“SB Civil Writ Petition No. 369/2016 titled as Alwar Malt and Agro Foods VS State of Rajasthan” and other connected matters decided on 11/03/2019 this Hon’ble court pleased to remand back the matter. The operative portion of order/ judgment is produced here under for ready reference:-
In the case of P. Ratnakar Rao & Ors. Vs. Government of A.P. & Ors. (spura), Hon’ble the Supreme Court has held as under:
Point No:- 10 “The contention raised before the High Court and repeated before us by Shri Rajeev Dhavan, learned senior counsel for the petitioners is that the discretion given in Section 200 [1] of the Act is unguided, (23 of 25) [CW-369/2016] uncanalised and arbitrary. Until an accused is convicted under Section 194, the right to levy penalty thereunder would not arise. When discretion is given to the court for compounding of the offence for the amount mentioned under Section 200, it cannot be stratified by specified amount.
Article 14 Equality before law:- The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India Prohibition of discrimination on grounds of religion, race, caste, sex or place of birth
It would, therefore, be clear that the exercise of power to prescribe maximum rates for compounding the offence is illegal, arbitrary and violative of Article 14 of the Constitution. We find no force in the contention. For violation of Sections 113 to 115, Section 194 accords penal sanction and on conviction for violation thereof, the Section sanctions punishment with fine as has been enumerated hereinbefore. Section would give guidance to the State Government as a delegate under the statute to specify the amount for compounding the offences enumerated under sub-section [1] of Section 200.
It is not mandatory that the authorized officer would always compound the offence. It is conditional upon the willingness of the accused to have the offences compounded. It may also be done before the institution of the prosecution case. In the event of the petitioner’s willing to have the offence compounded, the authorized officer gets jurisdiction and authority to compound the offence and call upon the accused to pay the same. On compliance thereof, the proceedings, if already instituted, would be closed or no further proceedings shall be initiated.
It is a matter of volition or willingness on the part of the accused either to accept compounding of the offence or to face the prosecution in the appropriate court. As regards canalization and prescription of the amount of fine for the offences committed Section 194, the penal and charging section prescribes the maximum outer limit within which the compounding fee would be prescribed. The discretion exercised by the delegated legislation, i.e., the executive is controlled by the (24 of 25) [CW-369/2016] specification in the Act.
JT 1996 (6), 624 1996 SCALE (5)38
In the case of P. Ratnakar Rao & Ors. Vs. Government of A.P. & Ors. (spura), Hon’ble the Supreme Court has held as under: –
The contention raised before the High Court and repeated before us by Shri Rajeev Dhavan, learned senior counsel for the petitioners is that the discretion given in Section 200 [1] of the Act is unguided, uncanalised and arbitrary. Until an accused is convicted under Section 194, the right to levy penalty thereunder would not arise. When discretion is given to the court for compounding of the offence for the amount mentioned under Section 200, it cannot be stratified by specified amount. It would, therefore, be clear that the exercise of power to prescribe maximum rates for compounding the offence is illegal, arbitrary and violative of Article 14 of the Constitution. –Violative of Article 14 of the Constitution.
We find no force in the contention. For violation of Sections 113 to 115, Section 194 accords penal sanction and on conviction for violation thereof, the Section sanctions punishment with fine as has been enumerated hereinbefore. Section would give guidance to the State Government as a delegate under the statute to specify the amount for compounding the offences enumerated under sub-section [1] of Section 200.
It is not mandatory that the authorized officer would always compound the offence. It is conditional upon the willingness of the accused to have the offences compounded. It may also be done before the institution of the prosecution case. In the event of the petitioner’s willing to have the offence compounded, the authorized officer gets jurisdiction and authority to compound the offence and call upon the accused to pay the same. On compliance thereof, the proceedings, if already instituted, would be closed or no further proceedings shall be initiated.
It is a matter of volition or willingness on the part of the accused either to accept compounding of the offence or to face the prosecution in the appropriate court. As regards canalization and prescription of the amount of fine for the offences committed Section 194, the penal and charging section prescribes the maximum outer limit within which the compounding fee would be prescribed.
The discretion exercised by the delegated legislation, i.e., the executive is controlled by the specification in the Act. It is not necessary that Section 200 itself should contain the details in that behalf. So long as the compounding fee does not exceed the fine prescribed by penal section, the same cannot be declared to be either exorbitant or irrational or bereft of guidance.
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