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1996 DIGILAW 1175 (SC)

Sasa Musa Sugar Works v. State Of Bihar

1996-07-06

B.L.HANSARIA, G.N.RAY

body1996
JUDGMENT G.N. Ray, J.-These appeals and the special leave petition involve common question of law and they arise out of the common judgment dated January 20, 1994, passed by the Division Bench of the Patna High Court. By the impugned judgment, the Division Bench of the Patna High Court allowed in part the Writ Petitions filed by several sugar mills of Bihar challenging the validity of Section 4A and 4B inserted by the Bihar Agricultural Produce Markets (Amendment) Act, 1993; Section 33M as inserted by the Bihar Agricultural Produce Markets (Amendment) Act, 1992; notification dated August 31,1992 issued under Section 4 of the Bihar Agricultural Produce Markets Act, 1960 (hereinafter referred to as the Markets Act), and also challenging the validity of imposition of market fee under the Markets Act in view of exemption of all the sugar mills in Bihar from the provision of Section 15 of the Markets Act under notification dated March 22, 1976. The High Court on the basis of respective contention of the parties in the said Writ Petitions formulated the following points for the decision of the Court: (a) Whether sub-section (1) and (2) of Section 4A is valid or constitutional so far as prospective part of the same is concerned? (b) If answer to (a) is in the affirmative, whether the said provisions are valid and constitutional so far as the retrospective part of the same is concerned? (c) Whether Section 4B is valid and constitutional ? (d) Whether Section 33M of the Markets Act as introduced by amendment of 1992 is valid and constitutional ? (e) Whether Rule 68 (iii) of the Bihar Agricultural Produce Markets Rules (hereinafter referred to as the Rules) as inserted by Notification No. 4 dated November 30, 1992 is valid? (f) What is the effect of grant of exemption made under Section 15 of the Markets Act ? (g) What is the effect of Bihar Ordinance No. 8 of 1988 having lapsed so far as levy of market fee is concerned? (h) Whether a limited and restricted meaning can be given to the expression agricultural produce by excluding the industrial products produced by industry from the scope and ambit of the Markets Act ? (i) Is the Notification dated June 31, 1992 a valid Notification under Section 4 of the Markets Act ? 2. (h) Whether a limited and restricted meaning can be given to the expression agricultural produce by excluding the industrial products produced by industry from the scope and ambit of the Markets Act ? (i) Is the Notification dated June 31, 1992 a valid Notification under Section 4 of the Markets Act ? 2. The High Court by the impugned judgment answered the said points formulated by it in the following manner : (i) Neither sub-section (1) nor sub-section (2) of Section 4A is valid or constitutional prospectively. Both the sub-sections are ultra vires of Articles 14 and 19(1)(g) of the Constitution and not protected by Article 19(6) of the Constitution. (ii) Even if it is assumed that prospective part of Section 4A is valid, the retrospective part is ultra vires of Articles 14 and 19(1)(g) of the Constitution. (iii) Section 4B is partly valid and partly invalid. Section 4B can be divided into four parts. The first part of Section 4B is invalid and cannot be given effect to. The second part is valid and can be given effect to. The third and fourth part of Section 4B are merely ancillary and consequential to first and second part. (iv) Section 33M of the Markets Act as sought to be introduced by the Amending Act of 1912 by replacing the amending Ordinances is invalid and ultra vires the Constitution. The said legislation lacks legislative competence. (v) Rule 68(iii) of the Rules is invalid in view of the invalidity of Section 33M. (vi) The grant of exemption made under Section 15 of the Markets Act so far as sugar is concerned, does not affect the applicability of the other provisions of the Act, rules and by laws, if they are otherwise valid and applicable. (vii) Bihar Ordinance No. 8 of 1988 having lapsed, the rate of market fee provided under Section 27 of the Act before the Ordinance No. 8 of 1988 was promulgated, revived. The rate will be Re. 1/- and it will continue to be so until and unless it is modified according to law. (viii) No limited or restricted meaning can be given to the expression "agricultural produce" by excluding industrial products from the ambit of the Markets Act. The rate will be Re. 1/- and it will continue to be so until and unless it is modified according to law. (viii) No limited or restricted meaning can be given to the expression "agricultural produce" by excluding industrial products from the ambit of the Markets Act. (ix) In view of the decisions on various points formulated, no opinion need be expressed on the validity of Notification dated June 31, 1992 issued under Section 4 of the Markets Act. 3. For the purpose of appreciating the rival contentions of the parties, the following facts need be noted : (i) On August 6, 1960, the Markets Act, 1960 (Act No.16 of 1960) came into force and at the time of enforcement of the said Act, sugar was one of the scheduled items in respect of which the provisions of the Markets Act were made applicable. On March 22, 1976, all sugar mills were exempted from the provisions of 15 of the Markets Act. (ii) By Notification dated May 2, 1977 bearing No. SO 75, sugar and some other items were deleted from the Schedule under the Markets Act in exercise of the power under Section 39 of the Act. (iii) On May 21, 1977, by another Notification bearing No. 857, issued in exercise of power under Section 39, the previous Notification dated May 2, 1977 was cancelled. (iv) Till July 23, 1976, four notifications were issued under Section 39 of the Markets Act by which various items like rice bran, milk (only liquid milk) etc. were deleted from the Schedule under the Act. (v) Section 27 of the Markets Act was amended by Bihar Ordinance No. 8 of 1988 by substituting the word "at the rate of rupee one". This Ordinance elapsed subsequently. (vi) The Notification dated May 21, 1977 issued under Section 39 of the Markets Act cancelling the earlier notification dated May 2, 1977 (by which sugar was deleted from the Schedule under the Markets Act) was challenged in a series of Writ Petitions filed before the Patna High Court. Such Writ Petitions were disposed of by a common judgment dated March 30, 1992. Such decision has been reported in Delhi Cloth and General Mills Company and others v. Agricultural Produce Market Committee and others (AIR 1993 Patna 43). Such Writ Petitions were disposed of by a common judgment dated March 30, 1992. Such decision has been reported in Delhi Cloth and General Mills Company and others v. Agricultural Produce Market Committee and others (AIR 1993 Patna 43). The question raised before the Patna High Court in the said Writ Petitions was as to whether or not the cancellation of the earlier notification by the subsequent notification dated May 21, 1977 had the effect of restoring the situations prevailing prior to May 2, 1977. 4. The High Court considered the following questions raised before it, namely : (a) Whether or not the Notification dated May 21, 1977 cancelling the earlier Notification dated May 2, 1977 automatically restored the state of affairs which had existed prior to May 2, 1977; and, if it did so, then did it mean that sugar was automatically included in the Schedule under the Markets Act and became subjected to levy of market fee as "agricultural produce" in "the specified area" under the Act ? (b) Even if it is assumed that Notification dated May 21, 1977 validly cancelled the earlier Notification dated May 2, 1977 which resulted in the inclusion of sugar in the Schedule, was it necessary that procedure etc. contemplated by Sections 3 and 4 of the Act had to be applied afresh before levying market fee ? 5. The High Court, inter alia, held that Notification dated May 21, 1977, even though cancelled the earlier Notification dated May 2, 1977, did not tantamount to an automatic revival of sugar being an item in the Schedule. For including sugar as an item in the Schedule of the Markets Act, positive action of issuing separate notification adding sugar in the Schedule was necessary. The High Court also held that even if it was assumed that the effect of notification dated May 21, 1977 was to add sugar in the Schedule of the Markets Act, such inclusion did not authorise imposition of market fee under Section 27 of the said Act because it was necessary to comply with the requirements under Sections 3 and 4 of the Markets Act before including any item in the Schedule of the Markets Act. (vii) The Bihar State Agricultural Marketing Board filed Special Leave Petition No. 9529/92 before this Court impugning the said judgment passed by the High Court. (vii) The Bihar State Agricultural Marketing Board filed Special Leave Petition No. 9529/92 before this Court impugning the said judgment passed by the High Court. Such special leave petition was admitted but no stay order was granted by this Court. (viii) On May 23, 1992, Memo No. 3027 dated May 12, 1992 issued under Section 39 of the Markets Act adding sugar to the Schedule under the Markets Act, was published in the Bihar Extraordinary Gazette. (ix) By