The Telangana High Court has dismissed a number of criminal petitions filed by rice millers from various districts seeking directions to quash cases registered against them on charges of diversion of rice meant for the public distribution system for personal gain.
Delivering the verdict on the grounds challenging the issuance of the FIR against them, Justice J. Sreenivasa Rao observed that the rice millers had not supplied milled rice to the order, equivalent to paddy rice to the government. The allegations included that the appellants “dishonestly and fraudulently misappropriated and diverted the rice for their personal and financial gains”.
The charges “prima facie disclose cognizable offenses and warrant investigation”, the order said. When the “investigation is at the threshold”, the petitioners were not entitled to set aside the proceedings, the judge said, and he disagreed with the petitioners’ contention that Section 316(5) of the Bharatiya Nyaya Sanhita could not be invoked against them as they did not fall within the meaning of “agent” under Section 182 of the Contract Act, 1872.
They claimed to have entered into an agreement with Civil Supplies Corporation to supply milled rice to order against paddy rice supplied by that company. Describing the argument that section 316(5) of the BNS could not be invoked against them as a “misconceived” notion, the judge noted that the execution of the agreement and the admitted trust of the paddy clearly demonstrated an agency relationship involving dominion over the property.
The judgment states that rice millers (who entered into contractual arrangements for their own milling and received paddy rice obtained under the MSP program) have a binding duty to convert and return the milled rice to the corporation. “Such a mandate is directly attracted by Section 316 (5) of the BNS,” reads the judgment.
“The mere characterization of the transaction (the return of custom milled rice) as ‘work’ does not diminish the legal effect of the mandate, as the existence of control associated with forgetting to return or account is determinative,” the judge noted.
Published – 08 May 2026 20:55 IST
