26941/2021 12 duly signed by the General Manager (Kerala) of this respondent also along with the 1st and 3rd respondents. Paragraph 4 of Ext. R2(e) also reiterates that the stocks of Paddy/Rice to be procured/delivered to the Central Pool shall strictly conform to the uniform specification (FAQ norms), as decided by the Government of India from time to time and at the out-turn ratio declared by the Government of India from time to time subject to any relaxation approved by Government of India. As per yearly M.O.U like Exts R2(d) & R2(e), the 3rd respondent is duty bound to strictly adhere to the out-turn ratio of 68% declared by the Govt of India as per Exts R2(a), R2(b) & R2(c) guidelines, in the absence of any relaxation approved by the Govt. of India.
14. As far as the averments of the petitioner in paragraphs 9 to 12 of the above Writ Petition are concerned, it is submitted that though food grains are procured by SUPPLYCO on behalf of the Kerala Government, monthly joint inspections are being conducted by the Quality Control officials of FCI and SUPPLYCO to ascertain the quality of paddy/rice stored at mill points and if any deviation found is reported to higher ups. Exhibit-P1 G.O. issued by Government of Kerala is not yet issued to FCI and the same was W.P(C).26941/2021 13 seen for the first time from the above Writ Petition.
15. It is further submitted that FCI and State agencies procure food grains under central pool based on the principles/guidelines laid down by Govt. of India. FCI was not part of the committee mentioned by the Petitioner to refix OTR already fixed by Govt of India. FCI in no way has recommended for reduction in OTR from 68% to 64.5%. Fixing of OTR being a policy matter, FCI had never participated with State Government for refixing of the Out turn ratio, as can be seen from the communications dated 20.10.2020 and 11.01.2021 sent from the Regional Office of this respondent at Thiruvananthapuram to the 3rd respondent. By Exts.R2(f) & R2(g), Regional Office of this respondent has made it clear to the 3rd respondent that fixing out- turn ratio, being a policy matter, FCI is not in a position to participate in the trial milling process as fixed by the Government of Kerala.
16. We have heard Smt. Mereena Joseph, learned counsel for the petitioner, Sri. K.R. Renjith, learned Special Government Pleader, Smt. K.R. Krishnakumari, learned Standing Counsel for the Food Corporation of India, Smt. Molly Jacob, learned Standing W.P(C).26941/2021 14 Counsel for Kerala State Civil Supplies Corporation, and perused the pleadings and material on record.
17. Deliberation of the facts made above would make it clear that the State Government is not vested with the power to interfere with the out-turn-ratio (OTR) fixed by the Government of India in terms of the successive guidelines and agreement executed by the Government of India with the State Government and the Nodal agency. Here is a case where the existing out-turn- ratio for the parboiled rice at 68% is reduced by the State Government to 64.5%, as per Exhibit P1 State Government Order, which is extracted above.
18. Taking into account the understanding that is entered into by and between the Central Government and the State Government, and the guidelines issued in the matter of decentralised procurement processing, distribution order in the matter of out- turn-ratio, the State Government is not at liberty to upset the out- turn-ratio fixed by the Central Government. It is an admitted fact that the existing out-turn-ratio is 68% rice for one quintal paddy as per the Central Government norms, which shall be the quantity of paddy that shall be returned to the central pool. W.P(C).26941/2021 15
19. Taking into account the factual and legal circumstances, we are of the considered and undoubted opinion that State Government was not right in unilaterally re-fixing the out-turn- ratio from 68% fixed by the Central Government to 64.5%, and compensate the financial commitment that will result for fixing the out-turn-ratio of one quintal paddy as 64.5% instead of 68% of rice during the process of decentralized procurement, processing and distribution, until the Central Government accept the norms, to the mill owners.
20. We are of the considered opinion that going by the memorandum of understanding executed by and between the State and the Central Government, it can be seen that if any State Government wants to refix the out-turn-ratio, the State has to approach the Central Government and only on orders of the Central Government, the out-turn-ratio can be re- fixed.
