P L D 1977 Karachi 421 (PLP)

Z, A. CHANNA, J.‑This petition is by a person dealing in the business of meat and calls in question the validity of a notification, dated 21‑2‑1975, issued by the Commissioner of Karachi, respondent No. 2, under section 3 of the West Pakistan Foodstuffs (Control) Act, 1958, hereinafter referred to as the said Act, fixing the rates at which different types of mutton and beef would be sold. The impugned notification is in the following terms : OFFICE OF THE COMMISSIONER, KARACHI No. C. K./Miscellaneous/Notification/75 Karachi 21st February 1975 NOTIFICATION In exercise of the powers conferred by section 3 of the West Pakistan Foodstuffs (Control) Act, 1958 (West Pakistan Act XX of 1958) read with Government of Sind‑Food and Co‑operation Department Notifi cation No. S. O. (F‑I1I)‑(63)/?3, dated 13‑2‑19 5, it is hereby directed that the following rates of Meat & Beef throughout Karachi Division will be applicable with immediate effect. Rs. (1) Mutton (a) Breast & Neck 10.00 Per seer (b) Ran & Chops 10.50 (2) Beef (a) With bones 5.50 Cow Without bones 6.00 Buffalo (b) With bones 5.00 Without bones 5.50 Any violation of this order shall be punishable accordingly. (Sd.) Commissioner, Karachi.

2. We have heard Mr. Khalid Ishaq who appeared for the petitioner, ,and Usman Ghani Rashid, the learned Assistant Advocate‑General, who represented the two respondents. However, before considering the respective contentions of the learned counsel, it will be appropriate to refer to certain provisions of the said Act. Its preamble recites that it is being enacted as "it is expedient in the public interest to provide for the continuance of powers ‑to control the supply, distribution and movement of, and trade and commerce in, foodstuffs in West Pakistan." Section 2 of the said Act defines "food stuffs", "Government" and "notification". The power to control supply, distribution, etc., of foodstuffs and to prescribe their prices is conferred .by section 3, the relevant portion whereof is in the following terms "(1) The Government, so far as it appears to it to be necessary or expedient for maintaining supplies of any foodstuffs or for securing its equitable distribution and availability at fair prices, may be notified order, provide for regulating or prohibiting the keeping, storage, movement, transport, supply, distribution, disposal, acquisition, use or consumption thereof and trade and commerce therein. (2) Without prejudice to the generality of the powers conferred by sub section (1) an order made thereunder may provide (b) for controlling the prices at which any foodstuff may be bought or sold ;".

3. Section 4 of the said Act empowers Government, by notified order, to "direct that the power to make orders under section 3 shall, in relation to such matters and subject to such conditions, if any, as may be specified in the direction, be exerciseable also by an officer or authority subordinate to the Government". In exercise of this power. Government of Sind have issued notification, bearing No. S. O: (F‑III)‑4 (63)/73, dated 13‑2‑1975, empowering the Commissioner, Karachi, to exercise the powers of the Government in respect of meat (Mutton & Beef), milk, vegetables and pulses. It was in persuance of the powers delegated by this notification that respondent No. 2 has issued the impugned notification.

4. Mr. Khalid Ishaq, the learned counsel for the petitioner, attacked the validity of the impugned notification on several grounds. His first ground of attack was that the impugned notification was made without investigation and without bearing of parties. It will be seen that this ground consists of two separate parts. In support of the first part of this ground, the learned counsel for the petitioner submitted that the power to fix prices of a foodstuff under section 3 of the said Act could only be exercised for the purpose of securing its equitable distribution and availability at fair prices. What thus had to be fixed was not merely prices but "fair prices and the latter could not be done without associating the trade, that is the dealers in meat, who alone would be in a position to advise the authorities what relevant factors should be taken into consideration in fixing prices and also to give proper and correct information as to the cost involved in the various stages culminating in making dressed meat available to the consumer We regret that we are unable to find any force in the contention of the learned counsel. The law does not require association of the representatives: of the trade before fixing prices. As to the trade advising the authorities what factors and considerations are to be borne in mind in fixing prices and what are the charges and expenses properly incurred by a tradesman before he can make a foodstuff available to the consumer or buyer, we are of the opinion that Government had adequate machinery at its command to ascer tain such factors and matters. In airy case, it is for the authorities concerned to determine whether association of representative of trade is necessary and if so, to what extent. Neither any dealer in foodstuffs, the price whereof is fixed, nor the trade itself, has any right to claim association.

