U.P. ROLLER FLOUR MILLS ASSOCIATION AND ORS.versusGOVT. OF INDIA AND ORS.

        U.P. ROLLER FLOUR MILLS ASSOCIATION AND ORS.                        A
                              v.
                   GOVT. OF INDIA AND ORS.

                            OCTOBER 5, 2007
                                                                            B
          {DR. ARIJIT PASAYAT AND P. SATHASIVAM, JJ.)
J
         Constitution ofIndia, 1950-Article 32-Allocation ofsubsidized
    wheat stocks by Government of India through Public Distribution C
    System-State of West Bengal and Assam diverting the same to open
    market on subsidized rates instead ofintended beneficiaries, causing
    loss of several crores-Writ Petition before Supreme Court-Held:
    Directions issued to the concernedAssociations/Gram Panchayats/
    Local bodies to assess the need of wheat/atta for the intended
    beneficiaries which would be conveyed to the State Government who D
    would then supply it to the Fair Price Shop to be finally supplied to .
    the consumer.

         The instant writ petition has been filed to highlight that the State
    of West Bengal and North-East States are diverting highly subsidized E
    wheat stocks supplied by the Central Government for distributicm
    through Public Distribution System under several schemes, to rolling
    flour mills of different States depriving the needy consumers and the
    intended beneficiaries and causing loss of several crores to the public
    exchequer.                                                                F

         Different states refuted the allegations. However, the Government
    of Assam was directed to work out the modalities to ensure that the
    beneficiaries are not affected. The Government of Assam found that
    the beneficiaries were not interested in taking the whole grain and G
    instead wanted Atta and wanted continuation of milling Above Poverty
    Line into wholemill Atta for distribution through PDS.

         Disposing of the writ petition, the Court
                                      569                                    H
    570           SUPREME COURT REPORTS                     (2007] 10 S.C.R.
                                                                                  t
A        HELD: Considering the intention behind the programme, the
    following modalities are directed to be adopted:
        (1) The concerned Associations/Gram Panchayats/Local bodies
  shall assess the need ofwheat for the intended beneficiaries. The need
B shall be indicated to the State Government.
         (2) They shall indicate the quantum ofwheat which is to be converted
    into Atta to be given to the beneficiaries on the basis of their option. On       \.
    the basis of such intimation, Associations/Gram Panchayats/Local
    bodies shall convey the requirement to the State Government.
c
          (3) The quantity indicated for conversion into Atta shall be given
    to the Mills, who after converting wheat into Atta, shall supply it to the
    Fair Price Shop so that the intended beneficiaries can get them from
    the FPS at rates fixed by the concerned Governments.
D          ~

          (4) The State Governments shall ensure that the actual requirement
    is being projected by the Associations/Gram Panchayats/Local bodies                \

    and similarly whether after milling the supply is made to the FPS to be
    supplied finally to the consumer.
E         (5) The State Governments shall quarterly submit the necessary
    data for the information of the Central Government who shall also
    ensure that all possible steps are being taken by the State Governments
    to fulfil the intended objectiv.es. [Para 7] [572-F, G; 573-A, B, C, D]
F       CIVIL ORIGINAL ruRISDICTION : Writ Petition (Civil) No. 274
    of2005.
          (Under Alticle 32 of the Constitution oflndia).
          Dinesh Kumar Garg and V.K. Biju for the Petitioners.
G        M.L. Lahoty, Paban K. Sharma and Himanshu Shekhar for the
    Applicant.
       C.A. Sundaram, Riku Sharma, (for Mis. Corporate Law Group),
  Tara Chandra Sharma, Neelam Sharma, Rajeev Sharma, Kishan Datta,
H G. Prakash, Sunil Roy, R.C. Kathiaand V.K. Verma for the Respondents.
 U.P. ROLLER FLOUR MILLS ASSOCIATION v. GOVT.                         571
              OF INDIA [PASAYAT, J.]

