Harishchandra vs State Of Madhya Pradesh

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Criminal Appeals Nos. 211 to 217 of 1962

Decision Date: 24 September 1964

Coram: N. Rajagopala Ayyangar, A.K. Sarkar, R.S. Bachawat

In the case titled Harishchandra versus State of Madhya Pradesh, the judgment was delivered on 24 September 1964 by the Supreme Court of India. The opinion was authored by Justice N. Rajagopala Ayyangar, who was joined on the bench by Justices A. K. Sarkar and R. S. Bachawat. The petitioner was Harishchandra, and the respondent was the State of Madhya Pradesh. The decision was reported in the 1965 volume of the All India Reporter at page 932 and also in the Supreme Court Reports (First Series) at page 323. The statutory provision under consideration was the Essential Supplies (Temporary Powers) Amendment Act, 1950, which is identified as Act 52 of 1950, specifically the proviso to section 17(4). The proviso raised questions about whether a central legislation that was extended to a Part B state would cause a corresponding state notification, which had not been expressly repealed, to survive, whether subordinate legislation could continue after the repeal of its parent law, whether an association of persons could be treated as a “person” for the purpose of prosecution, and what liability, if any, attached to the president of such an association.

The headnote summarized that the Indian Scrap Order of 1943, originally promulgated under the Defence of India Rules, had been preserved after the expiration of those rules by the Essential Supplies Act of 1946. By virtue of Central Act 52 of 1950, the Essential Supplies Act was extended, among other territories, to the Part B state of Madhya Bharat. Madhya Bharat already possessed its own legislation on the same subject, namely the Madhya Bharat Essential Supplies Act of 1948, under which the Madhya Bharat Scrap Order of 1949 had been issued. When Act 52 of 1950 extended the central legislation to Part B states, section 17(4) expressly provided that the “corresponding law” in the state would be deemed repealed, albeit with a proviso that any orders, directions, or similar instruments issued under the repealed law would continue to have effect.

The appellant, who acted as the President of the Scrap Dealers Association of Indore, faced prosecution on the allegation that the association had sold scrap iron at rates exceeding those fixed by the Indian Scrap Order. The defence presented by the appellant asserted that the sales were made at prices fixed by a notification dated 26 August 1949 issued under the Madhya Bharat Scrap Order, and that this notification remained in force. The trial court initially acquitted the appellant, but the High Court reversed that decision and convicted him. The appellant subsequently obtained special leave to appeal to the Supreme Court. In his submissions, the appellant made two principal arguments: first, that the Madhya Bharat Scrap Order had not been expressly repealed by the Indian Scrap Order and therefore, by virtue of the proviso to section 17(4) of Act 52 of 1950, it continued to be operable, and that the 26‑August‑1949 notification persisted as an independent piece of subordinate legislation; second, that as President of an unincorporated association, he could not be held personally liable for any sale exceeding the authorised maximum price that was carried out by a munim or by munims acting on behalf of the association.

The Court held that, although the central notification extending the Indian Scrap Order to Madhya Bharat did not expressly state that the Madhya Bharat Scrap Order was repealed, the two orders were not identical and could not operate concurrently. Consequently, it was evident that the extension of the Indian Scrap Order to Madhya Bharat resulted in the repeal of the Madhya Bharat Scrap Order and its replacement by the central law.

The Court observed that when the Indian Iron and Steel (Scrap Control) Order was extended to Madhya Bharat, the pre‑existing Madhya Bharat Scrap Order was inevitably repealed and superseded by the Indian legislation. The Court noted that the specific notification dated 26 August 1949 could not continue to have effect even if it were characterised as an independent piece of subordinate legislation made under State law. Relying on the authoritative treatise by Craies, the Court explained that whenever the primary statute that empowers the making of by‑laws is itself repealed, those by‑laws are impliedly repealed unless the repealing statute expressly preserves them. Because the parent order of 1949, which authorized the notification, had been repealed without any saving provision, the notification likewise ceased to have any legal force. The Court further examined the definition of “person” contained in the General Clauses Act and held that the term embraces an unincorporated body of individuals. In the facts before the Court, the unincorporated Scrap Dealers Association had been granted the privilege of obtaining scrap at rates more favourable than those available to ordinary dealers, and the Association was consequently bound by statutory controls that required it to sell the scrap procured from regulated sources at the prices specified by the authorities. The Court rejected the argument that the Association, being unincorporated, could escape penal liability for selling scrap at rates not authorised by the controlling notification. Accordingly, the President of the Association was found liable under section 8 of the Essential Supplies (Temporary Powers) Act, 1946, which makes the abetment of a contravention of any order made under that Act an offence. The Court referred to the precedent set in Watson v. Winch, 1916 1 K.B. 688, and to the sixth edition of Craies on Statute Law, page 332, in support of its reasoning.

