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2017 Supreme(Cal) 624
IN THE HIGH COURT OF CALCUTTA
SAMAPTI CHATTERJEE, J.
Century Plyboards (India) Ltd and another - Petitioners
Versus
The Government of West Bengal and Others - Respondents
W.P. No. 7975 (W) of 2007
Decided On : 17-02-2017
For the Petitioners:Mr. Saptansu Basu, Ld. Sr. Advocate, Mr. Ayan Banerje and Ms. Sudipa Bhattacharya, Advocates.
For the State :Mr. Prithu Dudhoria, Advocate.
The main legal point established in the judgment is that Plywood and Veneer are not considered agricultural produce under the West Bengal "agricultural produce" Marketing (Regulation) Act, 1972, and therefore, no market fee could be levied on them.
Headnote:
market fee - agricultural produce - West Bengal "agricultural produce" Marketing (Regulation) Act, 1972 - [Plywood and Veneer] - [Section 2(a), Section 3, Section 13] - The court determined that Plywood and Veneer are not agricultural produce and therefore, no market fee could be levied under the West Bengal "agricultural produce" Marketing (Regulation) Act, 1972. The court highlighted the definition of 'agricultural produce' and the provisions related to the declaration of market area, and concluded that the imposition of market fees without forming any market area is without jurisdiction. The court also emphasized that the manufacturing process of Plywood and Veneer does not fall under the preview of 'agricultural produce' and therefore, the necessity of payment of fees under the Act would not arise.
Fact of the Case:
The petitioner, a company manufacturing Plywood and Veneer, imported timber logs for the manufacturing process. The State attempted to impose market fee on the Plywood and Veneer, leading to the filing of the writ petition. The petitioner argued that the goods manufactured are neither 'agricultural produce' nor sold and marketed through the specified market points under the West Bengal "agricultural produce" Marketing (Regulation) Act, 1972.
Finding of the Court:
The court found that Plywood and Veneer are not agricultural produce and therefore, no market fee could be levied under the Act. It also concluded that the imposition of market fees without forming any market area is without jurisdiction.
Issues: The issues included the determination of whether market fee can be levied on goods manufactured by the petitioners, whether the impugned notices were beyond the scope of the Act, and whether the manufactured products are products of agriculture specified in the schedule under the Act.
Ratio Decidendi: The court's decision was based on the interpretation of the definition of 'agricultural produce', the provisions related to the declaration of market area, and the manufacturing process of Plywood and Veneer. It emphasized that the manufacturing process does not fall under the preview of 'agricultural produce' and therefore, the necessity of payment of fees under the Act would not arise.
Final Decision: The impugned notifications imposing market fee on Plywood and Veneer were quashed and set aside. The respondents were restrained from levying or demanding any market fees from the petitioner, and directed to refund the sum of Rs. 74580/- to the petitioners.
SAMAPTI CHATTERJEE, J.
1. The issues to be determined in the present writ petition are :-
(i) Whether fee can be levied for the goods manufactured by the petitioners which is neither agricultural product nor is sold and marketed through the market point specified under the West Bengal "agricultural produce" Marketing (Regulation) Act, 1972 (hereinafter referred to as said Act) ?
(ii) Whether notices dated 9th August, 2006 and 5th April, 2007 are dehors the provision of the West Bengal "agricultural produce" Marketing (Regulation ) Act and are thereby null and void ?
(iii) Whether both impugned notices, imposing market fee on Plywood and Veneer are beyond the scope of the said Act of 1972 ?
(iv) Whether two products manufactured by the petitioners are products of agriculture, horticulture, sericulture, pisciculture, forestry or animal husbandry or any other produces specified to the schedule and therefore levy of fee on Plywood and Veneer is justified or not ?
Fact of The Case
2. The case of the petitioner in a nutshell is as follows :-
The petitioner no.1 is a company incorporated under Companies Act, 1956. The petitioner no.2 is a shareholder and director of the petitioner no.1. The petitioner no.1 carries on business of manufacturing Plywood and Veneer in and from its factory situated at Diamond Harbour Road, Bishnupur, South 24-Parganas. For purpose of manufacturing Plywood as well as Veneer petitioner imports timber logs from Malaysia and Mayanmar. Those timber logs are raw materials which are used for manufacturing Plywood and Veneer.
It is submitted that petitioner does not procure any raw material locally for the purpose of manufacturing activities and the entire raw materials are imported. It is revealed that for the purpose of manufacturing Plywood and Veneer those timber logs are processed at the factory of the petitioners and out of the said timber logs through the manufacturing process Veneer is obtained. Thereafter, the Veneer is further processed in a mechanical manner at the factory premises of the petitioners for the purpose of manufacturing Plywood. The said Plywood and Veneer which are manufactured at the factory of the petitioners thus are obtained purely by way of mechanical process and are neither "agricultural produce" nor fall in the category of any of the scheduled items under the West Bengal "agricultural produce" Marketing (Regulation) Act, 1972. Those Plywood and Veneer are excisable item, and the petitioners are regularly paying excise duties in accordance with law.
The petitioners are carrying on business from various branches all over India. After manufacturing those manufactured materials are transferred by way of stock transfer to various branches of the petitioners all over India for purpose of selling the same through its dealers. Therefore, it is evident that the goods manufactured by the petitioners are neither "agricultural produce" nor are sold and marketed through the market points specified under the said Act of 1972.
Sometime in the year 2004, an attempt was made by the respondent to impose market fee on the Plywood and Veneer manufactured by the petitioners. Against that the petitioners made representation before the concerned authority. On the basis of the representation the West Bengal Government on 20th January, 2005 exempted market fee on Plywood and Veneer vide a Notification no.169- M.W. & C/9M-49/2000. Thereafter again on the basis of the representation dated 11th February, 2005 the West Bengal Government exempted the market fees on Plywood and Veneer vide a Notification no.391-M.W. & C/9M-49/2000. On 9th August, 2006 Plywood was included in the schedule to the said Act of 1972. The items of Plywood was included under category XII (Miscellaneous). Against such inclusion on 15th July, 2006 the petitioners made a detailed representation wherein the petitioners refused to pay market fee on Plywood.
All on a sudden on 12/14th April, 2007 four trucks being nos. WB23-A-5581, AP 11-U2144
