IMPORTANT POINT
Market fees under the Tamil Nadu Agricultural Marketing (Regulation) Act, 1987, cannot be levied on agricultural produce imported for processing or export unless it is not processed or exported within 30 days, which creates a presumption of sale in the notified market area.

ORDER :

Prayer: Writ Petition filed under Article 226 of the Constitution of India, praying to issue a Writ of Mandamus, directing the respondents 4 and 5 to forbear from levying 1% market fee on the cashew nuts imported by the petitioner from foreign countries, and further direct the said respondents to refund forthwith the amount unauthorisedly collected to a tune of Rs. 16,00,178/- (Rupees Sixteen Lakhs One Hundred and Seventy Eight only).

1. This Writ Petition has been filed for issuance of Writ of Mandamus, forbearing the fourth and fifth respondents from levying 1% market fee on the cashew nuts imported by the petitioner from the foreign countries and for a further direction to the respondents to refund the sum of Rs. 16,00,178/- (Rupees Sixteen Lakhs One Hundred and Seventy Eight only), that was collected from the petitioner towards the market fee.

2. The case of the petitioner is that he is the Proprietor of an Agency, which is involved in the business of importing raw cashew nuts from other Countries, which is processed in the Factory and the processed cashew nuts are sold across India. The petitioner is also the Managing Director of another Company, which is involved in the same business.

3. The further case of the petitioner is that the cashew nut is an agricultural produce, which is notified under the Tamil Nadu Agricultural Marketing (Regulation) Act, 1987 (hereinafter referred to as “the Act”).

4. The market fee can be levied under the Act only when the agricultural produce is bought or sold in the notified market area. The grievance of the petitioner is that the agricultural produce is imported by the petitioner and it is processed and thereafter, it is exported to the Foreign Countries and therefore, the petitioner is not liable to pay the market fees for the cashew nuts imported from the Foreign Countries. However, the fourth respondent was unauthorizedly collecting the market fee from the petitioner, by intercepting the vehicle every time and in the said process, the sum of Rs. 16,00,178/- (Rupees Sixteen Lakhs One Hundred and Seventy Eight only) was collected from the petitioner during various times from the years 2015 to 2021. It is under these circumstances, the present Writ Petition has been filed before this Court to forbear the fourth and fifth respondents from levying market fees and for refund of the market fee that was unauthorizedly collected from the petitioner.

5. The fourth respondent has filed a counter affidavit. The fourth respondent has taken a stand that the petitioner was involved in sale of cashew nuts in the notified market area and therefore, the market fee was levied from the petitioner. Therefore, the fourth respondent has justified the collection of the market fee from the petitioner and has sought for the dismissal of this Writ Petition.

6. Heard the learned counsel on either side.

7. On carefully going through the Scheme of the Act, the levy of fees by the Market Committee is dealt with under Section 24 of the Act. In other words, Section 24 is the charging Section, which entitles the Market Committee to levy the fees. In order to justify the levy of fees by the Market Committee, the following conditions must be satisfied:

“(i) The agricultural produce must form part of the schedule as defined under Section 2 (1) of the Act.

(ii) The agricultural produce must be marketed in a declared notified area, which is dealt with under Sections 3 and 4 of the Act.

(iii) In the notified area, the Government should issue a Notification and identify the notified market area for the purposes of the Act.

(iv) The agricultural produce must be bought or sold in the notified market area and in which event, the Market Committee established under Section 5 of the Act, is entitled to levy a fee of 1%.”

8. In the instant case, the cashew nuts in all forms is an agricultural produce that comes within the schedule. Kanyakumari District is a notified area as per G.O. (Ms) No. 777, Food and Agriculture, dated 09.03.1964.