5. So far as the second part of the above objection by Mr. Khalid‑, Ishaq is concerned, namely, that the impugned notification was issued and prices of meat were fixed without proper investigation and hence the prices so fixed cannot be considered "fair prices", we are of the opinion that it is wholly misconceived and factually incorrect. A perusal of the summary for the Economic Sub‑committee of the cabinet, dated 22‑11‑1974, and the annexures thereto, which have been filed with the counter‑affidavit of the respondents, shows that the matter of fixation of the prices of mutton and beef had been thoroughly examined in all its aspects and at various levels. It shows that cost analysis we carried out on the basis of which tentative prices of meat were recommended. Thereafter, a working group consisting of the Joint Chief Economist, Government of Sind. the Chief Meat Inspector, K. M. C., and the Director, Poultry and Officer Incharge Experi mental Station, Animal Husbandry, was set up to examine the question in the light of the latest prices of animals. The report of the group was discussed in a meeting of the Price Establisation Board where it was decided that an independent study should be conducted by the Planning and Development Department, the Commissioner, Karachi and the Consumer's Council. It appears that on the basis of the price of the animals ascertained by the above three agencies, the Price Estabilization Board, after considering the pre% ailing prices of meat in other cities in Sind, and allowing for reasonable margin of profit, recommended different prices for the average and superior types of mutton and beef. Charts showing the basis of arriving at the said prices were appended to the summary. The charts show separately the cost structure of mutton and that of beef, and the various factors which have taken into consideration in working out the cost. The factors considered include the price of animals, the transport, labour, loading and unloading. charges, the expenses of fodder, the pit and K. M. C. Slaughter House charges and other expenditures of the butcher for cutting and selling of meat. To the cost structure thus worked out there was added a minimum margin of profit of eight annas per seer in the case of both mutton and beef. It. may be pointed out that the impugned notification has in fact fixed higher prices then even what were recommended by the Price Estabilization Board to the cabinet committee. There has thus, in our view, been a very thorough study and investigation carried out before the impugned notification, cuss issued.

6. The next ground on which Mr. Khalid Ishaq has challenged the impugned notification is that the power to fix prices under the said Act is not arbitrary and the several considerations which have been stated in ground (d) of the petition have not been taken into account by respondent No. 2 while issuing the impugned notification. Amplifying his arguments in support of this ground, Mr. Khalid Ishaq contended that the fixation of prices of any foodstuff under the said Act is permissible, as provided in sub section (1) of section 3 of the said Act, only for the purposes of‑ (a) maintaining supplies of such foodstuff; (b) securing its equitable distribution and availability at fair prices.

7. The learned counsel contended that supplies of any foodstuff cannot be maintained nor its equitable distribution and availability at fair prices secured unless the prices fixed are such as to give a reasonable margin of profit to the seller. tic submitted that if the price of any foodstuff is fixed below its cost of availability, then nobody would be interested in dealing in such foodstuff and consequently neither supplies of such foodstuff would be maintained nor its equitable distribution and availability at fair price secured. The learned counsel accordingly urged that the key words with reference to fixing of prices under section 3 of the said Act are "fair price" and that in order that a price should be fair, it must be fair both to the buyer and to the seller, and it could only be fair to the seller if it gave him a reasonable margin of profit. He conceded that under special circumstances Government may fix the prices of certain essential foodstuffs at below even their cost, but in such cases either the seller is the Government itself, which bears the loss, or the Government provides a subsidy or subvention to the seller who thus gets a fair equivalent for what he sells. In the case of London and Yorkshire Bank v. Belton (15 Q B D 457). Coleridge, C. J. while considering the connotation of the term "fair price" with reference to section 45 of the Agricultural Holding Act, 1883, interpreted the expression to mean "that a man gave a fair equivalent for what he got." In the case of a dealer in foodstuffs, fair equivalent, in our opinion, would imply a reasonable margin of profit to the dealer.

