HC terms J&K Brick Kiln 2010 Act, Rules, comprehensive regulatory framework

Srinagar, Nov 6: The High Court of J&K and Ladakh has held that the Jammu and Kashmir Brick Kiln (Regulation) Act, 2010, and the Rules framed thereunder constitute a comprehensive regulatory framework to control the establishment and operation of brick kilns, as also the trade, sale, storage, and distribution of bricks within J&K.

A bench of Wasim Sadiq Nargal held this while dismissing a petition by dealers whose contention was that the act and the rules apply only to brick kiln owners and not to them, as they were dealing in finished bricks imported from other States.

In their plea, the aggrieved dealers had assailed the orders issued by the District Magistrates of Kathua and Samba directing the seizure of vehicles transporting bricks imported from outside Jammu and Kashmir and imposing penalties under the legislation and the rules thereunder.

The court noted that the inclusion of the term dealer under Section 2(e) and the express language of Rule 3 clearly manifest the legislative intent to bring both the manufacturers as well as dealers within the fold of the regulation.

The court observed that the unregulated import of bricks from outside could result in serious economic distortions such as hoarding, black marketing, and artificial shortages.

Allowing unmonitored imports would undermine the local brick manufacturing industry and defeat the objectives of the regulatory framework meant to ensure transparency and fair trade, it said.

“This court is of the view that the unregulated import of bricks from outside the Union Territory without proper licensing and monitoring would inevitably lead to hoarding, black marketing, and deliberate shortage, thereby disturbing the market equilibrium and causing loss to the local revenue and adverse repercussions on the State economy,” the court observed.

The court termed as misconceived the dealers’ contention that the registration under the Goods and Services Tax Act, 2017, exempted them from the requirement of obtaining a license under the Brick Kiln Act.

“The two enactments operate in distinct spheres, while GST registration pertains to fiscal compliance and tax collection, the Brick Kiln Act is a regulatory statute aimed at environmental protection and land use control. Compliance in conformity with one statute does not dispense with the mandatory requirements of another statute operating in a different field,” it said.

The court noted that the contention that the rule is violative of Article 19(1)(g) of the Constitution is not tenable in the eyes of law in light of the fact that the licensing framework neither prohibits the carrying on of trade nor imposes unreasonable restrictions thereon, rather it merely regulates the same.

“The conditions prescribed under the rules are regulatory in nature, intended to ensure that brick kilns operate in conformity with environmental safeguards, public health considerations, and land use norms. Such regulatory restrictions are squarely covered under clause (6) of Article 19 of the Constitution of India,” it said.

The court accepted the objection to maintainability of the petition by the respondents, saying the Brick Kiln Act and the Rules framed thereunder provide for an appellate mechanism against orders passed by the licensing authorities.

“The petitioners, without availing such statutory remedies, have invoked the extraordinary jurisdiction of this court under Article 226,” it said.

As regards the argument regarding the forms appended to the Rules of 2017, the court said, “Since dealers are engaged in the sale of bricks, they would necessarily fall within the ambit of Form B”.

The court noted that the petitioners have not demonstrated any violation of natural justice, mala fide exercise of power, or lack of jurisdiction

“This court further holds that the licensing requirement under Rule 3, read with Section 2(e) of the act, is a reasonable regulatory condition and does not violate Article 19(1)(g) of the Constitution. It is a legitimate exercise of state power in the interest of public order, environmental balance, and fiscal responsibility, fully protected by article 19(6) of the Constitution of India,” the court said and dismissed the petition.