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PATNA HIGH COURT
S. SARWAR ALI & N.P. SINGH, JJ.
Messrs B & K Traders & 16 others - Petitioners
Vs.
The State of Bihar - Respondents
C.W.J.C. Nos. 1084, 545, 677, 808 to 812, 1172, 1173, 1212, 1296, 1354, 1355, 1359, 1360 & 1363 of 1974
Decided on : 25.11.1974
Where the petitioners carried on the business of edible oil and Vanaspati imported from out side the market area and market fee was sought to the levied,
Held that under Sec. 18(2) (ii) the Market Committee has to "issue licenses in accordance with the rules to traders, brokers, weighman, measurers, Surveyors, warehouse men, and other persons including persons or firms engaged in processing, storing or pressing of agricultural produce concerned operating in the market area." In view of Sec. 18 (2) (iii) the Market Committee has to "control, regulate and run the market in the interest of the agriculturists and licenses in accordance with the provisions of the Act, and the Rules and the bye laws made thereunder". Thus under clauses (ii) & (iii) of Sub Sec. 2 of Sec. 18 there is specific reference to traders and licensees, which will include the petitioner also.
(Para 14)
Under Sec. 27, Market Committee has been authorised to levy and collect market fees on agricultural produce bought or sold in the market area. No exception has been made in favour of any trader. Once any of the articles notified is "bought or sold" within the market area, by whomsoever it may be, the market fee becomes payable. In view of the proviso to Sec. 27 (i), any agricultural produce which has been imported from outside the market area for being processed or exported, but is not exported within 21 days, the presumption would be that it has been bought or sold in market area. The transaction made by the petitioner is therefore covered by the provisions of the Market Act. The market retails to an agricultural produce and as such agriculturists in general are benefited but it cannot be said that the sole object of the Act, is only to regulate the buying & selling of agricultural produce.
The provisions are attracted even when a trader sells any article which he has not purchased from any agriculturist in the market area, but having imported it from out side, sells it in the market to an agriculturist or to any buyer including a trader (Relied on 1971 BLJR 1038 & 1011) (Para 15)
Held further, that Sec. 30 provides how the fund of the market Committee is to be appropriated. Under Sec. 27 the amount realised within the market area as market fee, is to be spent for the facilities of sellers and buyers within the market area, which will include traders also, there is thus sufficient quid proquo for levies and it is a fee. (Para 34)
Bihar Agricultural Produce Markets Act, 1960, Sec. 31 (A), 31 (B) & 31 (C)- Restrictions imposed, whether unreasonable-Held, that the provisions are incidental for exercise of proper control by the Market Committee and for the purpose of stopping evasion of market fees and they cannot be held to be either restrictions or unreasonable restrictions over the exercise of right of freedom of trade by the petitioner. (Para 25)
Constitution of India, Art.19 (1) (g)Market committee realising market fee and granting licenses to traders-Realisation or grant whether amounts of unreasonable restriction on a trader-Restriction whether saved under Art. 19 (6)-Provisions whether hit by Art. 301-Restriction whether unreasonable under Art.304 (b)-Burden to Prove that the restrictions are reasonable, whether on the State-Realisation of market fee whether protected under Art. 358.
Held, that the provisions of the Market Act, are regulatory or compensatory in nature and provisions of Art. 301 or 304, (b) are not attracted..... The scheme of the market Act, show that several facilities have been provided to the traders and agriculturist who sell or purchase articles in the market. Every person cannot derive equal benefit from any particular regulatory or compensatory enactment. Some may derive more while others may not be benefited to that extent. But that will not be a ground for holding that the realisation of market fee amounts to a restriction on the freedom of the petitioner to carryon trade, commerce etc. Although the petitioner might be purchasing articles from outside the State or outside the market area and selling its goods to persons coming to the market, it also derives benefit of the arrangements made by the market Committee and it cannot be said that such provisions are in any way impediment on its freedom of trade. (Para 20)
Held, further that even if the provisions regarding imposition of market fee and license etc. be taken to the restrictions, they are reasonable restrictions in the interest of the general public within the meaning of Art.19(6) as well as Art.304 (b) of the Constitution.
