IMPORTANT POINT
When notified agriculture produce was brought within the market area where end user was manufacturer, levy of market fee was not attracted under M.P. Krishi Upaj Mandi Adhiniyam.

JUDGMENT

Arijit Pasayat, J. - The Civil Appeal and the Transfer Petition are inter-linked and are taken together for disposal.

2. Background facts involved are essentially as follows:

A writ petition was filed by the appellant under Article 226 of the Constitution of India, 1950 (in short the Constitution) before the Madhya Pradesh High Court. The basic stand of the appellant was that it is not eligible to pay any market fee under the M.P. Krishi Upaj Mandi Adhiniyam, 1972 (hereinafter referred to as the Act). Before the High Court it was projected that appellant is a Public Limited Company having its registered Head Office at Brajrajnagar (Orissa) and has a paper manufacturing plant at Amlai in the district of Shahdol in State of Madhya Pradesh. The appellant -company uses bamboos, wood dyes, starch rosin, talcum and several chemicals as raw material for production of paper. The manufacturing process consists of crushing bamboos and wood pieces into pulp to which chemicals are added at a subsequent stage. Elaborate description was given how the manufacturing process takes place. It was paying without any demur the market fee to the Mandi Samiti whenever the appellant bought or sold any agricultural produce either within the market area or the market yard. It had never disputed the liability to pay such fee for purchase made in the area in question. No market fee is payable on the agricultural produce when they are neither bought or sold or brought into the market area for the purpose of sale. Appellant has been getting the agricultural produce from outside the State to its manufacturing unit at Amlai for being used as one of the raw material and hence, the same would not be covered under the provisions of the Act. It is not disputed that the Bamboo as well as the wood are specified agricultural produce within the meaning of the Act.

3. Stand of the appellant was that when it brought the agricultural produce a demand was raised in exercise of power under the Act that it has been brought inside the market area for the purpose of process on the ground that Amlai Paper Mills is included within the area of the respondent Mandi Samiti, Budhar. A notice was issued by the Director, Krishi Upaj Mandi Samiti, Budhar to which the appellant has filed his show-cause. It was also averred that the Director, Krishi Upaj Mandi Samiti issued a general circular fixing the liability of persons who are liable to pay the market fee. At that juncture, the appellant moved the High Court by filing a writ petition challenging the view taken by the authorities in the matter.

4. The writ petition was resisted by the State and the Market Committee, inter-alia, taking the stand that the levy of market fee is in order. The High Court upheld the stand of the State and the Committee and dismissed the writ petition.

5. In support of the appeal, learned counsel for the appellant submitted that the levy can be made only in respect of the notified agricultural produce which is brought into market areas for processing. In the instant case, the notified agricultural produce brought inside the market area is not used for the purpose of processing, and the end-user is manufacturer. Therefore, the High Court has clearly erred in holding that the Market Committee was authorized to levy market fee.

6. Per contra, learned counsel for the Market Committee and the State submitted that the end user may be manufacturer, but in the process of manufacture processing is involved and, therefore, the levy is in order.

7. Though reference was made to a decision of this Court in Krishi Upaj Mandi Samiti and Ors. v. Orient Paper & Industries Ltd. (1995 (1) SCC 655) by learned counsel for the respondents, the issue really has no relevance so far as the present dispute is concerned.

8. The stand of the respondent further is that in the process of manufacture bamboo is processed to pulp which is primary raw material for the purpose of manufacture of paper.

9. In order to appreciate the