Syed Ahmed Aga v.  State of Mysore and Ors.

PETITIONER: Syed Ahmed Aga

RESPONDENT: State of Mysore and Others

DATE OF JUDGMENT: 02/ 05/ 1975

ISSUE:

1. Is a petition maintainable under Article 32 of the constitution challenging provisions of Article 19 that cause a restriction of trade on the Mysore Silk Worm and Seed Cocoon Act, 1960?
2. Whether article 304(b) imposed any additional restrictions on the commerce of silkworms?

RULE:

 1) Article 19(1)(g), 32 and 304(b) of Indian Constitution

2) Section 12, 18 of the Principal Act

CASE FACTS:

Petitioner challenged that the Mysore Silk Worm and Seed Cocoon Act of 1960 was amended and these amendments imposed additional restrictions on carrying on trade freely which is a fundamental right. It stopped professionals from professing trade without the president’s sanction under Article 304(b) of the Indian Constitution. This Act had President’s sanction but the amendment was not questioned or challenged. The respondent believed that under Article 32 there were restrictions covered under Article 304(b). However, the definition of freedom of trade under Article 19 is different from Article 304.

Under Section 12 as well different penalties could extend up to a fine. In section 12 subsection 5(a) it is mentioned that a person who tries to contravene the provisions of the act shall be punishable if the Director of Sericulture in Mysore gives him a chance to present himself, an opportunity to be heard, suspend, or cancel the license for preparing silkworm seed if is convicted twice for the same offense will be punished under this Act. There can also be cancellation of a license under clause (a) if there is an appeal made by a person to the Government to prescribe the decision as in the question of the Court of Law. Under Section 12 of the Principal Act, there are some cases of abetment and some are punishable with the Act for such offences. Certain offenses are cognizable are certain are not.

ANALYSIS:

The judgment was given by M.H. Beg who stated that under Article 304 the restrictions put on freedom of trade and commerce which had a different concept on an individual to carry on trade and business guaranteed under Article 19. He also believed that an individual’s rights were very direct and could be deprived of, some characteristics of article 304 might be of such nature that it seems to violate the right to practice trade and profession. But the fundamental rights come with reasonable classifications and some restrictions are otherwise valid. Thus, the State of Mysore tried to justify its amendments through a Presidential Sanction and at an appropriate stage. There are necessary amendments to be made under Section 18 of the Principal Act. Section 18 states the powers of amending government rules and to carry out different purposes, this section has reasonable restrictions on the powers of authorities, qualifications of the one who produces silkworms, granting fees and licenses, sanitary conveniences that provide for the production of silkworm seed,  licenses that are to be granted and maintained and restriction on the fee that is payable in cocoon market, the particulars of the market.

The arguments that were in front of the court were based on behalf of the State and its purview to frame rules and restrictions that were under Principal sanction. The Act also had been assigned the task to check silk quality and records of breeding of silkworms to be put fore in Mysore. The term “Cocoon” is also defined in this Act for regulating silkworm seeds, cocoon market yards, and stores and to be carried upon a licensed buyer. A reader also produces reelings to consolidate laws. It was urged to bring laws that would promote high-quality silk and reeling of silk. Petitioners stated that about 7% of the population was indulged in growing mulberry that would feed silkworms and around 2 acres of land were submitted in interest of silk products and public interest. Rule 3(1) was very strict and contained a prohibition against a silkworm seed than a licensed seed paper. Rule 5 provided grants to various license authorities in the area and section 7 prohibited cocoon makers from selling or agreeing with licensed buyers to purchase silkworm reels except from that market in their area. The increase in penalties would bring more enforceability and bring in a change of value.

The council also stated a few cases like Atiabari Tea Co. Ltd v. State of Assam[1] held that Assam taxation would be void for not having presidential sanction under article 304(b) and to enable restrictions on the Act. But since the amendments were different from the case situation it became irrelevant. Another case is the Automobile Transport (Rajasthan) Ltd. V. State of Rajasthan[2] both sides had a distinction between mere regulation and restriction imposed through Article 304. It held that there were taxation of motor vehicles was compulsory and that was justified.

Suba J Rao believed that the state could impose a non-discriminatory tax on goods imported from other states that were similar to the goods manufactured. There were also reasonable restrictions in the public interest.

In the case of Huges and Vale Proprietary Ltd and the state of New South Wales and Others and Commonwealth of Australia and Other Interveners,[3] it was held that every case has different circumstances, and economic events and must be maintained at State monopoly practically and in absolutely free manner.

JUDGMENT:

The court held that the citizens are free to approach the court in case they feel their fundamental rights are being violated (the right to carry on business and trade) in this case and this violation can severally affect their position in society and legality if they may exist. Their restriction is based on Article 304(b) but is of a character that differs from any individual citizen’s rights or impact that can be direct or indirect. Further stringent regulations already existed under the Principal Act and frame rules according to them. Different additional restrictions were put under amending act 4(1) and present section 7(2) that require a much more difficult area’s access to get cocoon. There has been an increase in penalties from a point of view that it breaks a restriction and penalties are a part of the procedure in the enforcement of restrictions. They do not create offenses and increase violations of trade and commerce. There are also additional restrictions that can be looked upon as additional restrictions from freedom of trade and commerce.

INFERENCES AND PERSONAL SCHOOL OF THOUGHT:

This case is correct in stating that fundamental rights come with a reasonable classification especially related to trade. In this case, trade rules were regulated so that the quality of silk became much better and refined which would in return become a mark of authenticity and increase profit-making business. The penalties have increased and become more strict so that a person thinks twice before committing any offense which would also increase the value for money. This would also help in increasing privatization and capitalization in the country. The measures taken will also help in getting a trademark on a particular good by the name of India. The sale of goodwill will eventually increase and create space in the market.

REFERENCE(S):

1) Editor_4, Indulia, B., Bhardwaj, P., & Gupta, Dr. S. (2021, March 20). Agreement in restraint of Trade. SCC Blog. https://www.scconline.com/blog/post/2021/03/20/agreement/#:~:text=The%20High%20Court%20of%20Delhi,is%20to%20that%20extend%20void.

2) Home | Supreme Court of India. (n.d.). https://main.sci.gov.in/jonew/judis/21548.pdf

3) Advocatekhoj.com. (n.d.). Syed Ahmed Aga vs. State of Mysore & Anr [1975] INSC 119 (2 May 1975): Judgments: Supreme court judgments: May 1975: Law library. AdvocateKhoj. https://www.advocatekhoj.com/library/judgments/index.php?go=1975%2Fmay%2F5.php

4) Syed Ahmed Aga etc. VS State of Mysore & another. Legal Authority. (n.d.). https://www.legalauthority.in/judgement/syed-ahmed-aga-etc-vs-state-of-mysore-another-33413

[1] Atiabari Tea Co. Ltd. v. State of Assam, (1961) 1 SCR 809

[2] Automobile (Rajasthan) Transport Ltd. v. State of Rajasthan, 1962 SCC OnLine SC 21

[3] HUGHES AND VALE PROPRIETARY LD. APPELLANT; AND STATE OF NEW SOUTH WALES AND OTHERS RESPONDENTS. AND COMMONWEALTH OF AUSTRALIA AND OTHERS INTERVENERS., [1955] A.C. 241