(Para 23)
Constitution of India, Art.254-Market Committee Act, whether repugnant to the Essential Commodities Act-Matters whether covered under List II entry 28 or 26.
Held, that the Act, in pith & substance is meant for establishment of markets in different parts of the State and for regulating sale and purchase of agricultural produce within such markets, so that the agriculturists, traders and other purchasers can derive benefit. As such, the State legislature was competent to legislate over other matters under entry 28 of List II.
(question regarding repugnancy not decided) (Para 30)
1. The petitioners in these writ applications are either firms or partners of firms carrying on business in food-grains, edible oils, vegetable oils etc. and they are licensees under the Bihar Food-grains Dealers Licensing Order, 1967 (hereinafter referred to as the Food-grains Licensing Order"), or the Bihar Edible Oil Whole-sale Dealers Licensing Order, 1966 (hereinafter referred to as the "Edible. Oil 'Licensing Order"), or the Bihar Vanaspati Dealers' Licensing Order, 1967 (hereinafter referred to as the "Vanaspati Licensing Order'') : By these writ applications they have challenged the vires of the different provisions of the Bihar Agricultural Produce Markets Act, 1960 (hereinafter referred to as the "Markets Act") and the legality of the different communications issued by the different Market Committees established under the Markets Act.
2. As common question of law are involved in these writ applications and even the facts alleged are, more or less, similar, they have been heard together with the consent of the parties and this judgment will govern them all. C.W.J.C. no. 1084 of 1974 has been taken up as the first case. I, therefore, propose to deal with this case in the first instance.
3. According to the petitioner it caries on business mainly in edible oils and vanaspati at Muzaffarpur, and, as such, it is licensee under the provisions of the Edible Oil Licensing Order and Vanaspati Licensing Order. In exercise of the powers conferred by section 6 of the Markets Act, the State Government established a Market Committee in the town of Muzaffarpur by a notification, dated the 19th September, 1963, and declared paddy, rice, mustard oil, gram, maize etc. as notified agricultural produce for the said area. Out of the notified agricultural produce, the petitioner firm deals only in mustard oil, which it imports into the market area from oil mills situated in the State of Uttar Pradesh, Rajasthan and Haryana and Delhi and sells them within and outside the market area to different dealers and consumers, either on its own account or as commission agent of the concerned mills.
4. The petitioner-firm was served with a notice, dated the 25th April, 1974, issued by the Secretary, Agricultural Produce Market Committee, Muzaffarpur (respondent no. 2), informing the petitioner that, in pursuance of the amendment made in the Markets Act, by the Ordinance, market fee on sales and purchases of all notified agricultural produce would be realisable at the rate of one per centum and return showing purchase and sale of each sanction of agricultural produce would be filed within 7 days of the day of transaction. A copy of the said notice is annexure I to the writ application.
5. After having received the said notice (annexure 1), the petitioner sent a reply to the Market Committee saying that it did not deal in mustard oil produced or purchased in the market area, and, as such, it was not liable to pay any market fee, or to file any return in relation thereto. According to the petitioners, inspite of the aforesaid objection, the petitioner has been served with a notice of assessment, dated the 11th May, 1974, saying that, as the petitioner had not submitted any return in Form A for the period mentioned therein, the petitioner should appear on the next day fixed, otherwise, exparte assessment would be completed against it and it will also be liable to pay the penalty. A copy of the said notice is annexure 2 to the writ application. The petitioner, under protest, deposited a sum of Rs. 500/- with the Market Committee, asserting that it was not liable to pay any market fee under the provisions of the Markets Act. A copy of the said letter, dated the 25th June. 1974, is annexure 3 to the writ application, But, the secretary (respondent no. 2), by his letter, dated the 5th July, 1974, asked the petitioner to file the return within a week from the date of receipt of the said letter. A copy of the said letter is annexure 4 to
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