[Cites 18, Cited by 0]
Kerala High Court
South Indian Green Cardamom Company ... vs M/S. Spices Board Of India on 13 February, 2026
Author: N.Nagaresh
Bench: N.Nagaresh
2026:KER:12494
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
FRIDAY, THE 13TH DAY OF FEBRUARY 2026 / 24TH MAGHA, 1947
WP(C) NO. 10104 OF 2024
PETITIONERS:
1 M/S. SPICEMORE TRADING COMPANY
REPRESENTED BY ITS MANAGING PARTNER,
JOHNY VATTATHARA JOSEPH, AGED 57 YEARS,
VATTATHARA HOUSE, KUMILY, IDUKKI DISTRICT,
KERALA, PIN - 685509.
2 M/S.GREEN HOME CARDAMON MARKETING INDIA PVT.LTD.
REPRESENTED BY ITS MANAGER, VARKEY VARGHESE,
AGED 68 YEARS, S/O. VARKEY, CHAMATHARAYIL HOUSE,
KATTAPPANA P.0, IDUKKI DISTRICT, PIN-685515.
[CORRECTED] *
* [NAME OF 2ND PETITIONER IS CORRECTED AS
"M/S.GREENHOUSE CARDAMOM MARKETING INDIA
PVT.LTD.' INSTEAD OF 'M/S.GREEN HOME CARDAMOM
MARKETING INDIA PVT.LTD.' AS PER ORDER DATED
11.11.2024 IN IA NO.1/2024 IN WPC 10104/2024]
3 M/S. SUGANDHAGIRI SPICES PROMOTERS AND TRADERS
PVT. LTD., BUILDING NO. 986, KALKUMDAL VILLAGE,
NEDUMKANDOM P O, IDUKKI,
REPRESENTED ITS
MANAGING DIRECTOR, GIGI SKARIA,
AGED 49 YEARS, S/O. SKARIA, PIN - 685553.
W.P.(C)No.10104 of 2024
and connected cases
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BY ADVS.
SHRI.P.CHANDRASEKHAR
SHRI.BIJU HARIHARAN
SHRI. ANOOP KRISHNA
SHRI.C.RAMAN
SRI.ANAND SANKAR
SMT.REGIMOL M.K.
SMT.PRATHEEKSHA RAJ
SMT.JENNY THANKAM
RESPONDENTS:
1 M/S. SPICES BOARD OF INDIA
SUGANDABHAVAN, NH BYPASS, PALARIVATTOM,
ERNAKULAM, REPRESENTED BY ITS SECRETARY.,
PIN - 682025.
2 THE SECRETARY
M/S. SPICE BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, ERNAKULAM,
PIN - 682025.
3 THE DIRECTOR (MARKETING),
M/S. SPICE BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, ERNAKULAM,
PIN - 682025.
*ADDL.4 V.P. RAJENDRAN,
AGED 60 YEARS, S/O. PRABHAKARAN NAIR,
VILLOONICKAL HOUSE, CHEMANNAR P.O.,
IDUKKI - 685554.
[ADDITIONAL 4TH RESPONDENT IS IMPLEADED AS
PER ORDER DATED 19.08.2024 IN IA NO.2/2024]
BY ADVS.
SRI.ANTONY MUKKATH
SRI.C.HARIKUMAR
SMT.SANDRA SUNNY
W.P.(C)No.10104 of 2024
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SRI.ARUN KUMAR M.A
SHRI. VIMAL DEV P.V.
SMT.FARAH JYOTHI PRADEEP
SRI.RAJU M.C.
SRI.ANTO VINU YESUDASAN
SRI.S.SANAL KUMAR (SR.)
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY
HEARD ON 09.02.2026, ALONG WITH WP(C).35130/2025 AND
CONNECTED CASES, THE COURT ON 13.02.2026 DELIVERED THE
FOLLOWING:
W.P.(C)No.10104 of 2024
and connected cases
:4:
2026:KER:12494
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
FRIDAY, THE 13TH DAY OF FEBRUARY 2026 / 24TH MAGHA, 1947
WP(C) NO. 14901 OF 2024
PETITIONERS:
1 SOUTH INDIAN GREEN CARDAMOM COMPANY LIMITED
III/505A, 505B, KUMILY-MUNNAR ROAD,
PAMPUMPARA, IDUKKI, KERALA,
REPRESENTED BY ITS MANAGING DIRECTOR
MR. S. JEEVANANDAN, PIN - 685551.
2 SOUTH INDIAN GREEN CARDAMOM ONLINE AUCTION
PRIVATE LIMITED, III/505C, 505D,
KUMILY-KATTAPPANA ROAD, PAMPUMPARA,
IDUKKI, KERALA, REPRESENTED BY ITS
MANAGING DIRECTOR MR. G. VINAYAGAMOORTHY,
PIN - 685551.
BY ADVS.
SHRI.KURIAN ANTONY MATHEW
SRI.ARUN THOMAS
SMT.KARTHIKA MARIA
SMT.VEENA RAVEENDRAN
SRI.ANIL SEBASTIAN PULICKEL
SHRI.SHINTO MATHEW ABRAHAM
SHRI.MATHEW NEVIN THOMAS
SMT.LEAH RACHEL NINAN
SHRI.JOE S. ADHIKARAM
W.P.(C)No.10104 of 2024
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RESPONDENTS:
1 M/S. SPICES BOARD OF INDIA
SUGANDABHAVAN, NH BYPASS, PALARIVATTOM,
ERNAKULAM, REPRESENTED BY ITS SECRETARY,
PIN - 682025.
2 THE SECRETARY
M/S. SPICES BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, PIN - 682025.
3 THE DIRECTOR (MARKETING)
M/S. SPICES BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, PIN - 682025.
