2006 Supreme(Bom) 900

IN THE HIGH COURT OF BOMBAY
(B. H. Marlapalle and D. B. Bhosale, JJ.)
BRITANNIA INDUSTRIES LTD. - Petitioner.
vs.
BOMBAY AGRICULTURAL PRODUCE
MARKETING COMMITTEE, BOMBAY and another - Respondents.
Advocates Appeared
For petitioner: C. M. Korde with M. N. Jadhav and J. J. Soloman instructed by Soloman and Co.
For respondent No.1: Y. R. Naik with Prashant Naik
For respondent No.2: K. K. Singhvi, Spl. Senior Counsel with Ms. Madulata Kajale, AGP

Headnote:Maharashtra Agricultural Produce Marketing (Regulation) Act (20 of 1964) -Section 13(1-A)(a), 62, 4 and 31 - Sugar - Considerable as agricultural produce - Sugarcane procured from other States - Whether market fee leviable - Market Committee cannot levy duty if it is procured from area other than market area - Market fee unlike octroi fee cannot be levied on entry of goods in municipal limits. - Unless the sugar procurement is done by the petitioner-company within the area of Greater Mumbai and Turbhe Village of Thane Taluke of Thane District or any other area notified by the Government of Maharashtra to be a part of the market area of respondent No. 1, it cannot levy market fees on sugar. The respondent No. 1 has no power to levy market fees under Section 31 of the Act on the entire quantity of sugar that arrives within its market area on the procurement made by the petitioner-company and directly from the sugar factories which are located within the market area of respondent No. 1. It is, therefore, necessary that the petitioner-company places before the respondent No. 1 all its record to show that sugar was procured/purchased from the places outside the market area of respondent No. 1 and if the respondent No. 1 on a verification is satisfied, to that extent the respondent No. 1 shall have no authority to levy market fees under Section 31 of the Act. This is an issue which will have to be examined by the Market Committee afresh and it is imperative for the petitioner-company to submit all the records before the respondent No. 1 for such a verification and this should be done at the earliest possible. Court has no doubt that the respondent No. 1Market Committee shall have powers to levy market fees under Section 31 of the Act only on the quantity of sugar that has been purchased/procured within its market area and it cannot levy market fees on the entire sugar quantity that is received by the petitioner company. The Company is right in saying that the levy of market fees cannot be on the lines of octroi i.e. charge by the Municipal Corporation. For charging octroi arrival is the precondion, whereas for levying market fees, marketing of sugar within the territorial limits of the Market Committee is the precondition. The petitioner-company will be, therefore, entitled to claim refund from the payments already made on account of the interlocutory orders if it is able to prove on the basis of the documents to be submitted to the respondent No. 1 that only part of the procurement or none at all has been made in respect of sugar from any place within the market area of the respondent No. 1.

       Maharashtra Agricultural Produce Marketing (Regulation) Act (20 of 1964) -Sections 31 and 34-A to 34-C - Quid pro quo - Applicability of principle - Whether Market Committee can levy fees - Goods produced from outside State - Court way back already held APMC cannot levy market fee because no marketing took place within area - Supervision charges under Sections 34-A to 34-C can be collected if staff is proved to be deployed by State and such staff is working in fact. - Coming to the doctrine of "quid pro quo ", as already held in writ petition that for levying market fees the said doctrine is not applicable. Court also held that the Market Committee has no power to demand and recover supervision charges under the scheme of Sections 34-A to 34-C of the Act, for the time being and such charges can be demanded and collected only when the Government staff is deployed for the supervision of the marketing activities of sugar i.e. procurement/purchase of sugar by the petitioner-company within the market area of the respondent No. 1. It will be, therefore, necessary for the petitioner-company to procure/purchase sugar from the market yard or sub-centre of the respondent No. 1, should the company decide to procure the same from the Mumbai Market and even if it procures sugar from private dealers or importers or any other traders including the Association of Sugar Traders within the market area of the respondent No. 1, it shall be liable to pay market fees on such quantity of sugar. As suggested in Writ Petition Nos. 353 and 1341 of 1998 it is necessary for the petitioner-company and the respondent No. 1-Market Committee to sort out the future arrangements so as to avoid any inconvenience to either of them and at the same time, such an arrangement will facilitate in reducing the disputes between the parties.

       Maharashtra Agricultural Produce Marketing (Regulation) Act (20 of 1964) -Sections 64 and 42(1)(a) - Constitution Act, 1950, Article 226 - Levy of market fee - Opposed - Ground - Sugar not agricultural produce - Contention - Absence of word "manufacture" in definition of agricultural produce takes sugar out of definition totally - Misplaced - Terms ’ gul ’ and ’sugar’ had been deleted from schedule by notification - It cannot be said that it added to schedule for first time. - In the case of Krishi Utpadan Mandi Samity and another v. Shankar Industries and others, JT 1993 (1) SC 601 the Supreme Court again examined the meaning of "agricultural produce" under Section 2(a) of the U.P. Act and held in para 18 that gur-lauta or raskat and rab-galawat and rab-salawat fall within the definition of agricultural produce. In the State of Maharashtra, though Gul is produced from sugarcane, it is an agricultural produce within the meaning of Section 2(1)(a) of the Act and the same conclusion must also apply to sugar which is also produced from the sugarcane. Similarly in the case of Edward Keventer Pvt. Ltd. v. Bihar State Agricultural Marketing Board and others, AIR 2000 SC 1796 the Supreme Court held that, the products "Frooti" and "Appy" would fall within the description of mango and apple specified in the schedule. It observed that the products not being listed in the schedule, would not fall within the ambit of agricultural produce. The observations made in para 5, which are relevant for the present purpose are reproduced as under : -

       "5. A perusal of Section 2(1)(a) unambiguously shows that the agricultural produce which are to be covered by the sweep of the Act necessarily has to be specified in the Schedule. If any agricultural produce is not specified in the Schedule, it goes beyond the purview of the Act and respondent has no power to levy fee on such produce. In the Schedule under caption ’fruits’ mango and apple have been specified as agricultural produce. We further find in the Schedule that under caption ’cereals’ wheat is specified at item No. 3, whereas ’wheat atta ’, ’sujji ’ and ’maida ’ which are the products of wheat are separately specified at item Nos. 14, 15 and 16 respectively. This shows that the agricultural produce ’wheat’ has been treated as a separate agricultural produce as compared to its own product manufactured out of ’wheat’ namely, ’atta ’, ’sujji ’ and ’maida’, ’atta’, ’sujji’ and ’maida’ are basically the agricultural produce of ’wheat’...... .."

       In the case at hand also sugarcane has been separately listed under Item VI in the schedule along with Gul and Sugar and thus the intention of the Legislature is to treat sugar as a produce of sugarcane, which is a separate agricultural produce. Hence, sugar is a produce of agriculture coming into being in a processed form from sugarcane and the absence of the word "manufacture" in the definition of "agricultural produce" under Section 2(1)(a) of the Act would not in any way affect the status of sugar as being an agricultural produce under the Act.