Manakchand Nathuram Agrawal v. Krishi Upaj Mandi Samiti, Itarsi
1983-02-22
J.S.VERMA, M.D.BHATT
body1983
DigiLaw.ai
Judgement J. S. VERMA, J. :- The petitioner firm carries on business of a grain merchant and commission agent at Itarsi. The challenge in this petition under Art.226 of the Constitution is to the levy of market fee by the respondent Krishi Upaj Mandi Samiti, Itarsi, on the sale transactions of four items of agricultural produce, namely, Mungfali with or without Chilka, Til, Sarson and Binaulla. The rate of market fee prescribed is fifty paise per one hundred rupees of the price obtained in the transaction and is to be paid ordinarily by the purchaser of the agricultural produce, and in case he cannot be identified, by the seller. This levy is made under the provisions of the M. P. Krishi Upaj Mandi Adhiniyam, 1972 (No. 24 of 1973). 2. Shri M.C. Nihlani, learned counsel for the petitioner confined the attack to the levy of market fee on these four items of agricultural produce only on two grounds. His first contention is that the market fee being recoverable only on notified agricultural produce as defined in S.2(m), by virtue of Sec.19 (1) of the Act, and these items of agricultural produce not being so notified, there is no lawful authority for its recovery in respect of these items sold in the market area. The other contention of the learned counsel is that there is no quid pro quo for recovery of the market fee, which is a sine qua non of its validity. 3. The aforesaid first contention has no merit. Section 2 (m) of the Act defines 'notified agricultural produce' as any produce specified in the notification issued under Section 4. Section 3 of the Act provides for notification of the intention to establish a market for regulating purchase and sale of such agricultural produce and in such area as may be specified in the notification. Objections to the same received within a specified period are then to be considered and establishment of the market is required to be notified under S.4 of the Act. Section 4 of the Act provides for another notification by the State Government to establish a market for the area specified in the notification under S. 3 or any portion thereof for the purpose of this Act in respect of all or any of the kind of agricultural produce specified in the earlier notification.
Section 4 of the Act provides for another notification by the State Government to establish a market for the area specified in the notification under S. 3 or any portion thereof for the purpose of this Act in respect of all or any of the kind of agricultural produce specified in the earlier notification. Thus, Section 3 provides for notification of the intention to establish such a market and Sec.4 for notification establishing the market, after considering and deciding the objections and suggestions as may be received in response to the notification issued under S.3. Section 19 (1) of the Act empowers the Market Committee to levy market fee on notified agricultural produce brought for sale in the market area at such rates as may be fixed from time to time, subject to the minimum rate of fifty paise for every one hundred rupees of the price. As earlier stated, 'notified agricultural produce' on the sale of which, within the market area, market fees can be levied, is defined in S.2(m) as any produce specified in the notification issued under S.4. In the present case, the relevant notification under S.4 of the Act has been produced by the respondent and is at page 22 of the Paper Book. This notification was issued under the M. P. Agricultural Produce Market Act, 1960, which Act has been repealed under Sec. 82 of this Act, but the saving therein provides for continuance of the markets established, market areas declared and agricultural produce notified, etc., under the repealed Act. There is no dispute that this notification continues to be operative. A bare perusal of the same is sufficient to indicate that all the four aforesaid items of agricultural produce in respect of which this petition has been filed, are notified therein so as to satisfy the definition of 'notified agricultural produce' contained in Section 2 (m) of the Act. 4. Faced with this situation, Shri Nihlani has contended that the respondent has not produced the prior notification under Sec. 3, declaring the intention to constitute a market before it was so established by the subsequent notification establishing the market, which has been filed by the respondent. Learned counsel contends that this defect is sufficient to indicate that these items are not notified agricultural produce. It is difficult to accept this submission.
Learned counsel contends that this defect is sufficient to indicate that these items are not notified agricultural produce. It is difficult to accept this submission. The definition of notified agricultural produce in S.2 (m) refers to the notification under S.4 and not the earlier notification under S.3, which merely declares the intention to establish a market. It having been shown that all these four items of agricultural produce were duly notified so that they are notified agricultural produce, the first contention must be rejected. 5. The second contention of Shri Nihlani may now be considered. Shri Nihalani relied on a decision of this Court in Sajjan Mills Ltd. v. Krishi Upaj Mandi Samiti, Ratlam, 1981 MPLJ 117 : (AIR 1981 Madh Pra 30) to point out the essentials for upholding the validity of such a fee. Referring to the earlier decisions of the Supreme Court and the settled law on the point, it was reiterated in that decision that a substantial amount of the fee realised must be correlated to the services rendered to the person from whom the fee is charged, and where this proportion was 2/3rd or 3/4th of the collection made, the validity of the imposition of fees can be upheld, since the essential element of quid pro quo is made out in such cases. In that case, the market fee was raised from fifty paise per one hundred rupees of the price to rupee one per one hundred rupees of the price and it was the increase above fifty paise, which was challenged and was held to be invalid. The validity of imposition to the extent of fifty paise per one hundred rupees was not even challenged. The increase above fifty paise was quashed on account of the fact that its utilisation indicated its expenditure on items which were not correlated to the services rendered to the person from whom fee was charged. Apart from the fact that the amount of fifty paise per one hundred rupees of the price is the minimum prescribed by the statute, the amount is really so insignificant that not much scrutiny is required for determining the essential element of quid pro quo necessary to uphold the validity of this fee.
Apart from the fact that the amount of fifty paise per one hundred rupees of the price is the minimum prescribed by the statute, the amount is really so insignificant that not much scrutiny is required for determining the essential element of quid pro quo necessary to uphold the validity of this fee. The respondent has filed particulars of the expenditure incurred out of the amount so recovered which indicates that utilisation of most of the amount collected, has been on construction of buildings and providing amenities for the benefit of the purchasers coming to the market area and the facilities extended included even free telephone service to them. Having perused the items on which expenditure had been incurred by the respondent out of the market fees collected. We are satisfied that utilisation of at least 2/3rd, if not 3/4th or even more, of the amount collected is on items related to the service rendered to the purchasers of the agricultural produce in the market area. There is thus material to indicate presence of the element of quid pro quo essential to the validity of the levy. In our opinion, the levy of the market fees cannot be successfully challenged even on this ground. This contention also fails. 6. Consequently, the petition is dismissed. There will be no order as to Costs. The security amount be refunded to the petitioner.