K. Sankar Narayan Subudhi And Another vs State Of Orissa
2025 Latest Caselaw 9449 Ori

Orissa High Court

K. Sankar Narayan Subudhi And Another vs State Of Orissa on 28 October, 2025

        IN THE HIGH COURT OF ORISSA AT CUTTACK

                        CRA No.270 of 1999

(In the matter of an application under Section 374(2) of the Criminal
Procedure Code, 1973)

K. Sankar Narayan Subudhi and another .......             Appellants
                                -Versus-
State of Orissa                .......                   Respondent

For the Appellants : Ms. Shuvra Mohpatra, Amicus Curiae

For the Respondent : Mr. Sarathi Jyoti Mohanty, ASC

CORAM:

THE HONOURABLE SHRI JUSTICE SIBO SANKAR MISHRA

Date of Hearing: 14.10.2025 : Date of Judgment: 28.10.2025

S.S. Mishra, J. The present Criminal Appeal, filed by the appellants

under Section 374(2) of the Code of Criminal Procedure, is directed

against the judgment and order dated 11.10.1999 passed by the learned

1st Additional Sessions Judge, Berhampur, in 2(c)C.C. No.5/93/ T.R. No.

19/96. By the impugned judgment, the learned trial Court convicted the

accused-appellants for contravention of clause 3(2) and 12 of Orissa Pulses, Edible Oil Seeds and Edible Oils Dealers (Licensing) Order,

1977 read with the Notification No. 26011 dated 12.08.1988 which is

punishable under Section 7 of the Essential Commodities Act

(hereinafter EC Act for brevity). The appellants were sentenced to

undergo rigorous imprisonment for one year for the offence and to pay a

fine of Rs.5,000/-, in default, whereof to undergo rigorous imprisonment

for one month.

2. The present appeal is pending since 22.11.1999. When the matter

was taken up for hearing on 01.07.2025 and 03.07.2025, none has

appeared on behalf of the appellants. Therefore, this Court requested Ms.

Shuvra Mohapatra, learned counsel, who is present in Court to assist the

Court as Amicus Curiae. She has readily accepted the same and after

obtaining entire record, assisted the Court very effectively. This Court

records appreciation for the meaningful assistance rendered by Ms.

Mohapatra.

3. Heard Ms. Shuvra Mohapatra, learned Amicus Curiae appearing

for the appellants and Mr. Sarathi Jyoti Mohanty, the learned Additional

Standing Counsel appearing for the State.

The appeal was heard on 14.10.2025 and the judgment was

reserved. Ms. Mohapatra, learned Amicus Curiae has filed written note

of submission.

4. The prosecution case, in brief, is that on 13.04.1990 at about 5:00

P.M., the Inspector of Supplies, Headquarters, Chatrapur, accompanied

by the Executive Magistrate, Chatrapur, and other Inspectors, conducted

a raid at the mill premises of the accused, K. Sankaranarayana Subudhi,

situated at Aska Road, Berhampur. The said accused was admittedly the

proprietor of the mill; however, he was not present during the time of

inspection. At the time of the raid, accused Hussain Khan was found

operating the mill.

During the inspection, the officials detected 93 quintals of biri, 12

quintals of biri dal, 22 quintals of mung, and 8 quintals of mung dal

stored within the premises. On being asked, accused Hussain Khan failed

to produce any valid licence authorizing the storage of such heavy

quantities of pulses beyond the permissible limit. Consequently, the

stock was seized under a seizure list prepared in the presence of

witnesses, namely, the Executive Magistrate, Inspector K.K. Patnaik,

and one Pradeep Kumar Panigrahi and was left in the zima of one Siva

Kumar Agarwalla.

Upon further enquiry, accused Hussain Khan stated that they had

submitted an application for a licence along with a treasury challan of

Rs.100/- under Challan No.150 dated 13.02.1989 towards the licence

fee; however, no licence had yet been issued. On verification, the

Inspector found that no such application had in fact been made for

obtaining a licence. Thereafter, the Inspector lodged the prosecution

report against the accused persons, leading to the institution of the

present case.