The judgment was delivered in the criminal appellate jurisdiction of the Supreme Court in Criminal Appeals Nos. 211 to 217 of 1962, which were filed by special leave against the order dated 5 May 1962 of the Madhya Pradesh High Court, Indore Bench. Counsel for the appellant were C. B. Agarwala and Rameshwar Nath, while counsel for the respondent were B. Sen and I. N. Shroff. The Court noted that all seven appeals were connected because they involved the same appellant and raised an identical legal issue. By virtue of the special leave granted, the Supreme Court entertained a challenge to the common judgment of the Indore Bench that had convicted the appellant of contravening the Indian Iron and Steel (Scrap Control) Order, 1943. The appellant, who served as President of the Scrap Dealers Association at Indore, had been prosecuted before the Additional City Magistrate, Indore, in seven separate criminal cases instituted by the State of Madhya Pradesh. The charges alleged that he had sold, or caused to be sold, scrap iron to various customers on different occasions at a price higher than that authorised by the notification dated 30 September 1952 issued by the Steel Controller under the Order, thereby violating section 8(4) of the Iron and Steel (Scrap Control) Order, 1943. The magistrate had initially acquitted the appellant, a decision that was subsequently set aside on appeal by the State Government, leading to his conviction and the imposition of a fine of Rs 100 in each case, with imprisonment as a default for non‑payment. The correctness of the High Court’s judgment was the subject of review in these appeals.

The Additional City Magistrate originally acquitted the appellant, but the State Government filed appeals. The learned judges hearing those appeals set aside the magistrate’s decision, convicted the appellant of the alleged offences, and imposed a fine of one hundred rupees in each of the seven cases, prescribing imprisonment should the fines remain unpaid. The appellant now challenges the correctness of the High Court’s judgment that affirmed those convictions and sentences. To understand the appellant’s arguments, the Court finds it necessary to briefly recount the legislative history governing the control of scrap‑sale prices. The Defence of India Act, 1939 granted the Central Government authority to formulate rules intended to maintain supplies and services essential to the community. Pursuant to that authority, Rule 81(2) of the Defence of India Rules enabled the Central Government, insofar as it deemed necessary or expedient for maintaining essential supplies and services, to issue orders for controlling the prices or rates at which any articles or things might be sold, and also to relax such prices or rates where appropriate. Exercising this power, the Central Government issued the Iron & Steel (Scrap Control) Order, 1943—referred to in the judgment as the Indian Scrap Order—on 25 February 1943. Under the Government of India Act, 1935, the provisions of that Order would ordinarily have expired six months after the emergency proclamation was revoked, as provided by section 102(3)(a). To prevent that lapse, the Emergency Provisions Continuance Ordinance, 1946 was promulgated on 25 September 1946, extending the operation of several control orders, including the Indian Scrap Order. Subsequently, the ordinance was replaced by permanent legislation, namely the Essential Supplies (Temporary Powers) Act, 1946 (Act 24 of 1946), which contained a clause—section 17(2)—authorising the continued operation of the existing control orders. Section 8(4) of the Indian Scrap Order expressly prohibited the sale of scrap at prices exceeding those fixed by the appointed Controller. It is uncontested that the transactions for which the appellant was prosecuted involved sales at rates above the maximum permitted by that provision. Although several defences were originally raised, the only ones that remain for consideration are two: first, the legal effect of parallel state provisions that also regulated scrap‑sale prices and were operative in the Part B State of Madhya Bharat, of which Indore was a part; and second, whether the appellant, as President of the unincorporated Scrap Dealers Association, could be held personally liable for a sale that exceeded the authorised maximum price when such a sale was effected by a munim or munims of the Association.