BY ADV. SRI.ANTONY MUKKATH, STANDING COUNSEL
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY
HEARD ON 09.02.2026, ALONG WITH WP(C).35130/2025 AND
CONNECTED CASES, THE COURT ON 13.02.2026 DELIVERED THE
FOLLOWING:
W.P.(C)No.10104 of 2024
and connected cases
:6:
2026:KER:12494
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
FRIDAY, THE 13TH DAY OF FEBRUARY 2026 / 24TH MAGHA, 1947
WP(C) NO. 15286 OF 2024
PETITIONER:
M/S MAS ENTERPRISES LIMITED
REPRESENTED BY ITS EXECUTIVE DIRECTOR,
ANJO T JOSE, S/O T.T JOSE, AGED 45 YEARS,
KUMILY-MUNNAR ROAD, VANDANMETTU,
IDUKKI, PIN - 685551.
BY ADVS.
SRI.MATHEW JOHN (K)
SRI.ABY J AUGUSTINE
RESPONDENTS:
1 M/S. SPICES BOARD OF INDIA
SUGANDABHAVAN, NH BYPASS, PALARIVATTOM,
ERNAKULAM, REPRESENTED BY ITS SECRETARY,
PIN - 682025.
2 THE SECRETARY,
M/S. SPICES BOARD OF INDIA,
SUGANDABHAVAN, NH BYPASS,
W.P.(C)No.10104 of 2024
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PALARIVATTOM,
ERNAKULAM, PIN - 682025.
3 THE DIRECTOR (MARKETING),
M/S. SPICES BOARD OF INDIA,
SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM,
ERNAKULAM,
PIN - 682025.
BY ADV SRI.ANTONY MUKKATH, STANDING COUNSEL
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY
HEARD ON 09.02.2026, ALONG WITH WP(C).35130/2025 AND
CONNECTED CASES, THE COURT ON 13.02.2026 DELIVERED THE
FOLLOWING:
W.P.(C)No.10104 of 2024
and connected cases
:8:
2026:KER:12494
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
FRIDAY, THE 13TH DAY OF FEBRUARY 2026 / 24TH MAGHA, 1947
WP(C) NO. 15997 OF 2024
PETITIONER:
M/S CARDAMOM GROWERSFOREVER PRIVATE LTD
D NO.17A, WARD NO.33 NEW COLONY 2ND STREET,
BODINAYAKANUR, THENI DISTRICT TAMILNADU
REPRESENTED BY ITS MANAGING DIRECTOR,
M ARUMUGAM, AGED 66 YEARS
S/O. A MARUTHAMUTHU, PIN - 625513.
BY ADVS.
SHRI.P.CHANDRASEKHAR
SHRI.C.RAMAN
SHRI. ANOOP KRISHNA
SRI.ANAND SANKAR
SMT.REGIMOL M.K.
SMT.PRATHEEKSHA RAJ
SHRI.BIJU HARIHARAN
SMT.JENNY THANKAM
RESPONDENTS:
1 M/S. SPICES BOARD OF INDIA
SUGANDABHAVAN, NIT BYPASS, PALARIVATTOM,
ERNAKULAM REPRESENTED BY ITS SECRETARY,
PIN - 682025.
W.P.(C)No.10104 of 2024
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2 THE SECRETARY
M/S. SPICES BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, ERNAKULAM,
PIN - 682025.
3 THE DIRECTOR (MARKETING)
M/S. SPICES BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, ERNAKULAM,
PIN - 682025.
BY ADV SRI.ANTONY MUKKATH, STANDING COUNSEL
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY
HEARD ON 09.02.2026, ALONG WITH WP(C).35130/2025 AND
CONNECTED CASES, THE COURT ON 13.02.2026 DELIVERED THE
FOLLOWING:
W.P.(C)No.10104 of 2024
and connected cases
:10:
2026:KER:12494
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
FRIDAY, THE 13TH DAY OF FEBRUARY 2026 / 24TH MAGHA, 1947
WP(C) NO. 35130 OF 2025
PETITIONER:
SOUTH INDIAN GREEN CARDAMOM COMPANY LIMITED
III/505A, 505B, KUMILYMUNNAR ROAD,
PAMPUMPARA, IDUKKI, KERALA, REPRESENTED BY
ITS MANAGING DIRECTOR MR. S. JEEVANANDAN,,
PIN - 685551.
BY ADVS.
SHRI.SHINTO MATHEW ABRAHAM
SRI.ARUN THOMAS
SMT.VEENA RAVEENDRAN
SMT.KARTHIKA MARIA
SRI.ANIL SEBASTIAN PULICKEL
SMT.LEAH RACHEL NINAN
SHRI.MATHEW NEVIN THOMAS
SHRI.KARTHIK RAJAGOPAL
SHRI.KURIAN ANTONY MATHEW
SMT.APARNNA S.
SHRI.ARUN JOSEPH MATHEW
SHRI.ADEEN NAZAR
SHRI.NOEL NINAN NINAN
SHRI.SANTHOSH MATHEW (SR.)
RESPONDENTS:
1 M/S. SPICES BOARD OF INDIA
SUGANDABHAVAN, NH BYPASS, PALARIVATTOM,
ERNAKULAM, REPRESENTED BY ITS SECRETARY,
PIN - 682025.
W.P.(C)No.10104 of 2024
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2 THE SECRETARY
M/S. SPICES BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, PIN - 682025.
3 THE DIRECTOR (MARKETING)
M/S. SPICES BOARD OF INDIA, SUGANDABHAVAN,
NH BYPASS, PALARIVATTOM, PIN - 682025.
BY ADVS.