8. It was not disputed by the learned Assistant Advocate‑General that the expression `fair price', as used in section 3 of the said Act, includes reasonable profit to the seller, and that this element has to be taken into consideration in fixing the price of any foodstuff. His contention, however, was that this element had in fact been considered while issuing the impugned D notification. We have, while dealing with the first submission of Mr. Khalid Ishaq, referred to the summary submitted to the Economic Committee of the Cabinet, which specifically provided for a margin of profit of eight annas per seer to the dealers in meat. However, the prices fixed in the impugned notification were even higher than those recommended and hence the meat dealers should normalcy have realized, at the time that the impugned notification was issued, even higher profits than those envisaged in the summary, assuming of course that the data or the basis whereof the cost structure of meat was worked out in the summary were accurate and all the factors relevant to the cost structure had been taken into account. Mr. Khalid Ishaq, however, contended that not only the data on which tire summary was based were inaccurate but further all the relevant factors had not been taken into consideration. He was, however, unable to point out in what manner the data were inaccurate and merely asserted that the prices as animals and other charges specified in the charts appended to the summary, showing the cost structure of meat, were much lower than the actual prices and the charges which the meat dealers had to pay. We are, therefore, unable to find any force in this part of his contention and repel the same.

9. We equally find no force in the second part of his contention that the factors and considerations relevant to the cost structure of meat had not been taken into account while issuing the impugned notification. We have already referred to the various studies carried out by Government to ascertain the cost structure of meat and made mention of what appear to us to be the more important factors which have been taken into account in working out the cost structure. In our opinion, these are not only relevant factors but would appear by and large to cover the various considerations which the petitioner himself in his petition has urged should be taken into account in fixing the prices of meat.

10. It was next contended by Mr. Khalid Ishaq that there has been excessive delegation to respondent No. 2, in that whereas the power to make orders under section 3 of the said Act could validly be delegated to him, the antecedent function of considering whether it is necessary to make such an order cannot be delegated under section 4 of the said Act. The submission of the learned counsel was that the Government, whether on a reference from respondent No. 2 or otherwise on the basis of material made available to it, has first to consider and decide that it is necessary, for any of the purposes specified in section 3, to make an order under that section, and only after it has so considered and decided, could respondent No. 2, in exercise of his delegated power, issue the impugned notification. The contention superficially is attractive and finds support from a decision of this Court in the case of Liaqat Ali v. Government of Sind (P L D 1973 Kar. 78). That was a case under the West Pakistan Maintenance of Public Order Ordinance, 1960. Section 3 of that Ordinance empowers the Government to direct the detention of a person if it is satisfied that it is necessary to do so with a view to preventing such person from action in a manner prejudicial to public safety or public order. Section 26 of the Ordinance empowers the Government to delegate its powers under section

