MAHABIR BEOPAR MANDAL LTD v. FORWARD MARKET COMMISSION

Case Details & Bench

Court: High Court
Hon'ble Judges: A. N. Ray
M. H. Beg
Judgment Date: 1977-01-13
Court Decision / Holding: Appeals dismissed.
Final Disposition: Appeals dismissed.

Parties to the Case

Appellants / Petitioners

Mahabir Beopar Mandal Ltd

Respondents

Forward Market Commission

Legal Representation & Advocates

Counsels for Petitioners

• A. N. Parekh
• Yogeshwar Prasad
• D. N. Misra

Counsels for Respondents

• L. N. Sinha
• S. N. Prasad
• Girish Chandra

Case Synopsis & Summary

These appeals concern whether the Forward Market Commission (FMC) under the Forward Contract (Regulation) Act, 1952, can impose conditions under sections 14A and 14B on the commodities in respect of which registration is sought. The appellants contended that the FMC lacks power to prescribe commodity specifications as a condition of registration and that section 4 does not authorize the imposition of such conditions; they also argued that for recognised associations the Commission had no power to regulate the commodities in which they deal. The case was framed by a reference to the Union of India v Mis Rajdhani Grains and Jaggery Exchange Ltd. (1975 Supp SCR 1), where this Court had previously dealt with similar questions. The Court reaffirmed that the specification of commodities eligible for forward contracting is a regulation-related condition and that the Commission is empowered to impose such conditions in granting registrations. It rejected the argument that section 4 strips the Commission of this power, and held that sections 15–18 do not conflict with the Commission’s authority; Chapter III-A governs the registration process for associations involved in forward markets. Following these rulings, the appeals were dismissed with no order as to costs. The decision thus consolidates the regulatory framework for forward-contract activities under the 1952 Act.

Provisions of Law Cited

Forward Contract (Regulation) Act, 1952, Sec. 14AForward Contract (Regulation) Act, 1952, Sec. 14BForward Contract (Regulation) Act, 1952, Sec. 4Forward Contract (Regulation) Act, 1952, Secs. 15-18Chapter III-A

Submissions & Arguments

Contentions of Appellants / Petitioners

The appellants contended that the Forward Market Commission under the Forward Contract (Regulation) Act, 1952 cannot impose conditions under sections 14A and 14B on the commodities in respect of which business can be carried out by persons who apply for registration. Secondly, the provisions contained in s. 4 of the Act do not confer power on the Commission to impose conditions. Thirdly, in respect of recognised associations, the Commission had no power to impose conditions with regard to commodities in which they deal.

Contentions of Respondents

The respondents argue that the Commission has the power to impose conditions under sections 14A and 14B, that Section 4 confers power to impose conditions, and that there is power to impose conditions for recognised associations; these contentions are supported by the decision of the Court (supra) and by the arguments leading to the Commission's authority.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
Union of India v Mis Rajdhani Grains and Jaggery Exchange Ltd. & Ors.	1975 Supp. SCR 1	Positive	Cited as controlling authority establishing that commodity specification is a condition under regulation and that the Commission has power to impose conditions.

Extracted Judgment Text

Exact text extracted from official judgment records.

A B # c D E F G H 604 MAHABIR BEOPAR MANDAL LTD _v._ FORWARD MARKET COMMISSION _January_ 13, 1977 [A. N. RAY, C.J. AND M. H. BEG, J.] _Forward_ _Cr-111ract_ _(Regulation)_ _Act_ 1952-Secs. _14A,_ _14B- Forward_ _Market_ _Commission-Power_ _to impose conditions._ The appellants contended that the Forward Market Commission under the· Forward Contract (Regulation) Act 1952 cannot impose conditions under sections 14A and 14B on the commodities in respect of which business can be carried out by persons who apply for registration. Secondly, the provisions. contained in s. 4 of the Act do not confer power on the Commission to impose· conditions. Thirdly, in respect of recognised associations, the Commission bad' no power to impose conditions with regard to commodities in which they deal. Dismissing the appeal, HELD : All the 3 conditions raised in the present appeal are covered' against the appellant by the decision of this Court in the case of _Union_ _of_ _India_ v. _Mis_ _Rajdhani Grain and laggery Exchange Ltd._ reported in [19751 Supp, SCR 1. [605 B-F] CIVIL APPELLATE JURISDICTION : Civil Appeal No. 873 of 1975 .. (From the Judgment and Order dated 11-11-1974 of the Allahabad High Court in Civil Misc. Writ Petition No. 6976/74) AND Civil Appeal No. 1748 of 1975. (Appeal by Special Leave from the Judgment and Order dated 8-11-1974 of the Allahabad High Court in Civil Misc. Writ Petition No. 6932/74). AND Civil Appeal No. 1425 of 1974. (From the Judgment and Order dated 1-9-1972 of the Allahabad High Court in Special Appeal No. 8/66). _A._ _N. Parekh,_ for the appellants in CA 1748/75. _Yogeshwar Prasad,_ for the appellants in CA 873/75. _D. N. Misra_ for the appellant in CA 1425/74. _L._ _N. Sinha, Solicitor General,_ S. _N. Prasad_ (In CA 873/75) and: _Girish Chandra,_ for the respondents in all the appeals. The Judgment of the Court was delivered.by RAY, C.J. Civil Appeals Nos. 873 and 1425 are- by certificate under Article 133 (1) of the Constitution of India and Civil Appeal No. 1748 is by special leave. MAHABIR BEOPAR MANDAL _V._ FORWARD MARKET COMMISSION 605 _(Ray,_ _C.J.)_ These appeals turn on the question whether the Commission described as the Forward Market Commission under the Forward Contract (Regulation) Act, 1952, can impose conditions under section 14-A and Section 14-B on the commodities in respect of which business can be carried on by persons who apply for registration. **A** _I_ _>_ This Court in _Union_ _of_ _India_ & _Anr._ v. _Mis._ _Rajdhani Grains_ _and_ _Jaggery Exchange Ltd._ & _Ors._ (1975 Supp. S.C.R. l) dealt with **B** this specific question and came to the conclusion that the specification of the commodities in respect of which the business can be ·carried on is a condition concerned with the regulation and control of the business relating to forward contracts. It is idle to suggest that the Commission in granting certificate of registration to carry on business will not be competent to specify the commodities in which the persons asking for registration wi11 deal. **C** Another contention was raised before us that the .provisions contained in Section 4 of the Forward Contract (Regulation) Act 1952 do not confer power on the Commission to impose conditions. This contention is also repelled by the decision of this Court to which reference has ·already been made. It has been held in that case that the Commission alone is vested with power to impose conditions in regard D to commodities in respect of which forward contracts can be entered into by a particular association. Sections 15 to 18 of the Act do not clash with the power of the Commission to impose conditions in respect of commodities in which business of forward contract can be carried on. Another contention was advanced before us that with regard to the **E** recognised associations the Commission had no power to impose conditions with regard to commodities in which they deal. This contention is also answered by the decision of this Court (supra). Further the provisions contained in Chapter III-A specifically deal with registration of all associations concerned with regulation and control of forward contracts and the power of the Commission to grant or refuse such certificate of registration. **F** All contentions advanced by the appellants are already answered by the decision of this Court (supra) and the observations made herein. The appeals are .therefore dismissed, There will be no order as to, costs. **P.H.P.** _Appeals dismissed._