SRI.ANTONY MUKKATH
SRI.REGI MATHEW
SRI.JOSEPH M.L.
SRI.ARUN KUMAR V.
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 09.02.2026, ALONG WITH WP(C).10104/2024,
14901/2024 AND CONNECTED CASES, THE COURT ON
13.02.2026 DELIVERED THE FOLLOWING:
W.P.(C)No.10104 of 2024
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CR
JUDGMENT
Dated this the 13th day of February, 2026
[W.P.(C) Nos.10104, 14901, 15286,
15997 of 2024 and 35130 of 2025]
The petitioners, who are e-auctioneering licensees
under the Spices Board of India, are before this Court
aggrieved by the enhancement effected by the Spices
Board in the Bank Guarantee / Security Deposit to be
provided by them.
2. The petitioners state that they are carrying
on the business in cardamom as auctioneers for a
considerably long period. The licence issued to them by the
Spices Board is being renewed year after year without any
break as at present. As per Rule 10 of the Cardamom
(Licensing and Marketing) Rules, 1987, the petitioners are
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to provide a Security Deposit in the form of a Bank
Guarantee (equivalent to the average auction sale value of
cardamom in one auction during the immediate preceding
block period of three years) for the block period for which
the applicant desires to obtain the auctioneer licence.
3. Even though the statutory rule is so, the
respondents issued Ext.P12 order dated 21.02.2024,
wherein it is stated that the Spices Board has decided to
introduce progressive changes in the existing e-auction
system. A Committee was appointed to study the
regulations of SEBI and the settlement systems of
Commodity Exchanges to safeguard the interest of the
stakeholders / farmers from the risk of non-payment, the
alternative to Bank Guarantee and submit
recommendations to the Board. The Board decided that till
the time the recommendations were approved for
implementation and modifications are effected in the
and connected cases
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existing software, as an interim measure, the Board
approved to collect from the auctioneers, the Bank
Guarantee amounts as follows:-
(i) Fixation of BG amount, in case of
renewal applicants, equivalent to the average
auction sale value in one auction, of that
auctioneer during the preceding block period. For
new applicants, the BG amount should be
equivalent to the average auction sale value in one
auction, of all auctioneers during the preceding
block period.
(ii) Additionally, the Board should introduce
a system whereby an auctioneer would not be
allowed to pool / trade beyond a fixed upper limit in
an auction (for example, equivalent to BG amount
or not more than 125% of the BG amount), as
might be fixed by the Board. The Secretary,
Spices Board should reassess and modify the BG
amount as per requirement to ensure minimising
risk and ensuring smooth functioning of the
e-auction system.
4. The petitioners submit that on the basis of
the said decision, the Spices Board is pressurising the
petitioners to enhance the Bank Guarantee provided by the
petitioners at disproportionate levels. Such action is highly
illegal and arbitrary, contend the petitioners.
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5. The petitioners would submit that the
Central Government has framed Cardamom (Licensing
and Marketing) Rules, 1987 ('the CLMR, 1987', for short) in
exercise of the powers conferred by Section 18 of the
Spices Board Act, 1986. Rule 10 of the CLMR, 1987
provides that for e-auctions, the applicant shall provide a
Security Deposit in the form of Bank Guarantee (equivalent
to the average auction sale value of cardamon in one
auction during the immediate preceding block period of
three years) for the block period for which the applicant
desires to obtain the auctioneer licence.
6. Since the Central Government, who is a
superior authority and who is the rule making authority has
specifically provided for the quantum of Bank Guarantee
required for issuance of e-auction licence, the Spices
Board cannot issue orders enhancing the Bank Guarantee
required for issuance / renewal of e-auction licence. The
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coercive proceedings against the petitioners are therefore
illegal and unsustainable, contend the petitioners.
7. The petitioners state that they have taken
huge loan to invest in their cardamom auctioneering
business. The petitioners applied for licence on the belief
that the Spices Board will adhere to the conditions in the
Rules and will insist only Bank Guarantee as per the Rules.
The present action of the Spices Board in substantially
enhancing the Bank Guarantee will result in huge loss to
the petitioners.
8. Standing Counsel entered appearance on
behalf of the Spices Board and resisted the writ petition. On
behalf of the respondents, it is submitted that the Spices
Board in its 93rd Board meeting held on 20.10.2023,
approved the issuance of cardamom licence for the block
period 2023-2026 to the eligible applicants. The Board
suggested to explore the possibility of differentiating Bank
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Guarantee amount for different category of participants
within a month. For the said purpose, a Committee was
constituted.
9. After detailed deliberations, the
Committee recommended the following for fixation of Bank
Guarantee for eligible applicants for the new block period
2023-2026 in tune with the CLMR, 1987:-
(a) Fixation of a variable Security Deposit
amount in the form of Bank Guarantee to the
renewal applicants as per their average auction
sale value of cardamom in one auction during
the previous block period for the renewal
applicants.
(b) In case of fresh applicants, the average
sale value of cardamom in an auction conducted
by all auctioneers in previous block period (2020-
2023) may be fixed initially and then BG amount
may be revised after six months based on review
of the average sale value of cardamom in an
auction conducted by fresh applicants.
10. The renewal applicants, including the
petitioners, submitted Bank Guarantee ranging from 2.60
Crores to 7.96 Crores as per the average auction sale
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value of cardamom in one auction during the immediate
preceding block period of three years and fresh applicants
submitted Bank Guarantee for ₹5.89 Crores as per the
average sale value of cardamom in an auction conducted
by all auctioneers of previous block period.
11. Standing Counsel representing the Spices
Board submitted that the administration of Spices Board is
governed by the Spices Board Act, 1986. The functions of
the Board as laid down in Section 7 of the Act, 1986
include ensuring remunerative returns to growers of
cardamom, regulating the sale of cardamom and
stabilisation of prices of cardamom. The Spices Board,
therefore, is statutorily bound to regulate the sale of
cardamom and stabilise the prices of cardamom.