Notification no GSR 40 dated November 30, 1992 sub-rule (iii) of Rule 68 of the Rules framed under the Markets Act was inserted by which every market committee was required to transfer 20 of the total receipt to the State Fund. (x) On October 13, 1992, an Ordinance, Known as Bihar Agricultural Produce Markets (Second Amendment) Ordinance 1992, was promulgated. The said Ordinance being Ordinance No. 25/92 was repealed on February 3, 1993 and in its place the Bihar Agricultural Produce Markets (Amendment) Act, 1993 was enacted. By the said Amending Act, Section 4A and 4B were inserted in the Markets Act. (xi) The Market Committees issued notices to the Sugar Mills in view of the amendment of the Act incorporating Sections 4A and 4B. 6. It will be appropriate at this stage to refer to Sections 3, 4, 4A, 4B, 15, 33M and 39 of the Markets Act : 3. Notification of intention of exercising control over purchase, sale, storage and processing of agricultural produce in specified area-(1) Notwithstanding anything to the contrary contained in any other Act for the time being in force, the State Government may, by notification, declare its intention of regulating the purchase, sale, storage and processing of such agricultural produce and in such area, as may be specified in the notification. (2) A notification under sub-section (1) shall state that any objection or suggestion which may be received by the State Government within a period of not less than two months to be specified in the notification, shall be considered by the State Government. 4. (2) A notification under sub-section (1) shall state that any objection or suggestion which may be received by the State Government within a period of not less than two months to be specified in the notification, shall be considered by the State Government. 4. Declaration of market area.-(1) After the expiry of the period specified in the notification issued under Section 3 and after considering such objection and suggestions as may be received before such expiry and after holding such enquiry as it may consider necessary, the State Government may by notification, declare the area specified in the notification under Section 3 or any portion thereof to be a market area for the purposes of this Act, in respect of all or any of the kinds of agricultural produce specified in the notification under Section 3. (2) On and after the date of publication of the notification under sub-section (1), or such later date as may be specified therein, no municipality or other local authority, or other person, notwithstanding anything contained in any law for the time being in force, shall, within the market area, or within a distance thereof to be notified in the official Gazette in this behalf set up, establish, or continue, or allow to be set up, established or continued, any place for the purchase, sale, store or processing of any agricultural produce so notified, except in accordance with the provisions of this Act, the rules and by laws. Explanation-A municipality or other local authority or any person shall not be deemed to set up, establish or continue or allow to be set up, establish or continue a place as a place for the purchase, sale, storage or processing of agricultural produce within the meaning of this section, if the quantity is as may be prescribed and the seller is himself the producer of the agricultural produce offered for sale at such place or any person employed by such producer to transport the same and the buyer is a person who purchases such produce for his own use or if the agricultural produce is sold by retail sale to a person who purchases such produce for his own use. (3) Subject to the provisions of Section 3, the State Government may at any time by notification exclude from a market area any area or any agricultural produce specified therein or include in any market area or agricultural produce included in a notification issued under sub-section (1). (4) Nothing in this Act shall apply to a trader whose daily or annual turnover does not exceed such amount as may be prescribed. 4A. Sections 3 and 4 not to apply to Section 39-(1) The provisions of Sections 3 and 4 shall not apply to the exercise of powers by the State Government under Section 39 to amend the schedule by addition of any item of agricultural produce not specified therein. (2) The State shall not order the deletion of any item in exercise of its power under Section 39 without giving an opportunity for hearing to the affected parties. 