In this case the Court set out a concise history of the parallel statutes that regulated the price of scrap in the Part B State of Madhya Bharat. Those statutes unquestionably remained operative in the State until 12 September 1950, when the Indian Scrap Control Order, 1943 was, by its terms, made applicable to the State. The principal issue raised by counsel for the appellant concerned whether a particular notification that had been issued under the State law and was in force on that date continued to have effect thereafter. The State’s legislative activity on the subject began on 9 October 1948 with the issuance of the Madhya Bharat Essential Supplies (Temporary Powers) Ordinance, 1948, which was essentially a copy of the Indian Essential Supplies (Temporary Powers) Ordinance, 1946. When the Indian Ordinance was superseded by the Essential Supplies (Temporary Powers) Act, 1946, Madhya Bharat enacted a corresponding statute, namely the Essential Supplies (Temporary Powers) Act (Samvat 2005) (Madhya Bharat Act III of 1948). The State legislation listed “essential commodities” that included iron and steel, as provided in section 2(3)(7). Section 4 of that Act empowered the Government, whenever it deemed necessary or expedient for maintaining or increasing supplies of any essential commodity or for ensuring their equitable distribution and availability at fair prices, to issue an Order, notified in the Official Gazette, that could regulate or prohibit the production, supply, distribution, movement, trade and commerce of such commodities. Sub‑section 2 of the same provision allowed an Order made under subsection 1 to specifically control the prices at which any essential commodity could be bought or sold. Exercising the powers granted by this legislation, the Director of Civil Supplies of Madhya Bharat, to whom the State Government had delegated the authority, issued on 4 June 1949 the Madhya Bharat Iron, Steel and Scrap (Production, Procurement and Distribution) Control Order, 1949. Clause 5 of that Order authorized the Director to from time to time specify the maximum wholesale and retail prices at which “iron and steel, scrap or specified articles made thereof” could be sold by various categories of persons, namely a producer, a controlled stockholder, a registered stockholder, a controlled dealer and a scrap merchant. The Order defined each of these categories. Acting under the authority of clause 5, the Director of Civil Supplies issued on the same day, 4 June 1949, a notification that read: “In exercise of the powers conferred on the Director under clause 5(1) of the Madhya Bharat Iron, Steel and Scrap (Production, Procurement and Distribution) Control Order, 1949, I hereby specify that the Price Schedules as may be in force for the time being under …… Iron and Steel Scrap Control.”

In the judgment it was observed that the order issued by the Government of India governing the sale of iron and steel by producers, controlled and registered stockholders and scrap merchants was to be applied in Madhya Bharat in a similar manner, with necessary modifications. The modification required that registered stockholders were to sell their material to controlled dealers at the rates specified in column II of the Government of India price schedule that was then in force. When a registered stockholder obtained iron or steel from a producer, the purchase price had to be the column I rate; if the material was obtained from a controlled stockholder, the purchase price had to be the column II rate. In addition, the order stipulated that controlled dealers operating in Madhya Bharat were permitted to sell the material to consumers only if the profit margin did not exceed thirty rupees per ton. The order further allowed that any additional local charges could be imposed by the Director of Civil Supplies or any officer authorized by him, provided that such charges were consistent with the overall scheme of the price control.

The court noted that comparable orders had also been issued under the Indian Scrap Order of 1943, and that those orders employed the same classification of dealers and the same pricing mechanism. The notification issued by the Steel Controller to the Government of India, which formed the basis of the Madhya Bharat order, contained a schedule that listed the maximum permissible prices in five columns. The first column identified the item number, the second column gave the description or classification of the material, and the next three columns—labelled I, II and III—set out the maximum basic price per ton for sales at Calcutta, Bombay and Madras respectively. Adjustments were provided for determining the price applicable at other centres. Column I applied to sales made by controlled sources other than those described in column II; column II was headed “specified prices fixed for sales by scrap merchants who have been declared controlled sources”; and column III set the maximum price for sales by all other persons, including retail dealers selling to the public. The three columns therefore established a hierarchy of price ceilings, with column I being the lowest, column II slightly higher, and column III the highest.