5. The prosecution, in order to substantiate its case, examined 3

witnesses and one witness was examined by the defence. P.W.1 was the

then Inspector of Supplies attached to the office of Sub-Collector,

Berehampur, P.W.2 was the then Inspector of supplies in the office of

the C.S.O., Ganjan, Chatrapur. P.W.3 was the then Executive Magistrate

at Chatrapur. Whereas the Defence witness D.W.1 was the then Junior

Clerk at the office of the C.S.O.

6. The learned trial Court, placing considerable reliance on the

official evidence and disregarding the defence plea that an application

for a licence had already been submitted as evidenced by Ext. B

produced by the sole defence witness (D.W.1), held that the existence of

such an application could not serve as a justification for the accused-

appellants to contravene the law in force. Consequently, the Court found

the accused-appellants guilty of violating Clauses 3(2) and 12 of the

Orissa Pulses, Edible Oilseeds and Edible Oil Dealers (Licensing) Order,

1977, read with Notification No. 26011 dated 12.08.1988, which is

punishable under Section 7 of the Essential Commodities Act. The

appellants were accordingly sentenced to undergo rigorous imprisonment

for a period of one year and to pay a fine of ₹5,000/-, and in default of

payment of fine, to further undergo rigorous imprisonment for one

month.

7. The appellants being seriously aggrieved by the findings recorded

by the learned trial Court which led to their conviction and sentence have

filed the present appeal.

8. In continuation of the submissions made before this Court, Ms.

Shuvra Mohapatra, learned Amicus Curiae appearing on behalf of the

accused-appellants, advanced a detailed argument emphasizing that the

principal defence in the present case revolves around the fact that an

application for the requisite licence had already been submitted to the

competent authority and was pending consideration at the relevant time.

It was contended that the accused-appellants could not be said to have

wilfully contravened the provisions of law, as they had taken necessary

steps towards compliance prior to the date of inspection.

To substantiate this plea, reliance was placed upon the testimony

of D.W.1, which, according to the learned Amicus Curiae, clearly

demonstrates that the application for the licence had indeed been made

and was under process. The relevant portion of the evidence of D.W.1 is

reproduced herein below for convenient reference:

"The application of K. Sankarnarayan Subudhi for issuance of producer licence for running a dal Mill was received in our office vide entry No.1045 dated 16.2.89 in the Register maintained in the office of the Civil Supply Office, Ganjam, Chatrapur. This is the relevant entry marked as Ext A. The said application was sent to the Sub- Collector, Berhampur vide letter No.2941 dated 25.5.89 for enquiry. The Sub-Collector again, sent the said application

to Sri S.C.Padhy, Inspector of Supplies for enquiry. But the Civil Supply Office has not received any "report from the Sub-Collector as yet despite reminders, issued from time to time. Accordingly, while sending the Despatch Register, the C.S.O has issued a forwarding letter to this court about the position of the petition under which, the same could not be submitted before the Court. Ext. B is the said forwarding letter."

In addition to the said oral testimony, Exhibit-B was also

produced and exhibited during trial, which, as per the defence,

conclusively established that an application for the licence had been duly

submitted along with the prescribed treasury challan. It was, therefore,

argued that the trial court failed to properly appreciate this material piece

of evidence and that such an omission has resulted in a miscarriage of

justice.

The learned Amicus Curiae further submitted that, apart from the

above aspect, there were several other discrepancies in the prosecution

case, particularly relating to the weighment and quantity of the seized

stock, as well as in the overall appreciation of the evidence adduced.

These inconsistencies, coupled with the existence of the issuance of the

pending licence, were significant factors that should have been given due

consideration by the learned trial court before recording a finding of

guilt.

It was finally contended that the facts of the present case are

squarely covered by the decision of this Court in V. Manmath Rao v.

State1, wherein a similar issue was considered. In that case, the Court

had held as follows:

"11. The reading of the conclusion drawn by the trial court while dealing with the defence witnesses appears that the trial court has not appropriately appreciated the evidence led by the accused appellant in the light of the settled position of law. At this stage, it is apt to rely upon the judgment of the Andhra Pradesh High Court in Criminal Appeal No.753 of 1988 in the matter of Balasa Venkatesa Perumal vrs. State of Andhra Pradesh reported in MANU/AP/0354/1989. The Hon'ble Court in the said judgment in paragraph-6 has held as under:

