RAMNATH LAXMINARAYAN v. W. N. MASODKAR, Inspector, Amravati Agriculture Produce Market Committee
1974-02-12
B.A.MASODKAR
body1974
DigiLaw.ai
JUDGMENT-These proceedings can be disposed of by a common order though the applicant in each case was accused of the offence under section 6(1) read with section 46 of the Maharashtra Agricultural Produce Marketing (Regulation) Act, 1963, upon a complaint lodged by the non-applicant No.1. 2. 'The material allegations in the complaint are similar though they differ in particulars thereof in that the applicants had acted in contravention of the provisions of section 6 (1) of the Act being brokers and having not obtained licences as required by the statute. In the complaints the transactions alleged against each of the applicants were disclosed and it is not necessary to extract the same from every case, except mentioning that it showed the transaction relating to sale of agricultural produce like gram, wheat etc. purchased from and given under bill numbers as well its respective dates and for whom the said purchase was made. In criminal complaint being Criminal Case No. 660/1972 in paragraph 5, the following allegations were made: "The accused has acted in contravention of the provisions of section 6(1) as he acted as a broker without licence in the following instances :- Purchase fromDateBill No.For whomCommodity & QuantityAmount Rs. P. Sukhdeo17-8-7115004ShamlalChana1,371.95 RatanlalJagannathDal SakkarPulgaonBags SethDistt.11. AmraotiWardha. Sukhdeo18-8-7115061MadhukarWheat962.78 RatanalShamsio10 ChandraBags District Chanda 1509015 Bags of Wheat1,304.30 15167Mahadeo Ambiya DarvaChana dal 11, Bags1,377.80 Similar statements are found against each of the applicants in the respective complaints. 3. When the charge was explained to each of the accused, it appears that they passed on a pursis not disputing the said material facts stated against them. The pursis given in each of these cases reads as follows:- "Accused admits that he has done the transaction mentioned in the complaint as broker with a qualification that these transactions were between trader and trader." After this pursis was entered into, the trial Judge found that the activity was carried on by the accused and there was breach of section 6 (1) of the Act and held each of them guilty. Accordingly, he imposed a sentence of fine of Rs. 75 against each of them.
Accordingly, he imposed a sentence of fine of Rs. 75 against each of them. Revision Applications were filed before the Additional Sessions Judge, Amraoti, raising a plea that' the provisions of the Act were not attracted to the transactions of the nature admitted by the accused, the same having been entered as broker acting between trader and trader and there being no relationship of principal and agent at any time. After considering the provisions of the Act, the learned Additional Sessions Judge refused to interfere. It is against these orders that the present revisions have been presented. 4. A submission of somewhat interest and importance is made on behalf of all these applicants by the learned counsel Mr. Palshikar to the effect that if a close look is taken to the provisions of the Maharashtra Agricultural Produce Marketing (Regulation) Act, 1963 and the Maharashtra Agricultural Produce Marketing (Regulation) Rules, 1967, it would indicate that the activity of a person, who, merely brings a trader and a trader together and the parties themselves negotiate and enter into, the transaction of the and purchase and only for the purpose of bringing them together such a person charges fees or commission and, who, by the very nature of transaction, cannot have any interest in the transaction or any dispute arising out of it, is not prohibited from carrying such an activity. He further submits that the inhibition was against a broker as understood by the provisions of the Act and, therefore, unless there is an element of agency, the accused cannot be held culpable. He placed reliance for founding the submissions on the provisions of sections 2 (c), 6 and 7 and the Rules prescribing the form of licence. He submits that there is inherent evidence in all these provisions to indicate that the activity of bringing two willing traders together who may ultimately deal in the marketing produce and for such bringing them together if any fee is earned, is not an activity which requires a licence nor is regulated. In fact, he submits that such an activity is permissive one. 5. The learned counsel points out that the nature of the activity which these applicants carry on is stated on affidavit in the following manner: "The applicant carries on his business as middle man.
In fact, he submits that such an activity is permissive one. 5. The learned counsel points out that the nature of the activity which these applicants carry on is stated on affidavit in the following manner: "The applicant carries on his business as middle man. He does not act for any principal, put, merely brings together seller and buyer and accepts remuneration from both, he is not a broker as defined by the Act. Whenever he finds a seller and also a purchaser, he brings them together and the contract is between the seller and purchaser, the applicant does out come into the picture at all. In case of any dispute the applicant is out concerned. He does out act as an agent of either the seller or the buyer as his principal. He accepts his remuneration from both the parties." Relying on this nature of the activity, the learned counsel submitted that this is not an activity which answers the term 'broker', or answers the terms of section 6 as are inhibited activity in market area. 6. Now, all these submissions are really not available to the present applicants. In the pursis, which is quoted above, in clear terms, the applicants admit that they acted as brokers between trader and trader. The paragraph of the affidavit filed in this Court and quoted above, dearly shows that they were acting as middlemen bringing two traders together and charging fees or commission from both the sellers and the purchasers, or both the traders. Thus, the activity is clearly for the purpose of marketing the goods, which may result in the sale and purchase thereof. 7. The provisions on which reliance was placed being section 2 (c) are in the following terms: "broker" means an agent who contrives, makes and concludes a bargain or contract on behalf of his principal for the purchase or sale of agricultural produce for which he receives a fee or remuneration, but does not receive, deliver, transport, or pay for the purchase, or collect payment for the sale, of the agricultural produce," This provision takes in the activities of the person who acts for effecting purchase or sale of agricultural produce belonging to others and such an activity is for consideration, being fees or remuneration. The definition is obviously couched in wider language and has both positive and negative aspects.