The judgment further recorded that it was an established fact that the Scrap Dealers Association of Indore, of which the appellant was the president, had been declared a “controlled source.” Consequently, the members of that unincorporated association were required to sell scrap iron at the rates specified in column II of the schedule. The court did not feel it necessary to reproduce the exact monetary amounts at which the alleged illegal sales were made; it was sufficient to note that the association’s members had sold scrap iron at prices that were higher than the column II rates and, in some instances, at the higher column III rates. The first argument presented by the appellant’s counsel, Mr Agarwala, was that the association’s sales at the column II price were authorized and lawful because of a notification issued by the Government of Madhya Bharat on 26 August 1949. The court indicated that this submission would be examined in relation to whether the 1949 notification was still in effect at the time of the sales in 1956 and whether it survived subsequent Indian legislation extending to the state.

In this case, the Court noted that the price listed in column II was claimed to be authorized and lawful because of a notification issued by the Government of Madhya Bharat on 26 August 1949. The principal issue presented before the Court was whether that notification remained in effect on the date of the sales in 1956, which formed the basis of several prosecutions, and whether it survived the later Indian legislation that was extended to the State, a point to be addressed later. Before examining those questions, the Court considered the nature of the notification. The Scrap Dealers Association of Madhya Bharat had made a representation to the State Government alleging that, although the dealers who were members of the Association were classified as a Controlled Source and consequently obliged to sell at the prices fixed in column II, the Association should be granted a special privilege allowing it to sell at the prices fixed for the residuary class of dealers in column III. An Advisory Committee appointed by the State Government examined this representation and issued a direction that, for the goods sold to consumers by the Scrap Association at its regional headquarters, the Association would be permitted to charge the column III rates instead of the column II rates. The Court recorded that the Association had continued to sell at those column III rates thereafter. The Court observed that, if that direction were valid and had not been challenged by the respondent as beyond the powers of the State Government, the appellant could not have been guilty of the offence with which he was charged. The remaining question, therefore, was whether that direction or the modification of the prices fixed under section 5(1) of the Madhya Bharat Scrap Control Order—by incorporating the notification of the Steel Controller of the Government of India—still existed in 1956 when the alleged contraventions of the Indian Scrap Order occurred. The Court recalled that the notification dated 4 June 1949, previously extracted, had been issued under the Madhya Bharat Iron and Steel Control Order, 1949, which itself was promulgated under the Madhya Bharat Essential Supplies (Temporary Powers) Act, 1948. However, that Act had been repealed by the Essential Supplies (Temporary Powers) Amendment Act, 1950 (Act 52 of 1950), which extended the Essential Supplies (Temporary Powers) Act, 1946 to the Part B States as and when specified by the Central Government. By a subsequent notification, the Central Government made the Essential Supplies Act, 1946 applicable to the Part B State of Madhya Bharat from 17 August 1950. The effect of this extension was set out in section 10 of Act 52 of 1950, which provided that if, immediately before the day on which the Act came into force in a Part B State, any law corresponding to it was in force in that State, such corresponding law would on that day be repealed insofar as it related to essential commodities governed by the Act, but any order that was in force immediately before that day would continue to be deemed an order made under the Act, and all appointments, licences, permits and directions issued under that order would likewise continue as if made under the new legislation.

The amendment appended to section seventeen of Act twenty‑four of 1946 inserted a new sub‑section designated as sub‑section four. The wording of that sub‑section provides that if, immediately before the date on which the Act becomes operative in a Part B State, there exists in that State any law that corresponds to this Act, such corresponding law shall, on that day, be repealed to the extent that it relates to any of the essential commodities regulated by this Act. The provision further includes a proviso stating that any order which was made and was in force immediately before that day shall continue to remain in force and shall be deemed to be an order made under this Act. Moreover, all appointments, licences, permits and directions that were issued under any such order and were in force immediately before that day shall likewise continue and shall be deemed to have been made, granted or issued pursuant to this Act.

