(1987)1984November 30 [HADJIANASTASIOU,JJ INTHEMATTEROFARTICLE 146OFTHECONSTITUTION MAKARONOPEION G.CARKOTISLTD., Applicants, v. 1.THEREPUBLIC OFCYPRUS, THROUGH (a)THE MINISTEROFCOMMERCE ANDINDUSTRY, (b)THEMINISTEROFFINANCE, 2.THECYPRUSGRAINCOMMISSION, Respondents. (CaseNo. 167/80). TheGrain ControlLaw, Cap.68—Section 3
(1)—Orderthereunderdeclaring«hard com»tobea«controlledarticle»—Whether«macaroni», whichisproduced of «hard com» can be considered by virtue of saidorder asa'Controlledarticle»—Section 19ofsaidlaw—Questionanswered inthe negative. The applicants own and operate a macaroni producing factory. They sell 5 theirproductbothinCyprusandabroad.Byletterdated26.5.80respondents 2informed the applicantsthatforthepurposeofalicenceforexporttheywill have to pay £20 per ton of exporting macaroni for the months of May and June 1980.Asa resultthe applicants filed thepresent recourseItshouldbenotedthatmacaroniismadeentirelyofhardcomandthathard 1 0 com had been declared underthe provisionsofs.3(l)ofCap.68asacontrolledarticle.Macaroni,however, wasnotdeclaredasacontrolled article under the said provision. Counsel forthe respondentssubmitted thatasmacaroniismade entirelyof hard com itshould alsobe considered asa controlled article. 15 Held, annulling the sub judice decision:
(1)Ifmacaroni cannot be consideredasa«controlledarticle»,itdoesnotfallwithintheprovisionsofCap. 68 and, consequently, the imposition of taxfor thepurposes of exportislegally unjustified and voidable.
(2)Inthe lightof the provisionsofs.19 of Cap.68theaforesaid submission 2 0 ofcounselfortherespondentscannotbe entertained. Subjudice decisionannulled. No orderasto costs. 52 3 C.L.R. Makatonopeion Carltotis v. Republic Recourse. Recourse against the decision of the respondents whereby applicants were required to pay £20.- per ton of macaroni exported during the months of May and June, 1980 in order to 5 secure an export licence. Chr.Triantafyllides, for the applicants. C. Velaris, for the respondents. Cur.adv. vult HADJIANASTASSIOU J. read the following judgment. In the 10 present recourse under Article 146 of the Constitution, the applicants have applied to this Court for the following relief: Declaration that the decision of the respondents contained in exhibit 1 dated 26th May, 1980, to prescribe or order that the applicant will have to pay £20 per ton exported for the months 15 May and June 1980 in order to secure an export licence or any othersum orat allisnulland void and of no effect whatsoever. TheFacts: The following facts are relied upon in support of the present application:
- The applicants own and operate a macaroni pro20 ducing factory. 2.The said factory dealswith localsalesaswellas with exports.
- The factory deals with 90% of the exports of macaroni from Cyprus.
- The exports of the said factory constitute60%ofitsoverallproduction.5.On26thMay,1980,theCyprusGrain Commission addressed a lettertothe factory of G. Car25 kotisLtd.,andhadthistosay:«Bythepresentletterweinform you that for the purpose of a licence for export the prices which you willbe paying for each ton of exporting macaroniwillbe£20 per ton forthe monthsMayandJune 1980».
- Exhibit1causesgFeat damage to the applicants because they are forced to export and selltheirproductsatahigherpricewhichisnotcompetitiveinmarketsabroad.7.Theapplicantsallegethatthedecision complained of has been reached without any orproper inquiry asto the relevant facts. And
- The applicants allege that quite apart from the illegality complained of, both the quantity and the amount pre35 scribed,areneitherjustified norsupportedbythefactsofthecase. The present application is based on the following grounds of law:
- There isno law or regulation authorising respondents to 53 Hadjlanaata«louJ. Makaronopeion Carkotl·v.Republic
(1987)reach the decision contained in Exhibit 1, and the said decision lacks completely legal basis.
- The decision complained of has been taken in excess or in abuse of powers in that it is arbitrary and unreasonable havingregardtotherelevantfactspertainingto the matter.3.The decision complained ofiscontraryto(a)Article 5 23oftheConstitution inasmuchasitconstitutesarestriction and/ orlimitation on applicants'propertywhichisnotwarranted under the said article, (b)Article 25of the Constitution in as much asit constitutesarestriction and/or limitation ontheirrightstocarryon freely theirbusinessnotbeingarestrictionand/orlimitationwhich, 10 iswarranted bythesaid article,(c)Article28oftheConstitutionin asmuch asother businesses arenotlikewiserestricted or treated thus applicants are being discriminated against.