"6. In view of this position of law as regards mens rea, it is to be seen whether the appellant herein has successfully discharged the burden of proving that he did not have the mens rea, viz, culpable mental state in hulling the paddy of the foodgrain dealers without the permit under clause 10 of the AP Rice Procurement (Levy) Order for being punished under sec. 7 of the Essential Commodities Act. In this case there is no dispute as regards the actual hulling of the paddy of the food grain dealers by the accused. But the contention of the accused is that he bona fide believed that he would be granted the permit required under clause 10 of the order, for

which he made the necessary application long before Even at the time when he was examined under sec. 313 Cr.PC. the accused stated that he submitted the necessary application for grant of permit under Cl. 10 of the order and was pursuing it. True copies of the said applications were also filed by the accused. Further the accused appellant was regularly submitting 'C' forms. Apart from all this there is no order rejecting the applications put in for grant of permit by the accused. In these circumstances, the appellant had: bonafide believed that the permit would be granted at any time and that it was only getting delayed on account of official reasons. It is under that hope that he was hulling the rice of foodgrain dealers. Thus, the accused has proved beyond all reasonable doubt that he did not have the culpable mental state while hulling the paddy of the foodgrains for the act to amount to an offence punishable under sec, 7 of the Act. Accordingly, there is no offence made out by the prosecution against the accused for purposes of upholding the conviction and sentence under sec. 7 of the Act. The conviction and sentence are accordingly set aside and the accused-appellant is acquitted. The appeal, thus is allowed and the fine amount, if any paid may be refunded to the appellant."

12. Similarly, the Hon'ble Supreme Court in the matter of Nathulal vrs. State of Madhya Pradesh reported in AIR 1966 SC 43 has held as under:

"9. But the appellant at the material time did store foodgrains considerably in excess of hundred maunds and held no licence to carry on the business as a dealer under the Licensing Order. His defence at the trial for contravention of Section 3 of the Order was that he had applied for a licence and had deposited the requisite fee for obtaining a licence and had submitted an application in that behalf and had since that date continued to submit fortnightly returns of receipts and sales of foodgrains

regularly. He also submitted that he had "made efforts for two months to get the licence" and the Inspector had assured him from time to time that he (the appellant) "need not worry and the licence would be sent to him at his residence". This clearly amounts to an admission that the appellant knowingly carried on business as a dealer without a licence. It is true that he carried on the business as a dealer in the expectation based on assurances given to him by the Inspector that a licence will be issued to him, but in carrying the business as a dealer he contravened Section 3 of the Order, because he held no licence. The authorities under the Order are not bound to issue a licence merely because it is applied for, nor is there any provision in the Order, as is to be found in certain statutes relating to administration of Municipalities, that permission shall be deemed to be issued if for a period specified in the statute no reply is given by the prescribed authority to an application for grant of permission."

13. Mr. Mohanty, learned Amicus Curiae submitted that the case of the present appellant is directly covered by the judgment as cited above. On the contrary, Ms. Suvalaxmi Devi, learned counsel appearing for the State has vehemently argued that the evidence of the prosecution is unimpeachable, trustworthy and all the witnesses have sustained extensive cross examination, but defence could not elucidate anything which could create doubt to the prosecution version and benefit could be given to the accused.

14. I have carefully gone through the evidence brought on record by the parties and also taken into consideration the argument advanced by both the parties. True is that the prosecution could prove the seizure of huge quantity of pulse from the possession of the appellant from his mill run by him and the godown. But it is also emanating from the record that the appellant had already applied for the license by then. Ext.10 and Ext.11, which have been proved on record in addition to the statement of the accused under Section 313 Cr.P.C. coupled with the

defence evidence, makes it undoubtedly clear that at the time of raid the application of the appellant for grant of license was pending before the authority. Therefore, the appellant is covered by the ratio of the judgments cited by Mr. Mohanty. By extending the benefit of doubt to the appellant in the light of the ratio of the judgments in Nathulal (supra) and Balasa Venkatesa Perumal (supra), I am inclined to give indulgence to the appellant and set aside the impugned judgment of conviction and order of sentence dated 05.07.1996 passed by the learned Second Addl. Sessions Judge-cum-Special Judge, Ganjam, Berhampur in T.R. No.1/96 (72/95 GDC), corresponding to G.R. Case No.27/94 (V)."

