Yeasin Molla And Ors vs. Union Of INDIA And Ors.

Facts

The petitioners, ration card holders and members of Priority Household under the National Food Security Act, 2015, filed a writ petition in a representative capacity on behalf of all ration card holders in West Bengal. They challenged the rising price of kerosene oil distributed under the Public Distribution System (PDS). The petitioners argued that the Central Government, under the Kerosene (Restriction on Use and Fixation of Ceiling Price) Order, 1993, has a statutory obligation to declare a "declared price" for PDS kerosene. However, this duty has allegedly been delegated to Oil Marketing Companies, who fix prices based on import parity pricing, leading to unaffordable costs for the poor. The petitioners highlighted that the subsidy on PDS kerosene was abolished in 2020-21, and despite schemes like Ujjala, many still rely on kerosene due to the high cost of LPG refills.

Held

The Court held that the writ petition is maintainable in its present form. It affirmed that the Central Government has a statutory obligation under Clause 2(d) of the Kerosene (Restriction on Use and Fixation of Ceiling Price) Order, 1993, to declare the price of PDS kerosene. The Court found that this power cannot be delegated to oil companies, as the PDS is based on the principle of a welfare state, which mandates the government to ensure essential commodities are accessible to the poor. The Court acknowledged that fixing the subsidized price of kerosene oil involves a policy decision requiring joint consideration by the Department of Finance and the Department of Petroleum and Natural Gas, Government of India. Therefore, the Court cannot fix the selling price itself. The Court directed the Central Government to adopt and take a policy decision for fixing the rate of subsidized price of kerosene oil for consumers. Additionally, the State Government was directed to impose minimum rates of taxes, cess, and other duties to help fix the selling price of kerosene for the poorest citizens.

Key Issues

1. Whether the writ petition, filed by ration card holders in a representative capacity, is maintainable as a public interest litigation or otherwise, concerning the fixation of prices for essential commodities under the Public Distribution System. 2. Whether the Central Government has a statutory obligation under the Kerosene (Restriction on Use and Fixation of Ceiling Price) Order, 1993, to declare a "declared price" for PDS kerosene, and if so, whether this obligation can be delegated to Oil Marketing Companies. Petitioner's Arguments: The petitioners contended that the writ petition is maintainable as it seeks to protect the interests of a vulnerable section of society and vindicate the Rule of Law. They argued that the Central Government has a statutory duty under Clause 2(d) of the 1993 Control Order to declare the price of PDS kerosene, and this power cannot be delegated to oil companies. They asserted that the current practice of oil companies fixing prices based on import parity pricing, without a government-declared subsidized price, violates the principle of a welfare state and the objective of the PDS. Revenue/State's Arguments: The judgment does not explicitly record arguments made by the respondents regarding the maintainability of the petition or the delegation of price-fixing authority. However, it notes the submission from the Union of India that the price of PDS kerosene is fixed on the element and methodology of import parity pricing, which depends on international market prices, ocean freights, and inland freights, along with customs duty.