- The respondents reached their decision complained of, without any, or any adequate inquiry as to all relevant facts and without affording 15 applicants the opportunity of being heard. And
- The decision complained of isnot dulyreasoned atall. On 28th August, 1980, the respondents gave notice that they intend to oppose the said application, and their opposition is based on the following grounds of law:
- The first respondents 20 allegedthattheyhavenothingtodowiththeactordecision complained of and seek the dismissal of the case vis-a-vis with costs. Nothing contained in the application discloses that they have taken any decision ordidanyactwhichcouldinanywayform the subject-matter oftheabove-titledrecourse.2.Thesecondrespon- 25 dents contend thattheactordecision complained ofcontained in exhibit 1attached to the application hasbeen taken according to theConstitution,theLaw(andinparticulartheGrainControlLawt Cap. 68s.5(b)and (f),regularly,rightlyandjustly,allthefacts and circumstances having been taken into account. 3.Thesaid act or 30 decision complained of isdulyreasoned.Thereasoningthereof is apparent from the file of the case, indeed, the applicants have a macaroni factory in Cyprus and macaroni is produced from semolina aproduct ofhardwheat. Hardwheatisacontrolledarticle according to the Grain Control Law. Respondents 2 are a 35 statutorybody entrusted withthecontroland tradingofgrainproduct of hard wheat. One oftheir aims isthe supplytoCyprlotsof cheap bread and grain products generally and for the purpose they are subsidised bytheGovernment with5-10 million pounds per annum.Tomeettheirresponsibilitiesaccruingfrom theafore- 40 54 3 C.L.R. Makaronopeion Carkotis v.Republic Hadjlanastaslou J. saidlawthesecondrespondentspurchaseallthelocalharvestof controlled articlesand when necessary makeimportsfrom overseas.Atallmaterialtimesthe second respondents were purchasinghardwheatfromlocalsuppliersat£88pertonandfromover5 seas C.I.F. Cyprus at £100 per ton. Furthermore, the second respondentswereencumberedwithfurther costsincludingstorage,transport,runningandotherexpensesequallingabout£7per ton. By so doing the second respondents were subsidising the localhardwheatwith£44pertonandtheimportedonewith£56 10 perton.Thesaidsubsidiescomeoutofthetax-payersmoneyand weremadeforthebenefitofthepublicatlargewithintheRepublic and not for the benefit of foreigners. Inthe cases of exportsthe secondrespondentswereandarewillingtosellcontrolledarticles tomanufacturers andmerchantsatcostand/oratalessersubsidy 15 than the one afforded for the local market as inthe case of the applicants.Indeedthesecond respondentsbelievethattheirsaid actordecisioncomplainedofwastakeninthepublicinterestand isinaccordance withtheletterandtenoroftheConstitution and theLaw.Respondents2denyallandeachofthefactsreliedupon 20 intheapplicationsofarastheyareinconsistentwiththeaforesaid. On 24th November, 1980, in the absence of counsel for the respondentscounselfortheapplicantsappliedforadateofhearingandthecasewasfixedforhearingonthe7thMay,1981.Inthe meantime,counselfortheapplicantsappliedforthechangeofthe 25 datebecauseasheputit,hewouldbeawayabroad andthecase wasfixedforhearingonthe8thOctober, 1981,at10.00a.m. The first submission of learned counsel for the applicant was thattheterm«regulate»cannotpossiblybeinterpretedascontaininga monetaryburden.Tosupporthissubmissionhereferred to 30 theprovisionsofs.6ofCap.68whichprovidesasfollows:«Thefunds oftheCommissionshallconsistofsuchmoney as may accrue from the operation of the Commission and suchothermoneyasmayfromtimetotimewiththeapproval oftheGovernorbeapportionedfrompublicfunds.» 35 Idonotsharetheviewthattheaboveprovisionslimitthepossibility to interpret the term «regulate» as containing a monetary burden also and I accept the submission of the learned counsel of the respondent authority that the provisions must be interpretedinawidermanner. 55 Hadjlanastaslou J. Makaronopeion Carkotf» v.Republic
(1987)The vital issue which must be decided iswhether macaroni isa «controlled article» and falls within the ambit of the provisions of thelaw(Cap.68) orwhetheritcannotbe considered asa«controlledarticle»and therefore, theimposition oftaxforthepurposesof export islegally unjustified and consequently voidable. 5 Pursuant tos.3 of Cap.68: •3.
(1)IfatanytimeitappearstotheGovernorinCouncilto be necessary or expedient for the purpose ofsecuring a sufficiency of any kind of grain essential to the well-being of the community or its equitable distribution or availability of fair 10 prices or that public interest so requires, the Governor in Council may, by Ordet (hereinafter referred toasthe Control Order) declare thatkindofgrain tobea controlled article and thereupon the provisions of this law shall have effect in respect of such article.» 15 It is accepted by both sides that macaroni itself has not been declared as a controlled article. The submission of the counsel of the respondents isthat macaroni is a controlled article because macaroni is made entirely of hard com and hard com isacontrolled article within the meaning 20 of the law. The allegation prima facie seems to be reasonable but, in my view, itcannot be sustained since s.19 provides as follows: «Ifitappearstothe Governor inCouncil thatpublic interest so requires the Governor inCouncil may, inmakingacontrol 25 order under,subsection
(1)of s.3 include bread therein as a controlled article and there upon the provisions of this law shallapply mutatismutandistobreadasifitwerea controlled article for the purposes ofthislaw.» Itisobviousthatbread whichisthemainderivativeofgraincan- 30 notbeand isnotclassified ascontrolled articleasfrom theapplication of the law in relation to grain only but because there is a special provision forthat purpose. Ido notagree therefore thattheprovisionsofthelaw,inrespect ofgrainareenough togivemetherighttoextendtheirapplication 35 mutatis mutandis inthe case ofmacaroni also. 56 3 C.L.R. Makaronopeion Carkottov.Republic Hadjianastaslou J. Itisundoubtedly adifferent productwhichcannotbe classified asacontrolled articleunlessitisdeclared assuchpursuanttothe provisionsofs.3ofCap.68. Forthereasonshereinabove indicated, therecoursesucceeds. 5 Thereshallbenoorderastocosts. Subjudice decision-annulled. Noorderastocosts. 57