'Let No One Die Of Hunger': Allahabad HC Quashes UP Govt Order Providing Preference To Self-Help Groups In Allotment Of Fair Price Shops

A Single Bench of Justice Attau Rahman Masoodi held that the impugned GO seeks to create a "monopoly" in favour of the Self-help Groups that generally have a "weak legal identity" for the purposes of fixing accountability and thus, any such body is susceptible to "worsen" the objects of Public Distribution System instead of bringing about any reform.

It observed that the rural population has already suffered much on account of non-supply of food grains leading to food scams. It thus opined that preference of a self-help groups, which it dubbed as "loosely packed" institutions, in allotment of fair price shops, would be "counterproductive" and shall not serve the real purpose.

"The State Government has not projected any clarity in the matter of Self-help groups except that they are granted a unique identity number by some agency known as 'National Rural Livelihood Development Mission'.

Mere allotment of a unique ID by National Rural Livelihood Development Mission for the purposes of grant of licence to run a fair price shop on behalf of the State is not enough.

Registration of Self-help groups and their functioning under well defined aims, objects and bye-laws coupled with the criteria of credibility are the relevant dimensions to fix accountability," the High Court opined.

It clarified that its observations do not intend to suggest that the Self-help Groups are ineligible but, what the law aims at is an accountable Self-help Group that has a legal existence in the eye of law, i.e., a body, which can sue and be sued besides 27 having a functional identity above that of an individual.

Accountability of Self-Help Groups

The High Court noted that for the purpose of preference to public institutions or public bodies, as contemplated under Section 12 of the National Food Security Act,  Self-Help groups need to qualify as 'legal entities'. It held that Self-help Groups, whose identity for want of registration or any such foundation is doubtful, cannot be termed as juristic persons within the meaning of public bodies or public institutions.

"This Court may note that incentive payable to the fair price shop owner is a State largesse. The Self-help Groups, whose identity for want of registration or any such foundation is doubtful, cannot be termed as juristic persons within the meaning of public bodies or public institutions...Even if the services rendered by a so-called Self-help Group are voluntary, yet the relationship of agency between a self help group and State, must have a legal sanctity."

Cannot erode competition in a level playing field

The Court also emphasized that the law does not conceive application of the rule of preference by eroding competition in a level playing field.

"The government order dated 7.7.2020 undoubtedly is violative of Article 14 of the Constitution of India, once it excludes the participation of eligible village residents and other juristic persons such as cooperative societies or Gram Panchayats at par with the Self-help Groups.

The individual's right of consideration as compared to that of a juristic person for employment or grant of licence by the State stands on equal footing and no one can be eliminated or ousted in order to promote a monopoly in favour of any particular category of persons like the situation at hand," the Court held.

It observed that normally, eligibility of a fair price shop dealer is dependent upon his being a resident of the same village and the process of selection is through an open meeting of the Gaon Sabha for which the resolution is passed by the registered voters of the same village by majority.

Further, Section 12(2)(e) of the National Food Security Act, 2013 enables the competent authority to give preference to the public institutions or public bodies only when there is an impasse between a person and a public body/institution or two public bodies/institutions on account of the support of villagers being equal.

Thus, self-help groups are eligible for participation in the selection process of fair price shop dealership. However, to apply the rule of preference exclusively in terms of impugned GO is unconstitutional, the Court held.

"The rule of preference is supplementary to the essential rule under which every person including the public institutions or public bodies may compete for allotment of a fair price shop in an open meeting of the Gaon Sabha. The purpose is to design a result oriented delivery system.

Executive actions can't supplant legislative mandate

The Petitioner had argued that once the State Government, by undertaking its composite legislative exercise devolved the selection process of dealers upon the Gaon Sabhas to strengthen Public Distribution System, it was thereafter impermissible for the executive authority of the State to act contrary to the object of local self-governance.

On this point, the High Court held,

"The question as to whether it was right for the State Government to supplant the existing process of selection prescribed under the government order dated 5.8.2019 by a rule exercisable at the discretion of District Magistrate/Collector and that too by ousting the participatory rights of the eligible local villagers, in my humble view, the impugned government order dated 07.07.2020 defeats the very object and purpose of the Article 243-A together with Article 243-G of the Constitution of India when read with Section-15(xxix) of the U.P. Panchayat Raj Act, 1947."

It also observed that devolution of function relating to the selection of fair price shop dealers upon the Gram Sabhas would certainly help the targeted population residing in village areas to be served better and is necessary to reform Public Distribution System for its inclusion in Schedule-XI of the Constitution of India i.e. Entry-28.

Right to food

The High Court reiterated that right to food is a fundamental right of every human— without which the dignified existence of human beings is inconceivable, and the state has a bounden duty to make sure that no one dies of starvation/ hunger.

The discharge of this obligation, the High Court observed, the Government must have a Public Distribution System and the same must fulfil the object of 'Targeted Public Distribution System', i.e. to reach out to the underprivileged citizens and work to the optimum good of targeted village population.

"Let no one die of hunger is a fundamental duty postulated under Article 47 of the Constitution of India that must be read as a part of the right to life under Article 21 for it is the right to food.

In other words, right to food is inherent in Article 21 of the Constitution of India obliging the State to ensure the execution of its duties in the true spirit of Article 47 read with Article 39-A of the Constitution of India," it observed.

Constitution does not recognize caste-based identities of groups

During the gearing, the State counsel argued that any Self-help group comprising of larger number of individuals belonging to Scheduled Caste would qualify the group as 'Scheduled Caste Group' for the purposes of implementation of reservation policy.

Taking objection to this, the High Court struck a note of caution that Article 19(1)(c)— the right to form associations or union— does not empower the State to recognise the identity of a juristic person on the basis of any attributes of caste, creed or religion.

"The welfare state i.e. India as an organisational structure under the Constitution of India does not have any identity based on caste, creed or religion. The sovereign recognition of our welfare state i.e. Bharat is territorial and this position is well defined under Article-1 of the Constitution of India. The right embodied under Article 19(1)(c) enables the individuals to bury all discriminations based on caste, creed or religion.

The recognition of linguistic minorities or ethnic groups for 25 development of their language, culture and faith is different and this liberty is protected within our Constitutional ethos of inclusive growth and unity to shape the universal order of mixed freedom in postmodern socio-liberal democracy," the High Court observed.

Case Title: Haripal v. State of UP & Ors.

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