4B. Validating of market fee levied and collected-Notwithstanding any judgment, decree or order of any Court to the contrary, any market fee levied and collected shall be deemed to be valid as if such levy and collection was made under the provisions of this Act as amended by this Act and notification No.730 dated 2nd May, 1977 shall be deemed never to have been issued and no suit or other legal proceedings shall be maintained or contained in any Court for the refund of the fee collected under the provisions of this Act and no Court shall entertain any proceedings challenging the fee merely on the ground that liability had ceased on the issuing of the notification No.730, dated May 2, 1977." 15. Sale of agricultural produce-(1) No agricultural produce, specified in notification under sub-section (1) of Section 4 shall be bought or sold by any person at any place in the market area other than the relevant principal market yard or sub-market yard or yards established therein except such quantity as may on this behalf be prescribed for retail sale or personal consumption. (2) The sale and purchase of such agricultural produce in such area notwithstanding anything contained in any law be made by means of open auction or tender system except in cases of such class or description of produce as may be exempted by the Board. 33M. (2) The sale and purchase of such agricultural produce in such area notwithstanding anything contained in any law be made by means of open auction or tender system except in cases of such class or description of produce as may be exempted by the Board. 33M. Every Market Committee shall out of its fund contribute to the State Government Fund such percentage of its income derived from licence fees and market fees as may be prescribed by Rules from time to time by the State Government. 39. Power to amend the Schedule-The State Government may, by notification, add, amend or cancel any of the items of agricultural produce specified in the Schedule." 7. The reasonings indicated by the High Court in deciding the vires of Section 4A and 4B of the Markets Act as contained in the impugned judgment may be broadly indicated as hereunder : (a) Notification dated May 21,1977 cannot be treated as re-introduction of sugar in the Schedule without the requirement of Sections 3 and 4 of the Markets Act which are valid and operative having been complied with. Even if Section 24 of the Bihar General Clauses Act is treated as applicable, it will have the effect of adding sugar in the Schedule; but without a proper notification under Sections 3 and 4 of the Markets Act, the regulatory provisions for fee were not applicable merely because sugar was added in the Schedule. (b) Validating/Amending Act of 1993 introducing Sections 4A and 4B into the Markets Act after Section 4, could not have the effect of making the Act applicable to sugar under Notification dated May 21, 1977 in view of the fact that Sections 3 and 4 still remained integral and vital parts of the Markets Act and compliance of Sections 3 and 4 was essential. (c) The scheme of the Markets Act is an integrated one and mere introduction of a commodity into the Schedule will not proprio vigore attract the provisions of the Act without following the provisions of Sections 3 and 4 of the Act. (c) The scheme of the Markets Act is an integrated one and mere introduction of a commodity into the Schedule will not proprio vigore attract the provisions of the Act without following the provisions of Sections 3 and 4 of the Act. (d) The Validating/Amending Act had merely the effect of making Sections 3 and 4 of the Act not applicable to action taken under Section 39 of the Act, but having regard to the continuance of Sections 3 and 4 of the Act, other provisions of the Act cannot be made applicable merely because of the re-introduction of sugar into the Schedule. To make the Act applicable to the items added by Notification dated May 21, 1997, there must have been a fresh notification under Sections 3 and 4 of the Act. (e) Sections 3 and 4 of the Act constitute the core of the Act for the application of the provisions of the Act, which mandates fresh notification before the Act is made applicable to items included in the Schedule. After the commencement of the Act, introduction under Section 39 cannot achieve that purpose. A notification under Section 3(1) is not a mere notification introducing agricultural produce under the Schedule of the Act but the said notification is also concerned with prescribing the area within which the agricultural produce will have to be sold and purchased. Notification under Section 4 can be brought into existence only after considering the objections presented under Sections 3 and 4 of the Act, pursuant to the notification issued under Section 3(1) of the Act. The introduction of a commodity into the Schedule of the Markets Act must be combined with