Therefore, in spite of Section 10, the Spices Board has a
right to regulate the sale of cardamom and for that purpose,
enhance the Bank Guarantee amounts, in order to protect
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the interest of the cardamom farmers.
12. Standing Counsel further pointed out that
the Spices Board has the right to reassess and modify the
Bank Guarantee amount as and when deemed fit. As per
the licence condition, the auctioneer shall also adhere to
the instructions of the Board issued from time to time for
smooth and efficient conduct of cardamom auction. Ext.P3
instructions issued by the Spices Board also insist that the
auctioneer shall adhere to the instructions of the Board
issued from time to time for smooth and efficient conduct of
cardamom auction.
13. The respondents relied on Ext.P8 notice
inviting applications for award of auctioneer licence dated
16.12.2020. Clause 14 of the said notice provided that the
auctioneer shall pay the growers, whose cardamom is
pooled, the applicable sale value of the cardamom sold in
an auction within ten working days from the date of auction.
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If the auctioneer defaults to make payment as per the
terms and conditions of the licence, the Board will be
entitled to invoke the Bank Guarantee and use the
proceeds for arranging settlement of amount due to
growers and to initiate steps for suspension and/or
cancellation of the licence.
14. In the 93rd Board meeting of the Spices
Board held on 20.10.2023, with regard to enhancement of
the Bank Guarantee to be submitted by the applicants of
the auctioneer licence (e-auction), it was decided that the
Bank Guarantee cannot be discontinued as the Board
cannot take the entire risk in case of payment defaults
under its auction system. It was suggested to explore the
possibility of differentiating Bank Guarantee amount for
different categories of participants, which should be
examined.
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15. Standing Counsel for the respondents
specifically relied on Ext.P17 letter issued to the petitioner
in W.P.(C) No.10104 of 2024, wherein the Board has made
it clear that the Board has the right to reassess and modify
the Bank Guarantee amount as and when deemed fit. All
the petitioners have accepted such conditions of licence.
They have been intimated about the enhancement of Bank
Guarantee also. The challenge against the action taken by
the respondents is therefore without any force or merit and
it is liable to be dismissed, contended the Standing
Counsel appearing for the Spices Board.
16. Standing Counsel relied on a decision of
the Madurai Bench of the Hon'ble Madras High Court
W.P(MD) No.6717 of 2024, wherein the issue of
enhancement of Bank Guarantee was considered. The
Madurai Bench of the Hon'ble Madras High Court has
repelled the challenge to enhancement of Bank Guarantee
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introduced by the Spices Board. The issue involved in this
case is squarely covered by the decision of the Madurai
Bench of the Hon'ble Madras High Court, contended the
Standing Counsel.
17. I have heard the learned Counsel for the
petitioners and the learned Standing Counsel appearing for
the Spices Board. I have also heard the learned counsel
who appeared for the Cardamom Growers Association.
18. The petitioners are aggrieved by the
enhancement of Bank Guarantee / Security Deposit
effected by the Spices Board and consequential demand
for the enhanced Bank Guarantee / Security Deposit from
the e-auctioneering agencies. The petitioners would argue
that in view of Rule 10 of the CLMR, 1987, only the
Government of India can effect enhancement of Bank
Guarantee / Security Deposit, whereas the Spices Board of
India would insist that in the light of Section 7 and Section 8
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of the Spices Board Act, 1986, the Board has a right to
regulate the sale of cardamom and stabilisation of prices of
cardamom and consequently, the Board has a right to
enhance the Bank Guarantee / Security Deposit.
19. The Spices Board Act, 1986 has been
enacted for the constitution of a Board for the development
of export of spices and for the control of cardamom industry
including the control of cultivation of cardamom. Section
38 of the Act, 1986 provides that the Central Government
may, by notification in the Official Gazette, make rules to
carry out the purposes of the Act.
20. Section 38 of the Spices Board Act, 1986
reads as follows:
38. Power to make rules--
(1) The Central Government may, by
notification in the Official Gazette, make rules to
carry out the purposes of this Act.
(2) Without prejudice to the generality of
the foregoing power such rules may provide for
all or any of the following matters, namely:--
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(a) the number of members of the
Board under sub-section (3) of section 3;
(b) the term of office and other
conditions of service of the members of the
Board under sub-section (5) of section 3;
(c) the powers and duties of the
Chairman under sub-section (6) of section 3;
(d) the powers and functions of the
Vice-Chairman under sub-section (7) of
section 3;
(e) the constitution of committees
under section 5;
(f) the terms and conditions for giving
licences to manufacturers of spices for export
under clause (viii) of sub-section (1) of
section 7;
(g) the form and manner in which and
the time at which the registered owner may
furnish returns to the Board under section 10;
(h) the form of the application and the
fees under sub-section (1) of section 12;
(i) the period of limitation for appeal
under sub-section (1) of section 14;
(j) the form of appeal and the fees
payable under sub-section (3) of section 14;
(k) the procedure for disposal of
appeal under sub-section (4) of section 14;
(l) the form in which, and the time at
which, the Board shall prepare its budget under
section 22 and its annual report under section
23;
(m) the manner in which the accounts
of the Board shall be maintained and audited
and the date before which the audited copy of
the accounts may be furnished to the Central
Government under section 24;
(ma) the manner of holding inquiry
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and imposing penalty under sub-section (1) of
section 30A;
(mb) the form and manner of
preferring appeal under sub-section (2) of
section 30A;
(n) the conditions and the restrictions
with respect to the exercise of the power to
enter under section 37;
(o) any other matter which is to be, or
may be, prescribed or in respect of which
provision is to be, or may be, made by rules.