If the main part of sub‑section four were to operate without the accompanying proviso, the consequence would have been a complete repeal not only of the Madhya Bharat Essential Supplies (Temporary Powers) Act of 1948—which was the “corresponding law” then operative in that State—but also of all subordinate legislation that had been promulgated under it. Such subordinate legislation included the various Control Orders and the price‑fixing orders issued by the Director. However, because the proviso is expressly incorporated, the repeal of the parent enactment does not extinguish the orders made under it; instead, those orders are continued and are considered to have been made under the Indian Act.

Counsel for the petitioner, Mr Agarwala, placed significant emphasis on the language of the proviso. He argued that, by virtue of that language, the proviso sustained not only the Madhya Bharat Scrap Order dated 4 June 1949 and the price‑fixation provision under section five (i) of that order enacted on the same date, but also the variation of prices that the Association was authorised to levy as a result of the Government Order dated 26 August 1949. That government order permitted the Association, even though it was listed as a dealer in column II, to sell at the prices fixed for persons appearing in column M. The Court did not need to examine in detail whether the 26 August 1949 direction or notification qualified as “a direction issued under any such order” within the scope of the proviso; it proceeded on the assumption that it did, thereby adopting the construction advocated by counsel.

Subsequent to the amendment effected by Act 52 of 1950, the replacement of the Madhya Bharat law on this subject did not cease. By a government notification dated 12 September 1950, the Indian Scrap Order of 1943 was extended to apply to Madhya Bharat. The legal effect of this extension is the focal point of the appeals under consideration. Although the notification effecting the extension did not expressly state that the Madhya Bharat Scrap Iron & Steel etc. Order of 1949 was to be repealed, the implication is that the two Control Orders could not operate concurrently. Accordingly, the Indian Scrap Order would have supplanted and replaced the State law, a conclusion that requires careful scrutiny within the present proceedings.

The Court observed that if two control orders could not operate at the same time, the logical result would be that the Indian Scrap Order would repeal and replace the State law. It noted that even in the hypothetical situation where the provisions of the two orders were identical, it might still be appropriate to hold that the Indian Scrap Order superseded the State law so as to give effect to its extension to Madhya Bharat. However, the Court found that this was not the situation here because there were material differences between the two sets of provisions, making their simultaneous operation impossible. For example, Rule 3 of the Indian Scrap Order expressly prohibited producers from acquiring or agreeing to acquire scrap except under a written order issued by the Controller, a requirement that has no counterpart in the Madhya Bharat Scrap Order. In a similar vein, Rule 6 of the Madhya Bharat Order, which corresponds to Rule 8(4) of the Indian Scrap Order, does not contain the prohibition against acquiring scrap at a price higher than the maximum fixed, a restriction that is present in the Indian order. Moreover, Rule 7 of the Madhya Bharat Order deals with restrictions on the movement of scrap, a matter not addressed at all by the Indian Scrap Order. The Court pointed out that many such variations could be cited, but it was unnecessary because it had already been conceded that the provisions of the two orders were not identical. The Court emphasized that although both orders aimed at achieving substantially the same objective, their substantive provisions differed, and therefore, on the extension of the Indian Scrap Order to Madhya Bharat, the Madhya Bharat Scrap Order would be deemed repealed and supplanted by the Indian law. Counsel for the appellant, Mr Agarwala, argued that this inference should not follow because the Madhya Bharat Scrap Order possessed a higher efficacy or a superior footing, having been continued by the proviso to section 17(4) of Act 24 of 1946, and that the notification should be treated as one made under the Essential Supplies (Temporary Powers) Act itself. The Court held that even if this argument were legally sound, it would not aid the appellant, since the Indian Scrap Order was likewise preserved by a saving clause expressed in exactly the same language in the Essential Supplies (Temporary Powers) Ordinance 1946 and the Act of 1946, as referenced in sections 17(2) and 17(3) of Act 24 of 1946. Furthermore, the Court noted that an order or notification issued under the Essential Supplies (Temporary Powers) Act could be amended, modified, or cancelled, and that even if the Madhya Bharat Scrap Control Order and its related notifications were deemed to have been issued under the 1946 Act, they could still be altered or replaced by other subordinate legislation emanating from the same parent act. The Indian Scrap Order of 1943 was such a piece of subordinate legislation, being deemed to have been made under that Act. Consequently, when the Indian Scrap Order was extended to Madhya Bharat, it effectively replaced the Madhya Bharat Order on the same subject matter.