     The Judgment of the Court was delivered by ·                           A

      DR. ARIJIT PASAYAT, J. L In this petition under Article 32 of
the Constitution of India, 1950 (in short the 'Constitution') the petitioners
have highlighted that that there has been alarming increase in diversion of
food stocks meant to be supplied under the Public Distribution System B
(in short 'PDS'). It is stated that highly subsidized wheat stocks supplied
by the Central Government for distribution through PDS under several
schemes are being diverted to rolling flour mills of different States. These
stocks have been procured b)L the Central Government from Food
Corporation oflndia (in short 'FCI'). Special reference has been made c
to the State of West Bengal and North-East States. It is alleged that
instead of supplying them to the needy consumers and the intended
beneficiaries they are being diverted to the open market. Several statistical
data have been furnished. The States of Assam and West Bengal have
filed counter affidavits and have denied the allegations and have submitted D
that all possible measures have been adopted to ensure that the foodgrains
reach the intended beneficiaries.
     2. Learned counsel for the petitioners have referred to some
newspaper reports indicating that foodgrains wo1th more than rupees thirty
one thousand crores have been siphoned off from public distribution E
system.
      3. These allegations have been refuted by the learned counsel for
the different States. It is to be noted that the Government of India, Ministiy
of Food and Consun1er Affairs, Department of Food and Civil Supplies, F
by letter dated 13th December, 1997 brought to the notice of the Food
Secretaries of all State Governments and Union Temtories Administration
that the scheme of custom milling was extended for a period of one year
upto 31.10.1997 on the express conditions stipulated by letter dated 4th
November, 1996. It was stated that the scheme was further reviewed G
and it was decided not to extend it further. The scheme of custom milling
of PDS wheat stood withdrawn/discontinued.

     4. The Government of Assan1, it is urged by learned counsel for the
State, took follow up action on the basis of the aforesaid letter. A writ
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    572            SUPREME COURT REPORTS                    [2007] 10 S~C.R.


A petition was filed before the Gauhati High Court questioning the action
  taken by the Assam Government in terms of aforesaid letter of the
  Government of India. The impugned annexures were quashed by a learned
  Single Judge. The matter was carried in writ appeals before the Division
  Bench which set aside the orders of the learned Single Judge. However,
B direction was given to work out the modalities to ensure that the
  beneficiaries are not affected.
        5. It appears that the Government of Assam found that the
  beneficiaries were not interested in taking the whole grain and instead
C wanted Atta This aspect was also examined by the Central Government.
  It was noted that the workers in the tea gardens had shown reluctance to
  take whole grain and instead preferred Atta. The Government of India
  also took note of the request of the Assam Government for continuation
  of milling Above Poverty Line (in short 'APL') into wholemill Atta for
D distribution through PDS. It was suggested by learned counsel for the
  Government of Assam that the distribution can be made through Gram
  Panchayats who in turn can get the wheat converted into Atta for supply
  to the beneficiaries.
         6. Learned counsel for the petitioners on the other hand submitted
E that it would .not be desirable to adopt such a course as there is possibility
  of manipulations and lack of accountability. It is undisputed that the
  distribution under the PDS is done through the Fair Price Shops (in short
  'FPS').
F        7. Considering the intention behind the programme, we direct
    following modalities to be adopted:
           ( 1) The concerned Associations/Gram Panchayats/Local bodies
                shall assess the need of wheat for the intended beneficiaries.
                The need shall be indicated to the State Government.
G
           (2) They shall indicate the quantum of wheat which is to be
               converted into Atta to be given to the beneficiaries on the basis
               of their option. In other words, those beneficiaries who want
               to take wheat shall indicate to them and those who want to
               take Atta shall similarly indicate their option. On the basis of
H
I
     U.P. ROLLER FLOUR MILLS ASSOCIATION v. GOVT. 573
                  OF INDIA [PASAYAT, J.]

                such i?timat!on as noted above, Associations/Gram A
                Panchayats/Local bodies shall convey the requirement to the
                State Government.
            (3) The quantity indicated for conversion into Atta shall be given
                to the Mills, who after conv~g wheat into Atta, shall supply B
                it to the FPS so that the intended beneficiaries can get them
                from the FPS at rates fixed by the concerned governments.
            (4) The State Governments shal'i ensure that the actual requirement
                is being projected by the Associations/Gram Panchayats/Local
                bodies and similarly whether after milling the supply is made C
                to the FPS to be supplied finally to the consumer.
            (5) The State Governments shall quarterly submit the necessruy
                data for the information of the Central Government who shall
                also ensure that all possible steps are being taken by the State D
                Governments to fulfil the intended objectives.
           8. The writ petition is accordingly disposed of.
    N.J.                                            Writ Petition disposed of.