Punjab: High Court sees officials' role in paddy allotment to defaulter company

Saurabh Malik

Chandigarh, September 17

In a significant judgment, the Punjab and Haryana High Court has asserted that seemingly there was active connivance of officials of the FCI and Punjab Food, Civil Supplies and Consumer Affairs. The assertion came in a case where the officials had allotted paddy from 1995-96 to 2021-22 to a defaulter unit despite specific provision in a policy before suddenly waking up from slumber and denying the same.

“This is not the first case and this court has come across with many cases where FCI and state agencies have taken similar action after more than a decade, Justice Jagmohan Bansal asserted. Describing the case in hand as “a classical case of misuse of official position and abuse of process of law”, the Bench also directed the FCI Managing Director to take action against its erring officials. Similar directions were also issued to the Punjab Director, Food, Civil Supplies and Consumer Affairs. For the purpose of doing the needful, the Bench set a three-month deadline.

The matter was brought to the high court’s notice after a rice mill filed a petition seeking setting aside of an order dated December 20, 2022, whereby the state and other respondents denied allotting paddy to the petitioner on the ground that he fell within the definition of ‘defaulter’ contemplated by custom milling policy.

After going through the relevant documents and hearing rival contentions, Justice Bansal asserted that paragraph seven in the policy envisaged the status of a defaulter and enjoined that paddy would not be allotted to a defaulter.

It was “quite evident” that the petitioner fell within the definition of defaulter and he was not entitled to allotment of paddy. “The case of the petitioner squarely falls within four corners of paragraph seven of the policy. Thus, the petitioner cannot be allotted paddy till declared a non-defaulter”, Justice Bansal observed.

Justice Bansal asserted that the petitioner was a partnership firm. The wife of one partner was a partner in both firms. The petitioner company was the lessor and the other firm lessee. Virtually, the lessor and lessee were same. As per the custom milling policy, the lessor was supposed to furnish undertaking to the effect that the lessor would be responsible in case of default by the lessee.