It was observed that any subsidiary rule issued under the same principal legislation could be altered, amended or replaced by later subordinate legislation that also derived its authority from that principal Act. The Indian Scrap Order of 1943 constituted one such piece of subordinate legislation because it was regarded as having been made under the Essential Supplies (Temporary Powers) Act, 1946. When the Indian Scrap Order was extended to the territory of Madhya Bharat, the effect was that it supplanted the Madhya Bharat Scrap Order that dealt with the same subject matter. Even assuming that the Madhya Bharat Scrap Order dated 4 June 1949 was repealed by the extension of the Indian Scrap Order to that region, counsel for the appellant, Mr Agarwala, argued that the direction contained in the State Government’s notification of 26 August 1949 constituted a special law that remained unaffected by the extension of the Indian Scrap Order to Madhya Bharat. He further contended that the extension of the Indian Scrap Order brought with it all the notifications issued by the Controller from time to time, and that after such extension every sale of scrap in Madhya Bharat would have to conform exclusively to the prices fixed by those notifications. This proposition was not contested. It was also not disputed that, according to the notifications fixing the prices at which various classes of dealers could sell scrap under the Indian Scrap Order, the Association of which the appellant acted as President fell within column II and therefore was bound to sell scrap only at the prices specified in that column.

However, the appellant submitted that even before the Indian Scrap Order was extended to Madhya Bharat in September 1950, the notification of 4 June 1949 itself limited the maximum prices in Madhya Bharat to those prescribed by the Controller in India, and that the permission granted to the Association represented in effect a local modification of the Indian Order. On that basis, the appellant argued that the direction issued by the State Government on 26 August 1949, which continued to operate after the repeal of the Madhya Bharat Temporary Powers Act, 1948 by virtue of the proviso to section 17(4) of Act 24 of 1946, was not displaced by the extension of the Indian Scrap Order to Madhya Bharat. The Court found this argument unconvincing. The Court held that the concession given to the Association by the 26 August 1949 notification could be examined from two alternative viewpoints. One view treated the direction as a modification of the prices fixed under section 5(1) of the Madhya Bharat Order, thereby incorporating the direction into the price fixation so that, in law, it became the price fixed by the Controller. Under this view, before the Indian Scrap Order was extended, the maximum prices that could be charged by dealers falling within column II in Madhya Bharat would have been those applicable to dealers in column III.

If the first interpretation were correct, then when the Indian Scrap Order was extended to Madhya Bharat without any saving clause or special provision for the Association’s sales, that order would override the earlier law and the special classification created by the Madhya Bharat legislation would no longer operate. In that situation, the fact that the prices fixed in Madhya Bharat for dealers in the three‑column schedule matched the prices fixed by the Controller in India would become irrelevant, because the authority for setting those prices would be traceable to Madhya Bharat law, not to the Indian statute. The alternative view was that the notification dated 26 August 1949 represented an independent piece of subordinate legislation made under the Essential Commodities Act and the Madhya Bharat Scrap Order, a point emphasized by counsel for the appellant. Even if that characterization were accepted, the appellant would gain no benefit, because the Madhya Bharat Essential Supplies Act had been repealed—albeit with a saving provision—but the Madhya Bharat Scrap Order had been repealed without any saving. Consequently, when the Scrap Order that had given effect to the subordinate rule or regulation was itself repealed, that subordinate rule would also be deemed repealed. As Lord Reading C.J. explained in Watson v. Winch, when a parliamentary Act is repealed it must be treated, except for completed transactions, as if it had never existed, and any bye‑law made under a repealed statute loses validity unless the repealing Act expressly preserves it. There was no saving clause in either the Central Government’s notification extending the Indian Scrap Order to Madhya Bharat or in the Scrap Order itself. Since the parent order that authorized the notification had been repealed without a saving, the 26 August 1949 notification, if it were an independent subordinate legislation, must also be considered repealed. Counsel for the appellant then referred to section 24 of the General Clauses Act No. X of 1897, arguing that the notification should be treated as a bye‑law that would survive the repeal of the Madhya Bharat Scrap Order. Section 24 provides that when a central Act or Regulation is repealed and re‑enacted, any appointment, notification, order, scheme, rule or bye‑law made under the repealed provision continues in force, to the extent it is not inconsistent with the re‑enacted provisions, and is deemed to have been made under the new provisions unless it is superseded. However, this argument was rejected as having no force because, as counsel conceded, the language of section 24 does not cover a repeal of the Madhya Bharat Scrap Order that resulted from the introduction of the Indian Scrap Order into the Madhya Bharat territory. The court therefore found the reliance on section 24 to be untenable.