notification under Section 4(1) of the said Act. The requirements under Sections 3 and 4 of the Act must be complied with together and they cannot be severed. It is only after issuance of notification under Section 4(1) of the Act that the fee leviable under the Act becomes payable. (f) Section 27 of the Act is wholly dependent upon a notification under Section 4(1) of the Act because levy of market fee can be made only an agricultural produce bought or sold in the market at the specified rates. (f) Section 27 of the Act is wholly dependent upon a notification under Section 4(1) of the Act because levy of market fee can be made only an agricultural produce bought or sold in the market at the specified rates. As Section 4(1) of the Markets Act still remains operative and has not been excluded, mere inclusion of a commodity under Section 39 of the Markets Act will not ipso facto attract other provisions of the Act. (g) Sections 4A and 4B are invalid as they constitute two different procedures, namely, the procedure for items which are added subsequent to the commencement of the Act and the procedure which has to be followed in the case of the items aiready included in the Schedule. There cannot be two separate procedures for the items existing prior to August 6, 1960 and those which are added subsequently. Accordingly, the provisions for non-application of Sections 3 and 4 of the Markets Act by Section 4A(1) of the Act, is arbitrary, without intelligible basis and has the effect of destroying the Scheme of the Markets Act. Any contention that Sections 3 and 4 of the Markets Act will not apply to an item which is added in the Schedule will make mockery of the entire Act. Section 4A purports to destroy the entire fabric of the Act. Therefore, Section 4A(1) of the Act has to be struck down to keep the other provisions of the Act alive. (h) Sections 4A and 4B introduced by the Amending Act violate Articles 14 and 9(1)(g) of the Constitution. The said Sections 4A and 4B create two separate classes for the application of the Act, one for those who would be traders in the area concerned and the other for the market committee. (i) Section 4B is partly valid and partly invalid. The said Section has four parts out of which first part is invalid and cannot be given effect to. The Sectond part is valid and can be given effect to. The other two parts of Section 4B are merely ancillary and consequential to the first and second part. 8. (i) Section 4B is partly valid and partly invalid. The said Section has four parts out of which first part is invalid and cannot be given effect to. The Sectond part is valid and can be given effect to. The other two parts of Section 4B are merely ancillary and consequential to the first and second part. 8. The High Court has also held that Notification dated August 31, 1992, issued under Section 4 of the Markets Act in continuation of the Memo No. 3028 issued by the State Government of Bihar under Section 3 of the Markets Act declaring its intention of regulating the purchase and processing of items mentioned in the Schedule was bad and inoperative. 9. Against the impugned decision of the Patna High Court. Bihar State Agricultural Marketing Board, State of Bihar and several sugar mills have preferred appeals before this Court. It appears that each of the appellants is aggrieved by one part or the other of the impugned decision of the High Court. Mr. Venugopal Senior Advocate, Mr. Gopal Subramaniam, Sr. Advocate, Mr. A.K. Ganguly, Sr. Advocate and Mr. Raja Ram Agarwala, Sr. Advocate, have made submissions for the Sugar Mills. Mr. A.K. Sen Sr. Advocate has argued for the Bihar State Agricultural Marketing Board and Mr. S.B. Sanyal, Sr. Advocate has made submissions for the State of Bihar at the hearing of these appeals. As the arguments advanced by the learned counsel for the sugar mills are more or less on the same strain, instead of noting the arguments of each of the learned counsel appearing for the respective sugar mill separately, it is proposed to deal with the submissions made on behalf of the sugar mills jointly in order to avoid repetitions. 