21. In our considered view, the State Government has not secured any variation orders from the Central Government in order to revise the out-turn-ratio from 68% to 64.5%. Therefore, interference is required to Exhibit-P1 order passed by the State W.P(C).26941/2021 16 Government dated 18.6.2018 and accordingly we quash the same to the extent it varies out-turn-ratio from 68% to 64.5% per one quintal of paddy.
Writ petition is allowed to the above extent.
Sd/-
S. Manikumar, Chief Justice Sd/-
Shaji P. Chaly, Judge sou.
W.P(C).26941/2021 17 APPENDIX OF WP(C) 26941/2021 PETITIONER'S EXHIBITS Exhibit P1 TRUE COPY OF THE ORDER ISSUED BY THE GOVERNMENT SECRETARY TO THE GOVERNOR DATED 18.8.2018.
Exhibit P1(A) ENGLISH TRANSLATED COPY OF EXHIBIT P1. RESPONDENT'S EXHIBITS Exhibit R2(a) TRUE COPY OF LETTER NO.192(28)2017-
FC.A/CS DATED 20TH FEBRUARY, 2018 ISSUED BY THE 1ST RESPONDENT TO THE 3RD RESPONDENT FIXING THE OUT TURN RATIO AS 68% FOR PROCUREMENT OF CMR(FAQ) FOR THE CENTRAL POOL AND FOR THE DCP SCHEME DURING THE KMS 2017-18.
Exhibit R2(b) TRUE COPY OF LETTER NO.192(36)2018-
FC.A/CS DATED 9TH JANUARY, 2019 ISSUED BY THE 1ST RESPONDENT TO THE 3RD RESPONDENT FIXING THE OUT TURN RATIO AS 68% FOR PROCUREMENT OF CMR(FAQ) FOR THE CENTRAL POOL AND FOR THE DCP SCHEME DURING THE KMS 2018-19.
Exhibit R2(c) TRUE COPY OF LETTER NO.192(20)2019-
FC.A/CS DATED 4TH APRIL, 2020 ISSUED BY THE 1ST RESPONDENT TO THE 3RD RESPONDENT FIXING THE OUT TURN RATIO AS 68% FOR PROCUREMENT OF CMR(FAQ) FOR THE CENTRAL POOL AND FOR THE DCP SCHEME DURING THE KMS 2019-20.
Exhibit R2(d) TRUE COPY OF LETTER NO.3(8)2015-Py.I DATED 29TH OCTOBER, 2015 ISSUED BY THE 1ST RESPONDENT ALONG WITH MEMORANDUM OF UNDERSTANDING ENTERED INTO BETWEEN GOVT. OF KERALA AND THE CENTRAL GOVERNMENT FOR DECENTRALISED PROCUREMENT OF PADDY/RICE IN KMS 2015-
16 ONWARDS.
W.P(C).26941/2021 18 Exhibit R2(e) TRUE COPY OF THE MEMORANDUM OF UNDERSTANDING ENTERED INTO BETWEEN GOVT. OF KERALA AND THE CENTRAL GOVERNMENT AND THE GENERAL MANAGER (KERALA) OF THIS RESPONDENT FOR DECENTRALISED PROCUREMENT OF PADDY/RICE IN KMS 2019-20 ONWARDS.
Exhibit R2(f) TRUE COPY OF THE LETTER NO.QC/2/TRIAL MILLING/2015 DATED 20/10/2020 ISSUED FROM THE REGIONAL OFFICE OF THIS RESPONDENT AT KERALA TO THE 3RD RESPONDENT.
Exhibit R2(g) TRUE COPY OF THE LETTER NO.QC/2/TRIAL MILLING/2015 DATED 11/01/2021 ISSUED FROM THE REGIONAL OFFICE OF THIS RESPONDENT AT KERALA TO THE 3RD RESPONDENT.