The definition is obviously couched in wider language and has both positive and negative aspects. The qualifying verbs 'contrives', 'makes', or 'concludes' appear to have been purposefully used to cover all stages of negotiations and conclusions of contracts. A further scrutiny of the provision of this section would show that these terms must be understood in their generic plain sense. Literal meaning of the word 'contrive' is "to plan, to bring about or effect, to manage, arrange; to plot; to conceive," (Chamber"s Twentieth Century Dictionary page 282, New Edn. 1972) ; "to invent, devise, excogitate with ingenuity and cleverness (any plan or purpose), to find out or discover (as the solution of a problem or riddle) : to come to understand" (The Oxford English Dictionary Volume II, 1933 Edn. page 926). Therefore, the activity of persons who bring about the transaction of sale or purchase of agricultural produce belonging to others and in which they have no ownership interests are very much indicated and included in the definition itself. Such persons obviously do not receive, deliver, transfer or pay for the purchase nor collect for themselves the same as is shown by the latter part of the definition itself. To be a broker, therefore, it is not necessary that the person acting as such must either receive the goods or deliver it to the other person or make the payment for the purchase or be responsible for collecting the payment of the same. It is enough if he is acting for someone by bringing traders together for the purpose of sale of agricultural, produce. "To contrive" means to take in the steps required to bring the traders together for the sale or purchase of such goods. It is not necessary in every case that such an agent must· make or conclude the bargain or the contract. By bringing the willing parties together is enough if that results in marketing of goods as the definition would be fully answered. Legislative use of the verb 'contrive', has its own wide range of activities that are commonly carried on by the persons who are brokers in commercial field. For, the purpose of the transaction that ultimately results in a sale or purchase of the agricultural produce, such a person would obviously become the agent of one or the other or of both.
For, the purpose of the transaction that ultimately results in a sale or purchase of the agricultural produce, such a person would obviously become the agent of one or the other or of both. That term "agent" will have to be understood in the context it is used and such persons bringing the traders together for effecting the sale and purchase of the agricultural produce for consideration for the purpose of the Act are well within the contemplation of the legislative premises indicated by the term 'broker'. By the use of negative part of definition, the distinction that a principal does not sell to his agent is, brought into relief expressly providing for the same. Needless to emphasise that the concept of agency is very wide one and is indicative of the persons employed t. do any act for another in' dealing with third person. 8. The definition requires that such an employment or engagement should be for consideration, which such a person receives by way of fees or rumination. It is not disputed that unless such a, person bring seller and purchaser together for the purpose of sale or purchase of agricultural produce and marketing of such articles takes place, he is not entitled to fees or remuneration. 9. That being the position, even on the definition that is available ill the statute, i.e., section 2 (c), the activity admittedly carried on by these applicants answers fully the requirements of the definition of a broker. 10. That apart, the provisions of section 6 of the Act themselves indicate that every one concerned with the marketing of the declared agricultural produce must operate under a licence. The provisions relevant for the purpose indicate this eminent anxiety on the part of Legislature.
10. That apart, the provisions of section 6 of the Act themselves indicate that every one concerned with the marketing of the declared agricultural produce must operate under a licence. The provisions relevant for the purpose indicate this eminent anxiety on the part of Legislature. Section 6 (1) (a) and (b) reads as follows: - "(1) Subject to the provisions of this section and of the rules providing for regulating the marketing of agricultural produce in any place in the market area, no person shall, on and after the date on which the declaration is made under sub-section (1) of section 4, without, or otherwise than in conformity with the terms and conditions of a licence (granted by the Director when a Market Committee has not yet started functioning; and in any other case, by the Market Committee) in this behalf- (a) use any place in the market area for the marketing of the declared agricultural produce, or .. (b) operate in the market area or in any market therein as a trader, commission agent, broker, processor, weigh-man, measurer, surveyor, warehouseman or in any other capacity in relation to the marketing of the declared agricultural produce." (emphasis provided.) This provision takes in all activities carried on in the market area, and for the purpose of regulating the same requires licensing the object of the same being the marketing of agricultural goods. The Canvass of concerned activity is indicated by the terms like trader, commission agent, broker, processor, weigh-man, measurer, surveyor, warehouseman and further by enacting the words in any other capacity. Even applying the rule of construction of ejusdem generis to these words 'in any other capacity', it is, obvious that all these activities in whatever from but which are akin to the activities of trader, commission agent, broker etc. expressly defined in the Act are within the ambit of section 6 (1) of the Act. Therefore, though a person may not strictly answer definition of the term 'broker' or such description but is found to deal with the marketing of the declared agricultural produce, in that bringing two traders in the marketing area together for the purpose of sale and purchase of such goods, his activity cannot be excepted from the contemplation of section 6 (1) of the Act and cannot be carried on unless such person holds a valid licence.