Relying on the ratio laid down in the said decision, the learned

Amicus Curiae urged that the conviction and sentence recorded against

the appellants are unsustainable in law and deserve to be set aside.

9. On the contrary, Mr. Sarathi Jyoti Mohanty, learned Additional

Standing Counsel appearing for the State has vehemently argued that the

evidence of the prosecution is unimpeachable, trustworthy and all the

witnesses have sustained extensive cross examination, but defence could

not elucidate anything which could create doubt to the prosecution

version and benefit could be given to the accused.

10. Upon careful consideration of the submissions advanced by the

learned Amicus Curiae as well as the learned Additional Standing

Counsel for the State, and after a thorough examination of the materials

available on record, this Court finds it necessary to assess whether the

learned trial Court had duly appreciated the defence plea and the

evidence adduced in that regard.

11. From the evidence of D.W.1, as reproduced hereinabove, and the

documentary evidence marked as Exhibit-B, it clearly emerges that an

application for the grant of a producer's licence had in fact been made by

the accused-appellant, K. Sankaranarayana Subudhi, much prior to the

date of inspection. The testimony of D.W.1 specifically indicates that the

said application, duly entered in the official register on 16.02.1989, had

been forwarded to the Sub-Collector, Berhampur, for necessary enquiry,

and despite reminders, no report had been received from the said office.

This fact is further corroborated by the forwarding letter (Exhibit-B)

issued by the Civil Supplies Officer, confirming that the application was

still pending consideration at the relevant time.

12. The learned trial Court, however, appears not to have properly

appreciated this crucial aspect of the matter, that a valid application for

licence was indeed in existence and was under official process. Instead,

the learned trial Court proceeded to record a finding of guilt solely on the

basis of the alleged storage of pulses beyond the permissible limit,

without due regard to the bona fide conduct of the accused in having

already initiated the process of obtaining a licence.

At this juncture, it is relevant to refer to the reasoning adopted by

this Court in V. Manmath Rao (supra) which, in turn, relied upon the

principles laid down in Balasa Venkatesa Perumal v. State of Andhra

Pradesh2 and Nathulal v. State of Madhya Pradesh3.

The ratio emerging from the aforesaid decisions makes it

abundantly clear that when an accused has already applied for a licence

and has deposited the requisite fee, and when such application remains

pending for reasons beyond his control, it cannot be said that he

possessed the requisite mens rea to wilfully contravene the provisions of

the Essential Commodities Act or the Orders framed thereunder. In such

circumstances, the continuation of business or storage of goods in

anticipation of the grant of a licence cannot, by itself, constitute an

offence attracting penal consequences under Section 7 of the said Act.

MANU/AP/0354/1989

AIR 1966 SC 43

13. Applying the same principle to the facts of the present case, this

Court is of the considered opinion that the appellants had taken all

necessary steps towards compliance with the licensing requirements, and

the pendency of their application before the competent authority negates

the element of deliberate violation. The learned Trial Court, therefore,

erred in overlooking this material fact and in failing to extend the benefit

of doubt to the appellants.

14. In view of the above discussion, and in light of the ratio laid down

in V. Manmath Rao v. State, Balasa Venkatesa Perumal v. State of

Andhra Pradesh, and Nathulal v. State of Madhya Pradesh (supra), this

Court is of the considered view that the conviction and sentence imposed

on the appellants cannot be sustained in law. The impugned judgment of

conviction and order of sentence dated 11.10.1999 passed by the learned

1st Additional Sessions Judge, Berhampur in 2(c)C.C. No.5/93 / T.R. No.

19/96 are accordingly set aside.

15. Resultantly, the Criminal Appeal is allowed. The appellants are

acquitted of the charges framed against them. Their bail bonds, if any,

stand discharged.

16. This Court acknowledges the effective and meaningful assistance

rendered by Ms. Shuvra Mohapatra, learned Amicus Curiae in this case.

Learned Amicus Curiae is entitled to an honorarium of Rs.7,500/-

(Rupees seven thousand five hundred) to be paid as a token of

appreciation.

(S.S. Mishra) Judge

The High Court of Orissa, Cuttack.

Dated the 28th October, 2025/ Swarna

Designation: Senior Stenographer

Location: High Court of Orissa