21. In exercise of the powers conferred by
Section 38 of the Act, 1986, the Central Government has
framed the CLMR, 1987. Rule 3 of the Rules, 1987
provides that no person shall carry on business as
auctioneer or dealer of cardamom except under and in
accordance with the terms and conditions of a licence
issued under the Rules and such other instructions as may
be issued from time to time by the Board for the
development of cardamom industry.
22. Rule 10 of the CLMR, 1987 which
provides for the terms and conditions for issue or renewal
and connected cases
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of licences. Rule 10(1)(a) of the CLMR, 1987 reads as
follows:-
10. Terms and conditions for issue or
renewal of licences-
(1) The terms and conditions for issue or
renewal of auctioneer licence shall be as
under :-
(a) for e-auction, the applicant shall
provide a security deposit in the form of a Bank
Guarantee (equivalent to the average auction
sale value of cardamom in one auction during
the immediate preceding block period of three
years) for the block period for which the
applicant desires to obtain the auctioneer
licence.
23. It is therefore clear that the Central
Government under Rule 10(1)(a) has statutorily prescribed
the Security Deposit to be provided by auctioneers fixing
the same as Bank Guarantee (equivalent to the average
auction sale value of cardamom in one auction during the
immediate preceding block period of three years) for the
block period for which the applicant desires to obtain the
auctioneer licence.
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24. The argument of the respondents is that
notwithstanding Rule 10 of the Rules, 1987, the petitioners
are bound by the conditions of licence issued to them and
the licence conditions stipulate that the auctioneer shall
adhere to the instructions of the Board issued for smooth
and efficient conduct of cardamom auction. In view of the
said conditions, the petitioners are bound to honour the
demand made by the Spices Board for enhanced Bank
Guarantee.
25. Ext.P8 notice inviting application for award
of auctioneer licence, in its general terms and conditions
provides that the auctioneer shall pay the growers whose
cardamom is pooled, the applicable sale value of the
cardamom sold in auction within ten working days from the
date of auction. If the auctioneer defaults to make payment
as per the terms and conditions of the licence, the Board
will be entitled to invoke the Bank Guarantee and use the
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proceeds for arranging settlement of amount due to
growers and to initiate steps for suspension and/or
cancellation of the licence. It is the contention of the
Spices Board that enhanced Bank Guarantee demanded
by the Spices Board is in order to protect the interest of the
cardamom growers. Therefore, the petitioners cannot
challenge the enhancement.
26. The pleadings and arguments raised at
the Bar do not indicate any instance of non-payment of sale
value of the cardamom sold in auction to the cardamom
growers, though the Standing Counsel for the Spices Board
would assert that there were instances of delay on the part
of certain auctioneers in making payment.
27. There is no doubt that interest of the
cardamom growers is to be protected and payment due to
the farmers are to be ensured. But, such protective
mechanism can be enforced by the Spices Board only in
and connected cases
2026:KER:12494
accordance with the law and the rules prescribed for the
same and such mechanism should be within the framework
of law. It is true that as per Section 7 of the Spices Board
Act, 1986, the Board has the power to ensure remunerative
returns to growers of cardamom and to regulate the sale of
cardamom and stabilisation of prices of cardamom. But,
such power can be exercised only adhering to the
provisions of the Act and the Rules.
28. Rule 3 of the CLMR, 1987 provides that
no person shall carry on business as auctioneer or dealer
of cardamom except and in accordance with the terms and
conditions of a licence issued under the rules and such
other instructions as may be issued by the Board from time
to time. The question arising here is whether the Board
can prescribe rules or issue any instructions contrary to the
provisions contained in the CLMR, 1987 itself.
and connected cases
2026:KER:12494
29. Rule 10 of the CLMR, 1987 specifically
provides that for e-auction, the applicant shall provide a
Security Deposit in the form of a guarantee, (equivalent to
the average auction sale value of cardamom in one auction
during the immediate preceding block period of three
years) for the block period for which the applicant desires
to obtain the auctioneer licence. When the Central
Government has statutorily incorporated in the Rules the
quantum of Bank Guarantee to be provided by the
auctioneers, the Board will not be justified in enhancing the
same without amending the Rules.
30. It is evident that the present quantum of
Security Deposit in the form of Bank Guarantee is revised
by the Central Government itself by effecting an
amendment to the Rule inserted as per notification GSR
816(E) dated 18.11.2014. It is true that under Section
39(1) of the Act, the Board may, with the previous approval
and connected cases
2026:KER:12494
of the Central Government, by notification in the Official
Gazette, make regulations consistent with the Act and the
Rules generally to carry out the purposes of the Act. From
Section 39(1), it is clear that such regulations issued by the
Board shall be consistent with the Act and the Rules. The
enhancement of Security Deposit / Bank Guarantee now
being effected by the Spices Board, is inconsistent with
Rule 10 of the CLMR, 1987 framed by the Central
Government. Due to the afore reasons, I disagree with the
judgment of the Madurai Bench of the Hon'ble Madras High
Court in W.P.(MD) No.6717/2024.
31. In the facts and circumstances of the
case, the petitioners are entitled to succeed. The
impugned notices/letters issued by the Spices Board of
India to the petitioners seeking enhanced Security Deposit /
Bank Guarantee are set aside. The petitioners shall be
permitted to conduct e-auction / sale of cardamom without
and connected cases
2026:KER:12494
insisting for more Bank Guarantee as long as the
Cardamom (Licensing and Marketing) Rules, 1987 are not
amended accordingly.
The writ petitions are disposed of as
above.