10. Mr. A.K. Sen, learned Senior Advocate, appearing for the Bihar State Agricultural Marketing Board, has submitted that the disputes involved in the Writ Petitions and determined by the High Court had their genesis in Notification dated May 2, 1977 issued under the Markets Act. The Notification deleted sugar, inter alia, as an item in the Schedule of the Act being item No. XII thereof and also other items in the Schedule which were already in the Schedule at the commencement of the Act. The Notification deleted sugar, inter alia, as an item in the Schedule of the Act being item No. XII thereof and also other items in the Schedule which were already in the Schedule at the commencement of the Act. The power to delete is conferred by Section 39 of the Act whereby the State Government has been given the power to amend or cancel any of the items specified in the Schedule to the Act, Mr. Sen has submitted that this power to amend or cancel is not controlled by Sections 3 or 4 of the Markets Act as the Act from the very beginning. Notification dated May 2, 1977 was, however, cancelled or rescinded by a fresh notification dated May 21, 1977. There was no notification under Section 39 of the Act including sugar in the Schedule nor was any notification issued under Section 3 and 4 of the Markets Act in relation to sugar. Mr. Sen has further submitted that the Patna High Court in Writ Petition in the case of D.C.M. v. Agricultural Produce Marketing Committee1 accepted the contention that Section 24 of the Bihar and Orissa General Clauses Act did not have the effect of having the original position, before deletion of sugar from the Schedule, restored. The High Court held that sugar having been deleted by Notification dated May 2, 1977 from the Schedule, subsequent notification of May 21, 1977 did not have the effect of re-introducing sugar as one of the items of the agricultural produce. Even if notification dated may 21, 1977 is treated as re-introducing sugar as an agricultural produce within the meaning of the Act, that by itself, would not make the Act applicable to sugar unless there was a fresh notification under Sections 3 and 4 of the Markets Act. Therefore, the fees levied and claimed by the concerned Marketing Committee could not be sustained. 11. Mr. Sen has submitted that if the judgment of the High Court was correct, then this defect could only be cured by fresh legislation and not by a fresh notification under Section 39 of the Markets Act. Though the State Government of Bihar and the Marketing Committee had appealed against the Judgment of the High Court by filing a Special Leave Petition against the same before this Court, the appeal has not been heard yet. Though the State Government of Bihar and the Marketing Committee had appealed against the Judgment of the High Court by filing a Special Leave Petition against the same before this Court, the appeal has not been heard yet. Hence, the position flowing from the judgment of the High Court had to be rectified.The State Government, therefore, exercised its power of promulgating ordinance under Article 213 of the Constitution by introducing Sections 4A and 4B in the Markets Act. Such Ordinance was later on replaced by an Amending Act. Mr. Sen has also submitted that the contentions which were accepted by the High Court in the D.C.M.s case and also in the present case are based on the hypothesis that Section 39 of the Act can have no effect without the aid of notifications under Sections 3 and 4. Such a premise, according to Mr. Sen, is incorrect. Mr. Sen submitted that Section 4(2) read with Section 15 of the Markets Act only prevents any municipality or local authority or any private person from establishing or continuing or allowing to set up or continuing a place for the purchase sale, store or processing of any such agricultural produce notified under Section 4(2), except in accordance with the provisions of this Act. Mr. Sen has submitted that Section 39 is the instrumentality by which a produce is brought into the Schedule, where such produce was not in the Schedule. It is only when a produce finds its place in the Schedule, that its control under the Market Act by notifications under Sections 3 and 4 of the Act becomes relevant and possible. Before Sections 3 and 4 of the Act can be applied, the concerned produce must be in the Schedule, as defined in Section 2(1)(a) of the Markets Act. The first step is to look to the Schedule to find out what produces can be controlled. Control under the Act is not in vaccum but is in respect of the scheduled produces, through the mechanism of Sections 3 and 4 for controlling them. 12. Mr. Sen has submitted that Section 15 of the Act provides one of the teeth for Section 4 read with Section 3 of the Act. Control under the Act is not in vaccum but is in respect of the scheduled produces, through the mechanism of Sections 3 and 4 for controlling them. 12. Mr. Sen has submitted that Section 15 of the Act provides one of the teeth for Section 4 read with Section 3 of the Act. It prescribes that all goods specified in the Notification under Section 4(1) of the Act shall pass through the principal market yard or yards, as the case may be, and shall not be sold or purchased at any other place within the market proper and sales and purchases of such agricultural produce in such yards, shall be made by means of open auction. 