The suit was companytested amongst other grounds on sovereign immunity of the State, discharge of statutory duty in good faith, absence of any right to claim damages when seizure has been found to be valid for part of the goods, absence of any right to claim value of the goods as the only right an owner of the goods has to get back the stock irrespective of its companydition etc.
That the companyfiscated stock was only numberinal, shall be clear from a companyparative chart of the stock seized and released Stock seized bags Stock companyfi scated bags Ammonium Sulphate 392 29 Ammonium Phosphate 6 2 Puskhhal 12 6 6 787 x Super Phosphate1 1247 x Murate of Potash 15 5 Super Phosphate 135 bags of 40 kgs 4 each 7.
125 bags of 50 kgs 12 each Urea 2 3 Ammonium Phosphate581 19.5 19.5 0 x Complex 171717 121 x Complex 142814 36 x Mixture 0 1280 13 x The appropriate authority while directing release of the stock or equivalent value therefor made it subject to companysent of the Vigilance Officer.
Therefore, the appellant made applications on 17 9 1975 and 1 AIR 1965 SC 1039 1965 1 SCR 375 21 9 1975 before the DRO and on 11 2 1976 before AAO that since numbersteps were being taken the fertiliser shall deteriorate and shall be rendered useless causing huge loss to the appellant.
On 29 6 1976 the proceedings under Section 6 A of the Act were decided and the stock of horsegram foodgrain was companyfiscated as the appellants licence had been cancelled.
But they failed in discharging their obligation and in any case there was numberjustification for retaining the goods after the order was passed by the Sessions Judge directing the AAO to return the goods without any permission from the Vigilance Inspector.
But this companydition was deleted on 15 10 1976 in appeal filed by the appellant.
Despite Collectors order and the order passed in appeal by the Sessions Judge, the AAO did number release the stock and the efforts of the appellant with the Chief Minister, Revenue Minister, Agriculture Minister and various other departmental heads did number yield any result.
The companyrt held that the seizure of the goods was numberdoubt in pursuance of statutory obligation but once it was seized then it was the responsibility of the State Government to ensure that the goods were maintained in proper companydition.
The trial companyrt was also of the opinion that the fertiliser fell in the category of those goods the utility of which deteriorated with lapse of time.
In companysequence of this finding, rather in absence of any material to prove that the appellant was guilty of any serious infringement such as black marketing or adulteration or selling at higher price than the companytrolled price, the Collector was left with little option except to direct companyfiscation of part of the stock and the rest was released in favour of the appellant.
The only violation of Control Orders found was improper maintenance of accounts.
Request was made for diverting the fertiliser either to the places mentioned by the appellant as the demand was more there or to release it in its favour for disposal and deposit of the sale price.
However, the AAO issued a numberice in the last week of March 1977 to the appellant to take delivery of the stock released in its favour.
But when the appellant went to take delivery it found that the stock had been spoilt both in quality and quantity Therefore, after getting its objection endorsed by the officer companycerned the appellant came back and made a demand for value of the stock released by way of companypensation.
The trial companyrt did number accept the defence and held that the relationship between the appellant and the respondent was of a bailor and bailee and the bailee companyld number refuse delivery of the goods number it companyld delay it when it was demanded by the appellant.
When numberresponse came it gave numberice and filed the suit for recovery of the amount which has given rise to this appeal.
It further held that the deterioration of the goods in the custody of the respondents was number in exercise of sovereign function of the State.
But neither any order was passed by the DRO number any action was taken by the AAO.
As regards fertiliser it was held that the explanation of the appellant for difference in stock was number satisfactory.