Sd/-
N. NAGARESH
JUDGE
ams / aks
and connected cases
2026:KER:12494
APPENDIX OF WP(C) NO. 10104 OF 2024
PETITIONERS' EXHIBITS
Exhibit P1 TRUE COPY OF THE LICENSE ISSUED TO
THE 1ST PETITIONER BY THE 1ST
RESPONDENT DATED 15.06.2021 FOR THE
PERIOD UP TO 31.08.2023
Exhibit P2 TRUE COPY OF THE LICENSE ISSUED TO
THE 1ST PETITIONER AUTHORIZING THEM
TO CARRY ON BUSINESS IN CARDAMOM UP
TO 31.08.2026 AS AUCTIONEER
Exhibit P3 TRUE COPY OF THE LICENSE ISSUED TO
THE 2ND PETITIONER BY THE 1ST
RESPONDENT DATED 15.06.2021 FOR THE
PERIOD UP TO 31.08.2023
Exhibit P4 TRUE COPY OF THE LICENSE ISSUED TO
THE 2ND PETITIONER BY THE 1ST
RESPONDENT DATED 21.02.2024 TO DO
BUSINESS IN CARDAMOM AS AUCTIONEER
VALID UP TO 31.08.2023
Exhibit P5 TRUE COPY OF THE EXTRACT OF THE
MINUTES OF THE BOARD OF DIRECTORS OF
THE 2ND PETITIONER AUTHORIZING
VARKEY VARGHESE, MANAGER TO
REPRESENT THE 2ND PETITIONER
Exhibit P6 A TRUE COPY OF THE LICENSE ISSUED TO
THE 3RD PETITIONER BY THE 1ST
RESPONDENT DATED 15.06.2021 FOR THE
PERIOD UP TO 31.08.2023
Exhibit P7 TRUE COPY OF THE LICENSE ISSUED TO
THE 3RD PETITIONER BY THE 1ST
RESPONDENT DATED 21.02.2024 FOR THE
PERIOD UP TO 31.08.2016
Exhibit P8 TRUE COPY OF THE NOTICE DATED
16.12.2020 ISSUED BY THE 1ST
RESPONDENT
Exhibit P9 TRUE COPY OF THE BANK GUARANTEE FOR
RS.5,85,00,000/- DATED 30.12.2023
SUBMITTED BY THE 1ST PETITIONER TO
and connected cases
2026:KER:12494
THE 1ST RESPONDENT
Exhibit P10 TRUE COPY OF THE BANK GUARANTEE
DATED 21.12.2023 FOR
RS.3,65,00,000/- IN FAVOUR OF THE
1ST RESPONDENT
Exhibit P11 A TRUE COPY OF THE LETTER DATED
20.12.2023 OF FEDERAL BANK,
NEDUMKANDOM BRANCH TO THE 1ST
RESPONDENT
Exhibit P12 TRUE COPY OF THE ORDER DATED
21.02.2024 OF THE 2ND RESPONDENT
Exhibit P13 A TRUE COPY OF THE MINUTES OF 93RD
BOARD MEETING OF THE 1ST RESPONDENT
DATED 20.10.2023
Exhibit P14 TRUE COPY OF THE MINUTES OF 90TH
BOARD MEETING DATED 07.05.2021 OF
THE 1ST RESPONDENT
Exhibit P15 A TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05.03.2024
ISSUED BY THE 3RD RESPONDENT TO THE
1ST PETITIONER
Exhibit P16 A TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05.03.2024
ISSUED BY THE 3RD RESPONDENT TO THE
2ND PETITIONER
Exhibit P17 TRUE COPY OF THE LETTER NO. MKT-AUC-
NSWS/02/2022 DATED 05.12.2023 ISSUED
BY THE 3RD RESPONDENT TO THE 1ST
PETITIONER
Exhibit P18 TRUE COPY OF THE LETTER NO. MKT-
AUC/NSWS/02/2022 DATED 21.02.2024
ISSUED BY THE 3RD RESPONDENT TO THE
3RD PETITIONER
Exhibit P19 A TRUE COPY OF THE CARDAMOM
(LICENSING AND MARKETING) RULES 1987
and connected cases
2026:KER:12494
APPENDIX OF WP(C) NO. 14901 OF 2024
PETITIONERS' EXHIBITS
Exhibit P1 TRUE COPY OF THE LETTER NO. MKT-
AUC/NSWS/02/2022 DATED 15.12.2023
SENT BY THE 1ST RESPONDENT TO THE
1ST PETITIONER DIRECTING THEM TO
FURNISH RS. 7.96 CRORES AS BANK
GUARANTEE FOR ISSUANCE OF E-AUCTION
LICENSE.
Exhibit P2 TRUE COPY OF THE LETTER NO. MKT-
AUC/NSWS/02/2022 DATED 15.12.2023
SENT BY THE 1ST RESPONDENT TO THE
2ND PETITIONER DIRECTING THEM TO
FURNISH RS. 5.89 CRORES AS BANK
GUARANTEE FOR ISSUANCE OF E-AUCTION
LICENSE.
Exhibit P3 TRUE COPY OF THE BANK GUARANTEE
BEARING NUMBER 1073LBG142671 DATED
20-12-2023 FOR 7.96 CRORES EXECUTED
IN FAVOUR OF THE 1ST RESPONDENT.
Exhibit P4 TRUE COPY OF THE EMAIL DATED
21.12.2023 SENT TO THE FEDERAL BANK
BY THE 3RD RESPONDENT.
Exhibit P5 TRUE COPY OF THE REPLY DATED
21.12.2023 SENT BY THE FEDERAL BANK
TO 3RD RESPONDENT.
Exhibit P6 TRUE COPY OF THE E-AUCTIONEER
LICENSE BEARING CERTIFICATE NO.
