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2019 Supreme(Kar) 1806

IN THE HIGH COURT OF KARNATAKA AT BENGALURU
G.NARENDAR, J.
SRI ANJAN GOSWAMI THE SENIOR MANAGER KHADKESHWAR HATCHERIES LTD., - PETITIONER
Vs.
THE AGRICULTURE PRODUCE MARKET COMMITTEE, KOLARA REPRESENTED BY ITS SECRETARY - RESPONDENT
CRIMINAL PETITION No.163/2014
Decided On : 10-10-2019

Advocates Appeared:
For The Appellant : SRI GIRIDHAR.H, ADV.
For The Respondent: SRI T.SWAROOP, ADV.

Headnote:

Criminal Procedure Code,1973 - Section 200 - Karnataka Agricultural Produce Marketing (Regulation and Development) Act, 1966 - Sections 144, 117, 8, 65 , 66 and 117(A) - Commodities in bulk quantities - Evidencing payment of market fee by him - Domestic consumption - Whether the specified agriculture produce purchased by Respondent 1 within the market area and used in manufacturing a commercial product could be held to be for domestic consumption and thereby would exempt it from obtaining licence under Section 9(2) as also from levy and payment of market fee under Section 17(iii)(b) of the 1964 - Whether market fee can be levied on agricultural produce brought for sale or sold in the market area in case the mill did not produce the agricultural produce for sale but produced them for use as its raw material for manufacturing the end product - whether the bamboos are purchased by the respondent Mills for selling them or for using them as their raw material in the manufacture of paper - Allegation against the petitioner is that the petitioner is Senior Manager Hatcheries Private Limited and in the conduct of its business, it purchases notified produces like Broken Rice, Maize and consumption in hatcheries, that is, to manufacture chicken feed to feed chicken, in turn is subsequently sold to its customers - Petitioner is buying notified commodities in bulk quantities - petitioner who indulges in purchase of bulk quantities of notified agricultural produces, comes within ambit of definition of “Trader” under Section 2 (48) of the Act and petitioner without obtaining license has been carrying on business of purchase of notified agricultural produces in bulk quantities petitioner neither obtained permit nor he is able to produce invoices or bills evidencing payment of market fee by him - Enforcement Cell visited the premises of the petitioner and on inspection, they found Bills and Invoices - Books of Accounts evidencing purchase of Broken Rice and Maize in bulk quantities and when questioned – Held, Market area by a rice miller and same paddy is converted into rice and sold, then the rice miller will be liable to pay market fee on his purchase of paddy from the agriculturist producer under sub-clause (2) of Section 17(iii)(b) - He cannot be asked to pay market fee all over again under sub-clause (3) in relation to transaction of rice. Nor will it be open to the market committee to choose between either of the two in example just given. Market fee has to be levied and collected in relation to the transaction of paddy alone – Court are of considered opinion as the retail trader cannot sell agricultural produce in quantity more than that prescribed in the circular and also such retailer himself cannot purchase and store more prescribed in the circular, therefore, the meaning of “domestic consumption - Parties could not bring to the notice of the High Court relevant provisions of the 1964 Act which were necessary to be considered to adjudicate upon issue in controversy - Purchase of agricultural produce in bulk cannot be termed to have been made for “domestic consumption - There is no dispute that the petitioner has been purchasing notified agricultural produce like Broken Rice and Maize for the purpose of chicken feed and said product is pursuant to process/manufacturing and the product is used to advance its business activities i.e., feeding the chicken which are meant for sale to the public and not for any personal consumption - Petition stands dismissed

ORDER :

Heard the learned counsel for the petitioner and learned counsel for the respondent.

2. Petitioner is before this Court being aggrieved by the complaint lodged by the respondent Market Committee, Kolara invoking the provision of Section 200 of Cr.P.C. complaining violation of the provision of Sections 8, 65 & 66 and punishable under the provisions of Sections 144, 117 and 117(A) of the Karnataka Agricultural Produce Marketing (Regulation and Development) Act, 1966 (hereinafter referred to as ‘the Act’ for short).

3. The allegation against the petitioner is that the petitioner is the Senior Manager of M/s. Khadkeshwar Hatcheries Private Limited and in the conduct of its business, it purchases notified produces like Broken Rice, Maize etc., for the use and consumption in the hatcheries, that is, to manufacture chicken feed to feed the chicken, which in turn is subsequently sold to its customers. That the petitioner is buying notified commodities in bulk quantities. That the petitioner has been sourcing notified agricultural produces from various market areas like Davangere, Harapanahalli, Kottur, Baramasagara and Ranebennur. That the petitioner who indulges in purchase of bulk quantities of notified agricultural produces, comes within the ambit of the definition of “Trader” under Section 2 (48) of the Act and that the petitioner without obtaining license has been carrying on the business of purchase of notified agricultural produces in bulk quantities. That the petitioner neither obtained permit nor he is able to produce invoices or the bills evidencing payment of market fee by him. That the turnover that has been detected is at Rs.3,67,88,149/and the petitioner is liable to pay 1½% on the turnover i.e., Rs.5,51,822/as market fee. That he has evaded payment of the said sum. That the Enforcement Cell visited the premises of the petitioner and on inspection, they found Bills and Invoices, Books of Accounts evidencing purchase of Broken Rice and Maize in bulk quantities and when questioned, the petitioner was unable to produce the permit or the records for having paid the market fee. That despite giving the petitioner an opportunity to furnish the same, the petitioner has failed to produce the material to demonstrate payment of market fee or the permits enabling him to purchase the said notified agricultural produces. That on account of failure to satisfy the Authorities, the petitioner is liable to pay penalty calculated at the rate of three times the sum evaded and hence, he is liable to pay penalty which is around Rs.16,55,466/. That failure to produce the permit would constitute an offence punishable under Sections 114, 117 and 117(A) of the Act. That all in 179 bills/invoices were found and seized by the Enforcement Cell. In this background, the petitioner is before this Court.

4. It is contended by the learned counsel for the petitioner that in terms of Section 2(48) of the Act, the petitioner would not come within the definition of ‘Trader’ as purchase is for the domestic consumption. He would contend that the purchases made, were for the purpose of manufacturing/processing the same into chicken feed and that the chicken feed so manufactured has been used by the petitioner hatcheries only and there has been no sale of processed or manufactured chicken feed. He would further contend that the petitioner is carrying on his business outside the market yard and hence, he would not come within the ambit of definition of ‘Trader’.

5. Per contra, learned counsel for the respondent would submit that the phrase of ‘Domestic Consumption’ has been gone into by the Hon’ble Apex Court and the Hon’ble Apex Court has laid down the law in this regard in the case of Krishi Utpadan Mandi Samiti, Allahabad vs. Baidyanath Ayurved Bhawan Private Limited and Another reported in (2011) 12 SCC 277.

6. Per contra, learned counsel for the

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