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The State of Maharashtra & Ors. v. Maharashtra Hybrid Seeds Co. Pvt. Ltd.

Civil Appeal · 2019 INSC 945Decided 22 Aug 2019
Civil Appeal No. 6564 of 2019
Justice R. Banumathi · Justice A.S. Bopanna

Background

Maharashtra Hybrid Seeds Co., licensed to process and sell hybrid seeds, stored a large, unsegregated stock of genetically modified cotton seed at its Dhanora godown without furnishing licence details or stock information to inspecting Seed Inspectors despite repeated requests. The State authorities sealed the godown in December 2017 for alleged licence violations. The Bombay High Court (Nagpur Bench) allowed the company's writ petition, ordering the godowns de-sealed, on the view that no licence was needed for mere storage and that Seed Inspectors had no power to seal premises under the Seeds Act. The State appealed to the Supreme Court.

Decision Breakdown

The Supreme Court held that although the Seeds Act, 1966 does not expressly mention a power to "seal" premises, Section 14(1)(e)'s residual power to "exercise such other powers as may be necessary for carrying out the purposes of the Act" implicitly empowers a Seed Inspector to seal premises in rare, exceptional cases of serious non-compliance, subject to safeguards, including recording reasons and reporting to the Magistrate and superior officers. On the facts, the company's failure to provide licence proof or properly segregated stock details justified the sealing, so it was not arbitrary. The Court therefore set aside the High Court's contrary findings and allowed the State's appeal (while noting the godown had already been de-sealed pursuant to the earlier High Court order, so no further direction on that point was needed).

Lesson Learnt

Regulatory inspectors can possess implied enforcement powers (like sealing premises) flowing from a statute's general "residual powers" clause even where not expressly spelled out, but such drastic powers must be used only in rare/exceptional circumstances with documented reasons and proper reporting: businesses holding regulated licences must be prepared to promptly furnish licence and stock records to inspecting authorities.

Official source (sci.gov.in)View Judgment (PDF)

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