Any other approach bristles with possibilities of leaving loopholes in the legislative scheme of section 6 itself. 11. The definition of the term 'trader' (section 2 (t)) is as under: “"Trader" means a person who buys or sells agricultural produce, as a principal or as duly authorised agent of one or more persons." Therefore, whenever a person buys or even sells for himself or for others is treated as a trader. So by merely saying that two persons were brought together as traders, cannot obviate the regulations imposed by section 6 (1) of the Act. A person who buys and that who sells are both "traders". So also one who buys or sells for others as such an authorised agent is also a "trader", Those who bring such persons together and charge fees or commissions would obviously answer the terms of "broker" and such activity which is concerned with the marketing of the declared agricultural marketing produce being one akin to that of commission agency or any other types indicated by the earlier part of sub-section (b) of sub-section (1) of section 6, will have to be treated as one that is sought to be regulated. There is no reason to limit the words and the meaning thereof in any manner. 12. A reference was made to section 7 (2) and it was said that the activity between trader and trader cannot be prohibited by licences and, therefore, section 6 (1) should be read subject to section 7 (2) of the Act. 13. A plain reading of section 7 (2) negatives such a contention. That provision deals with the grant of licences and prescriptions of forms. While dealing with the terms and conditions and restrictions including the provisions for prohibiting the brokers or commission agents from acting in transactions both as buyer or on behalf of both the buyer and seller, and also provision for prohibiting brokers from acting in any transaction, except between a trader and trader, in respect of agricultural produce, which also includes prescribing the manner of auctions of agricultural produce and place and mode, the weigh-men and charging of fees, it is indicated how the terms of these forms should be made. The provisions are clearly enabling one and cannot be read as creating new rights so as to enable the brokers from acting without licence.
The provisions are clearly enabling one and cannot be read as creating new rights so as to enable the brokers from acting without licence. It simply states while acting as a broker between a trader and trader, what should be the prescription under the terms of the rules. 14. Provisions of section 7 (2) themselves thus are clearly enabling and the words 'except between a trader and trader' are the part of that part of provisions which permits imposition of prohibition qua brokers acting in any transaction in respect of agricultural produce other than poultry, cattle sheep and goats and such other agricultural produce as may be prescribed. It has nothing to do with the subject of section 6 (1) of the Act. Rule 8 of the Rules may be referred to which makes the employment of broker or commission agent not compulsory for the purpose of operating in any market area. Sub-rule (2) of rule 8 of the Rules negatively states: "No broker shall be employed in relation to marketing of any declared agricultural produce, except in relation to marketing……. (a) of poultry, cattle sheep and goats, or (b) of any declared agricultural produce by a trader with another trader." If, therefore, there is a broker, he can be only engaged in relation to marketing if goods indicated by sub-clauses (a) and (b) of sub-rule (2) of rule 8 of the Rules. Thus, it is permissive activity fur a broker to bring traders together for the purpose of marketing the declared agricultural produce under the Rules. Form No 1 which is common form of licence for the purpose of operating as a trader, commission agent or broker, also indicates the same said result. Clause 16 of that form shows that the licensee can operate as a broker only in respect of poultry, cattle, sheep and goats or except between trader or trader. Provisions of section 7 (2), therefore, are merely indicative or' the activities of the broker which may not be restricted by prescribing terms in such "a form.
Clause 16 of that form shows that the licensee can operate as a broker only in respect of poultry, cattle, sheep and goats or except between trader or trader. Provisions of section 7 (2), therefore, are merely indicative or' the activities of the broker which may not be restricted by prescribing terms in such "a form. The argument, therefore, that sub-section (2), of section 7 controls the provisions of section 6 (1) of the Act relating to regulation of marketing of agricultural produce and the broker bringing together a trader and trader for the purpose of sale or purchase of the agricultural produce is not required to be licensed; cannot at all stand the test of scrutiny. 15. That being the position, a person like the applicant in each case, who carries on the activity in the market area of bringing a trader and trader together for the purpose of marketing the declared agricultural produce must possess the licence prescribed by section 6. It is admitted even on the showing of the accused that they were dealing with the activity with respect to the declared agricultural produce and further were engaged in bringing a trader and trader together and that too for consideration, in that they were entitled to charge commission or fee from both seller as well as purchaser. Clearly, therefore, their activity was within the prescription of section 6 (1)(b) of the Act. Consequently, that activity was subject further to the licences required to be taken as provided by the Act. It is admitted position that they had not taken such licences and, therefore, they were rightly held culpable. 16. This being the only submission, no interference is called for in any of the applications and the same shall stand dismissed. Revision application dismissed.