The Court explained that the provision in Section 24 remains effective only until it is replaced by a later appointment, notification, order, scheme, rule, form or by‑law that is made under the re‑enacted legislation. The Court also noted that when a Central Act or Regulation has been extended to a local area by a notification under Section 5 or Section 5A of the Scheduled Districts Act, 1874, or by a similar law, and that extension is later withdrawn and then re‑extended to the same area or part of it by another notification, the Act or Regulation is to be regarded as having been repealed and re‑enacted in that area for the purposes of Section 24.

The Court considered the argument advanced by counsel that this submission lacked any force. Counsel conceded that the wording of Section 24 did not expressly apply to the repeal of the Madhya Bharat Scrap Order by the introduction of the Indian Scrap Order of 1943 into the Madhya Bharat territory. Nevertheless, counsel suggested that, even though the section was inapplicable, the underlying principle could still be invoked. The Court rejected this line of reasoning, observing that it assumed Section 24 to be merely a declaratory statement of a general rule of interpretation and that the same principle would operate even in the absence of that statutory provision. The Court referred to the authority in Craies on Statute Law, Sixth Edition, page 334, which states that if the statute under which by‑laws are made is repealed, those by‑laws are impliedly repealed and cease to have any validity unless the repealing statute expressly preserves them. The principle is that, when an Act of Parliament is repealed, it is to be treated, except for completed transactions, as if it never existed. Accordingly, the Court held that the submission had no merit and must be rejected.

The Court then turned to the second point raised by counsel, namely that the Scrap Dealers Association was an unincorporated body composed entirely of retail dealers, and that each dealer could individually sell at the column M rate, so the Association should not be penalised for selling at that rate. Counsel argued that, as an unincorporated body, the Association was merely the aggregate of its members and therefore possessed the rights of its constituent units. The Court found no merit in this argument. While the General Clauses Act defines “person” to include an unincorporated body of persons, the issue before the Court was not the sales made by individual dealers who formed the Association, but the sales made by and through the Association itself. The Court observed that the Association had been granted the facility to obtain scrap at more favourable prices than individual dealers and that it was the Association that was subject to control, requiring it to sell the scrap it had purchased from controlled sources at the prices specified in column II. Finally, counsel lightly suggested that the appellant was only the President of the Association, a point that the Court also dismissed.

The Court observed that the argument that the Association could not be held liable for sales carried out by its own employees did not succeed. It emphasized that there was no genuine dispute that the transactions in question were undertaken by the Association itself and that the rates applied to those sales had been determined by the Association as a governing body. Furthermore, the parties conceded that the rates fixed by the Association were higher than the rates that had been prescribed for the Association under the regulatory scheme. The Court then referred to section 8 of the Essential Supplies (Temporary Powers) Act, 1946, which provides that any person who assists or abets the breach of any order shall be deemed to have breached that order. Applying this statutory provision, the Court held that the appellant’s contention that it could escape liability because the sales were performed by its employees could not constitute a valid defence. In view of the fact that the Association had itself set the excessive prices and that the sales were conducted by the Association, the statutory provision treated the Association as having abetted the violation of the price control order. Consequently, the Court concluded that the appeals filed by the appellant could not be sustained. The Court therefore ordered that the appeals be dismissed, and this dismissal was confirmed as the final relief granted in the matter.