3. In exercise of that power, Government has delegated to the District Magistrates the powers under section 3 of the Ordinance to direct detention for a limited period. It was held in the reported case that despite such delegation, it would still be necessary for the District Magistrate to make a reference to Government with regard to the prejudicial activities of a citizen, for what can be delegated under section 26 of the Ordinance is only the power to arrest and detain a citizen, but not the faculty of satisfaction as to the necessity of ordering the detention. It appears that the attention of the learned Bench which decided that matter was not invited to the Full Bench decision of the defunct High Court of West Pakistan in the case of Nasim Fatima v. Government of West Pakistan (P L D 1967 Lah. 103). The case inter alia involved the question of the powers of detention under rule 32 (1) (b) of the Defence of Pakistan Rules delegated to the Provincial Government. It was contended before the Full Bench that since under rule 32 (1) (b) the power to order detention is to be exercised by the Central Government, "if satisfied", no other authority has power to make an order under this rule, because satisfaction is of the Central Government and has not been delegated. Repelling this argument, the Full Bench, on the basis of the authorities referred to in its decision, held : "The delegation of the power to make an order under rule 32 (1) (b) carries with it the power and the capacity to be satisfied as to the necessity for the order to be made". On appeal, their Lordships of the Supreme Court in their decision reported in P L D 1967 S C 373, upheld this view and Cornelius, C. J. (as he then was), observed as follows :‑ "Next, the question was raised before the High Court that the faculty of satisfaction under section 3 (2) (s) of the Ordinance was not susceptible of delegation. The learned Judges rejected this argument on the basis that power given by law in conditional form carries also with it the determination of specified conditions. There is an appreci able volume of authority in the precedent law of the sub‑continent as well as of Pakistan in favour of this view."

11. Mr. Khalid Ishaq attempted to distinguish the case under report on the ground that the Supreme Court really based its decision on the wording of section 3 (4) of the Defence of Pakistan Ordinance, which laid down that the Central Government may by order direct that "any power or duty which by rules under subsection (1) is conferred or imposed upon the Central Government" shall be exercised Inter alia by the Provincial Government, and that the Supreme Court took the view that "satisfaction" involved the exercise of judgment in relation to a number of factors and hence was a duty, which function could be delegated. This, however, was an additional reason why their Lordships repelled the contention that the power of satisfaction could not be delegated, and hence the other reason which found favour with their Lordships, and which we have reproduced in the preceding para., cannot be ignored. On the basis of the above decision of their Lordships of the Supreme Court, we would hold that the power of Government delegated to respondent No. 2 to make an order under section 3 carries with it the power of determining whether the necessary conditions existed for' making such an order.

12. It was finally contended by Mr. Khalid Ishaq that even if it be held that at the time that the impugned notification was issued it was in accordance with the requirements of section 3 of the said Act, the study carried out by the Government itself in October 1975, disclosed that the prices of animals and the other charges on the basis of which the prices of meat were fixed in the impugned notification had risen considerably since then, and therefore, the prices in the impugned notification could no longer be considered "fair prices" and the notification should accordingly be held to have become inconsistent with the provisions of section 3 of the said Act from the date o such study. A perusal of the said study shows that the net cost of mutton bad escalated to Rs. 11.75 per seer and that of beef to Rs. 5.30 per seer. We are inclined to agree with this submission of the learned counsel. As already stated, in our view, section 3 of the said Act envisages the fixing not merely of prices, but "fair prices". If, therefore, the prices fixed under the said section are shown to have ceased to be "fair prices", they would no longer be in accord with the provisions of that section and would in fact be violative thereof. The learned Assistant Advocate‑General, while conceding that in October 1975, the cost of both beef and mutton had considerably escalated over what it was at the time that the impugned notification was issued and further stating that as a result of rising cost of mutton Government was contemplating to fix revised prices of meat, submitted that what the Court bad to consider was the position as it obtained in February 1975, when this petition was filed, and not any thing which occurred subsequently. The learned Assistant Advocate‑General submitted that if the petitioner wants to rely on the prices of meat as disclosed in the study of October 1975, he should file a fresh petition. We are unable to agree with this submission. Since the respondents themselves have filed with their counter‑affidavit the result of their study carried out in October 1975, the same cannot be ignored by the Court and has to be taken into consideration.

13. In the result we hold that the impugned notification ceased to be in accord with the provisions of section 3 of the said Act and therefore cased to have any validity with effect from October 1975, when the stud carried out by respondent No. 1 itself showed that the cost structure on the basis of which the prices of meat had been fixed in the impugned notification had appreciably escalated and the prices so fixed had clearly ceased to be "fair prices". Since the petitioner has had only partial success, there will no order as to costs. S. A. H. Petition partly accepted.