EAUC/CS/S1421/11/2024-25 DATED
21.02.2024 ISSUED TO THE 1ST
PETITIONER BY THE 1ST RESPONDENT.
Exhibit P7 TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05.03.2024
ISSUED TO THE 1ST PETITIONER BY THE
3RD RESPONDENT.
Exhibit P8 TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 16.03.2024
ISSUED BY THE 3RD RESPONDENT TO THE
and connected cases
2026:KER:12494
1ST PETITIONER.
Exhibit P9 TRUE COPY OF THE BANK GUARANTEE
BEARING NUMBER 1073LBG142668 DATED
20.12.2023 FOR RS. 5.89 CRORES
EXECUTED IN FAVOUR OF THE 1ST
RESPONDENT.
Exhibit P10 TRUE COPY OF THE EMAIL DATED
22.12.2023 SENT TO THE FEDERAL BANK
BY THE 3RD RESPONDENT.
Exhibit P11 TRUE COPY OF THE REPLY EMAIL DATED
22.12.2023 SENT BY THE FEDERAL BANK
TO 3RD RESPONDENT.
Exhibit P12 TRUE COPY OF THE E-AUCTIONEER
LICENSE BEARING CERTIFICATE NO.
EAUC/CS/50014/14/2024-25 DATED
21.02.2024 ISSUED TO THE 2ND
PETITIONER BY THE 1ST RESPONDENT.
Exhibit P13 TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05.03.2024
ISSUED TO THE 2ND PETITIONER BY THE
3RD RESPONDENT.
Exhibit P14 TRUE COPY OF THE 90TH BOARD MEETING
OF THE 1ST RESPONDENT HELD ON
07.05.2021.
Exhibit P15 TRUE COPY OF THE INTERIM ORDER DATED
20.03.2024 IN W.P.(C) NO. 10104/2024
Exhibit P16 TRUE COPY OF INTERIM ORDER DATED
03.04.2024 IN W.P.(C) 10104/2024
Exhibit P17 TRUE COPY OF RTI REPLY DATED
03.04.2024 SENT BY THE PUBLIC
INFORMATION OFFICER (CPIO) OF THE
1ST RESPONDENT TO THE ASSOCIATION OF
SPICE FARMERS, ANKKARA
and connected cases
2026:KER:12494
APPENDIX OF WP(C) NO. 15286 OF 2024
PETITIONER'S EXHIBITS
Exhibit P1 TRUE COPY OF THE LICENSE ISSUED BY
THE 1ST RESPONDENT TO THE PETITIONER
DATED 15.06.2021
Exhibit P2 TRUE COPY OF THE LICENSE ISSUED TO
THE PETITIONER TO BE AN AUCTIONEER
DATED 21.02.2024
Exhibit P3 TRUE COPY OF THE NOTICE DATED
16.12.2020 ISSUED BY THE 1ST
RESPONDENT
Exhibit P4 TRUE COPY OF THE BANK GUARANTEE
SUBMITTED BY THE PETITIONER DATED
21.12.2023.
Exhibit P5 TRUE COPY OF THE LETTER ISSUED BY
THE 3RD RESPONDENT DATED 09.04.2024
Exhibit P6 TRUE COPY OF THE ADDITIONAL BANK
GUARANTEE SUBMITTED BY THE
PETITIONER DATED 14.03.2024
Exhibit P7 TRUE COPY OF THE ORDER OF THE 2ND
RESPONDENT DATED 21.02.2024
Exhibit P8 TRUE COPY OF THE MINUTES OF THE 90TH
BOARD MEETING DATED 07.05.2021
Exhibit P9 TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05.03.2024
Exhibit P10 TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 16.03.2024
Exhibit P11 TRUE COPY OF THE INTERIM ORDER DATED
20.03.2024 IN WP(C) 10104/2024
Exhibit P12 TRUE COPY OF THE JUDGMENT IN W.A 192
OF 2024 DATED 04.03.2024
Exhibit P13 TRUE COPY OF THE LETTER DATED
15.12.2023
and connected cases
2026:KER:12494
APPENDIX OF WP(C) NO. 15997 OF 2024
PETITIONER'S EXHIBITS
Exhibit P1 A TRUE COPY OF THE LETTER DATED
04.06.2021 OF THE 3RD RESPONDENT
AWARDING E- AUCTION LICENSE TO THE
PETITIONER FOR THE PERIOD 2020
-2023.
Exhibit P2 A TRUE COPY OF THE LICENSE ISSUED TO
THE 1ST PETITIONER AUTHORIZING THEM
TO CARRY ON BUSINESS IN CARDAMOM UP
TO 31.08.2026 AS AUCTIONEER
Exhibit P3 A TRUE COPY OF THE NOTICE DATED
16.12.2020 ISSUED BY THE 1ST
RESPONDENT
Exhibit P4 A TRUE COPY OF THE LETTER DATED
21.02.2024 OF THE 3RD RESPONDENT TO
THE PETITIONER
Exhibit P5 A TRUE COPY OF THE ORDER DATED
21.02.2024 OF THE 2ND RESPONDENT
Exhibit P6 A TRUE COPY OF THE RELEVANT PAGES OF
THE MINUTES OF 93RD BOARD MEETING OF
THE 1ST RESPONDENT DATED 20.10.2023
Exhibit P7 A TRUE COPY OF THE MINUTES OF 90TH
BOARD MEETING DATED 07.05.2021 OF
THE 1ST RESPONDENT
Exhibit P8 A TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05.03.2024
ISSUED BY THE 3RD RESPONDENT TO THE
1 ST PETITIONER
Exhibit P9 A TRUE COPY OF THE INTERIM ORDER
DATED 20.03 .204 IN WP(C) NO.10104
OF 2024
Exhibit P10 A TRUE COPY OF THE INTERIM ORDER
DATED 03.04.2024 IN IN WP(C)
NO.10104 OF 2024.
