2012 Supreme(SC) 253

2012 (2) Supreme 533
SUPREME COURT OF INDIA
T.S. Thakur and Dipak Misra, JJ.
Krishi Utpadan Mandi Samiti & Anr. — Appellants
versus
Ved Ram — Respondent
Civil Appeal No.9589 of 2010
Decided on : 23-3-2012

Headnote:Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964- Section 17(iii)(b)- Respondent-company engaged in the business of manufacture and sale of milk products including desi ghee – Removal of stock of ghee by respondent company without the requisite gate passes necessary for such removal-Levy of market fee by appellant Samiti on respondent-company-Revision-Dismissed-Writ Petition-Allowed by High Court-Appeal- If gate passes are required to be obtained under the rules, removal of stocks without applying for such gate passes was a reason enough for Mandi Samiti to demand payment of market fee on stocks that were removed- The absence of gate passes was tantamount to removal of the goods in breach of the relevant rules –A dealer who adopted such dubious procedure and means could not complain of a failure of opportunity to produce material in support of its claim that no sale was involved- Samiti and the Deputy Director concurrently held that respondent-company had not been able to rebut the presumption under Section 17 of Adhiniyam- No reason to interfere with said finding by said two authorities -Impugned order passed by High Court set aside and that passed by Samiti and Deputy Director restored-Appeal allowed (Paras 8, 9)

       Facts of the Case :

        A.The respondent-company herein in the instant case was engaged in the business of manufacture and sale of milk products including desi ghee which it markets under the brand name ‘Paras’. The company has set up a manufacturing unit at Sahibabad,District Ghaziabad, which falls within the market area of Krishi Utpadan Mandi Samiti, Ghaziabad (‘KUMS’ for short).

        B. In terms of a show-cause notice issued by the appellant-Samiti, the respondent-company was called upon to produce all relevant documents with regard to the production, sale-purchase, movement and storage of its product for the relevant period. This notice was triggered by a declaration received from the respondent-company that consignment note No.94 dated 14th May, 2004 dispatching 5250 Kgs. of desi ghee to Anand Sales Corporation at Ahmedabad was a stock transfer which did not require any gate pass for its movement outside the market area.

        C. The Samiti accordingly levied a market fee of Rs.9,39,200/- and development fee of Rs.2,34,800/-totalling Rs.11,74,000/- for 3906.80 quintals of desi ghee taken out from the market area of KUMS, Ghaziabad under Section 17(iii)(b) of the Adhiniyam . Aggrieved by the order passed by the Samiti, the respondent-company filed a revision under Section 32 of the Adhiniyam which wasdismissed by the Deputy Director by its order .

        D. The respondent-company then filed Writ Petition before the High Court of Judicature at Allahabad, challenging the orders passed by the Samiti and the Deputy Director on several grounds. The High Court has, by the order impugned in the present appeal, allowed the said petition set aside the orders of the Samiti and the Deputy Director and remanded the matter back to the Samiti for a fresh assessment in accordance with law.

        E. Present appeal has been filed against said order of High Court.

       Findings of the Court :

        A. High Court was in error in holding that even when the movement of goods without gate passes may have been in violation of the rules regulating the issue of such passes, any such violation could only call for a penalty under the said rules. The High Court appears to have overlooked the fact that if gate passes are required to be obtained under the rules, removal of stocks without applying for such gate passes and without furnishing prima facie evidence of proof that there was no sale of the goods involved, was a reason enough for the Mandi Samiti to demand payment of the market fee on the stocks that were removed. The absence of gate passes was tantamount to removal of the goods in breach of the relevant rules .

        B. A dealer who adopted such dubious procedure and means could not complain of a failure of opportunity to produce material in support of its claim that no sale was involved. No opportunity to a dealer who was acting in defiance of the rules and removing the goods without any intimation and permission of the Samiti could be granted for the occasion to grant such an opportunity would arise only when the trader applied for the issue of a gate pass. As a matter of fact, the goods having been taken away without gate passes and without any material to show that there was no sale, the Samiti could demand payment of the market fee and leave it open to the respondent-trader to claim refund by rebutting the presumption that the removal was pursuant to a sale. At any rate, the Samiti and the Deputy Director concurrently held that the respondent-company had not been able to rebut the presumption under Section 17 of the Adhiniyam. There was no reason to interfere with said finding .Impugned order passed by High Court set aside and that passed by the Samiti and the Deputy Director restored. Appeal was allowed