Exhibit P11 A TRUE COPY OF THE CARDAMOM
(LICENSING AND MARKETING) RULES 1987
and connected cases
2026:KER:12494
APPENDIX OF WP(C) NO. 35130 OF 2025
PETITIONER'S EXHIBITS
Exhibit P1 A TRUE COPY OF THE LETTER NO. MKT-
AUC/NSWS/02/2022 DATED 15-12-2023
SENT BY THE 1ST RESPONDENT TO THE
PETITIONER DIRECTING TO FURNISH RS.
7.96 CRORES AS BANK GUARANTEE FOR
ISSUANCE OF E-AUCTION LICENSE.
Exhibit P2 A TRUE COPY OF THE BANK GUARANTEE
BEARING NUMBER 1073LBG142671 DATED
20-12-2023 FOR RS.7.96 CRORES
EXECUTED IN FAVOUR OF THE 1ST
RESPONDENT
Exhibit P3 A TRUE COPY OF THE E-AUCTIONEER
LICENSE BEARING CERTIFICATE NO.
EAUC/CS/S1421/11/2024-25 DATED 21-
02-2024 ISSUED TO THE PETITIONER BY
THE 1ST RESPONDENT
Exhibit P4 A TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 05-03-2024
ISSUED TO THE PETITIONER BY THE 3RD
RESPONDENT
Exhibit P5 A TRUE COPY OF THE LETTER NO. MKT-
MISC/0010/2017 DATED 16-03-2024
ISSUED BY THE 3RD RESPONDENT TO THE
PETITIONER.
Exhibit P6 A TRUE COPY OF THE RELEVANT PAGES OF
THE 90TH BOARD MEETING OF THE 1ST
RESPONDENT HELD ON 07-05-2021.
Exhibit P7 A TRUE COPY OF THE RTI REPLY DATED
03-04-2024 ISSUED BY THE 1ST
RESPONDENT .
Exhibit P8 A TRUE COPY OF THE INTERIM ORDER
DATED 09-04-2024, OF THIS HON'BLE
COURT IN W.P.(C) 14901 OF 2024.
Exhibit P9 A TRUE COPY OF THE LATEST INTERIM
ORDER, DATED 06-08-2025, OF THIS
and connected cases
2026:KER:12494
HON'BLE COURT IN W.P.(C) 14901 OF
Exhibit P10 A TRUE COPY OF THE LEASE AGREEMENT
DATED 20-02-2025, FOR THE NEW DEPOT
IN KILAKKUCHETTIPATTI.
Exhibit P11 A TRUE COPY OF THE EMAIL DATED 24-
02-2025 SENT BY THE PETITIONER TO
THE 3RD RESPONDENT.
Exhibit P12 A TRUE COPY OF THE WRITTEN
APPLICATION DATED 24-02-2025,
SUBMITTED BY THE PETITIONER TO THE
3RD RESPONDENT.
Exhibit P13 A TRUE COPY OF THE GST CERTIFICATE
OF THE PETITIONER, DATED 18-03-2025,
REFLECTING THE ADDRESS OF THE
PROPOSED DEPOT.
Exhibit P14 A TRUE COPY OF THE EMAIL SENT BY THE
PETITIONER TO THE RESPONDENT, DATED
01-04-2025.
Exhibit P15 A TRUE COPY OF THE REPLY EMAIL DATED
01-04-2025, SENT BY THE 1ST
RESPONDENT TO THE PETITIONER.
Exhibit P16 A TRUE COPY OF THE TRADING LICENSE
ISSUED TO THE PETITIONER BY THE
KILAKKUCHETTIPATTI VILLAGE
PANCHAYAT, DATED 11-06-2025.
Exhibit P17 A TRUE COPY OF THE BUILDING TAX
RECEIPT FOR FINANCIAL YEAR 2025-
2026, DATED 21-06-2025, ALONG WITH
ITS TRANSLATION
Exhibit P18 A TRUE COPY OF THE EMAIL DATED 21-
06-2025 SENT BY THE PETITIONER TO
THE 3RD RESPONDENT .
Exhibit P19 A TRUE COPY OF THE REMINDER EMAIL
SENT BY THE PETITIONER TO THE 3RD
RESPONDENT, DATED 06-09-2025
Exhibit P20 A TRUE COPY OF THE EMAIL REPLY,
DATED 08-09-2025, SENT BY THE 3RD
RESPONDENT.
Exhibit P21 A TRUE COPY OF THE AMENDMENT OF 2014
and connected cases
2026:KER:12494
AS PUBLISHED IN THE OFFICIAL
GAZETTE.
RESPONDENT'S EXHIBITS
Exhibit R-1(a) A TRUE COPY OF THE LETTER NO. MKT-
AUC/NSWS/02/2022 DATED 21.02.2024
Exhibit R-1(b) A TRUE COPY OF THE MINUTES OF
THE94TH BOARD MEETING HELD ON 30-01-
Exhibit R-1(c) A TRUE COPY OF THE ORDER DATED
21-03-2024 IN W.P.(MD)NO.6717 OF
2024 OF THE MADUARI BENCH OF THE
HONOURABLE HIGH COURT OF MADRAS
Annexure R-1(d) A TRUE COPY OF THE REPORT OF
INSPECTION CONDUCTED BY SPICES BOARD
ON 13.06.2025 AT THE OFFICE OF THE
PETITIONER
Annexure R-1(e) A TRUE COPY OF AUCTION DETAILS OF
THE PETITIONER