13. Mr. Sen has contended that the effect of the amendment of Section 15(2) of the Act is that if a scheduled agricultural produce is subjected to control by notification under Section 4(1), the subsequent steps under Sections 5, 6, 16 etc. come into force. But before steps under Sections 3 and 4 are taken, the produce concerned must be in the Schedule. It may be in the Schedule originally or it may be included by a subsequent notification under Section 39, which alone provides the machinery for such subsequent inclusion. According to Mr. Sen, it is an error to argue that Sections 3 and 4 of the markets Act must be used for such introduction, and not Section 39. Mr. Sen has submitted that Section 15 is confined only to such produce which is included in the notification under Section 4(1) of the Act; and this is not applicable to produce which as originally in the Schedule or is brought in the Schedule by a notification under Section 39 of the Act. Mr. Mr. Sen has submitted that Section 15 is confined only to such produce which is included in the notification under Section 4(1) of the Act; and this is not applicable to produce which as originally in the Schedule or is brought in the Schedule by a notification under Section 39 of the Act. Mr. Sen has also submitted that without such notification under Section 4(1) of the Markets Act, the sellers and buyers of a produce in the Schedule originally or subsequently introduced by notification under Section 39 of the Act, would not suffer from the disability under Section 15(1) of the Markets Act and such produce would also not be bound by the fetters of Sections 4 and 15 of the Act and the same can be sold in any place in the market area or outside and such sale and purchase would not be subject to the other provisions of the Act providing for control or levy of fees and matters connected therewith as provided under Sections 27A and 27B of the Act. It is only after the notification under Section 4, that the control of the Act visits the scheduled produce(s). The control does not come by the inclusion of a produce propio vigore. In other words, Section 39 of the Act, without the aid of a notification under Section 4(1) of the Act, would not attract the restrictions and control of the Act imposed by Sections 4, 5 and 15 and the traders will be allowed to buy and sell goods anywhere in the market area or outside. 14. It has also been contended by Mr. Sen that Section 39 is an independent provision and is not subject to the provisions of Sections 3 and 4 of the Markets Act. The Original Act did not contain Section 4(2) of the Act. It only came in 1974 by Amending Act 60 of 1980. It only provides for declaration of a market area for goods notified under Section 4(1) of the Markets Act and the restrictions under Section 15 of the Act are applicable only to such goods; for any other goods, including the goods originally in the Schedule, the Act provides no such restrictions. According to Mr. It only provides for declaration of a market area for goods notified under Section 4(1) of the Markets Act and the restrictions under Section 15 of the Act are applicable only to such goods; for any other goods, including the goods originally in the Schedule, the Act provides no such restrictions. According to Mr. Sen, Sections 5 and 18 and the Rules imposing various restrictions and also levy of fee under Section 27 of the Markets Act apply to all goods including goods notified under Section 4(1) of the Markets Act. 15. It is further contended by Mr. Sen that even if it is assumed that Section 39 alone cannot add to the Schedule without the aid of Sections 3 and 4, the infirmity is cured by the amending/validation Act by introducing Sections 4A and 4B. Mr. Sen has submitted that Section 4A frees Section 39 from the fetters of Section 4 and Section 15 of the Act. Hence, even if there are fetters, exercise of the power under Section 39 will be protected by Section 4A of the Amending Act because the fetters imposed by Section 4(2) of the Act would be in applicable in the matter of exercise of power by the State Government under Section 39 of the Markets Act. The exercise of the power under Section 39 is only for inclusion or alteration of the Schedule. Mr. Sen has also submitted that Sections 4(1) and (2) of the Markets Act are to be read together and they are not severable. Section 4B of the amending Act protects the levy and collection of fee in the past by enacting that such levy and collection are to be deemed valid and that Notification dated May 2, 1977 shall be deemed never to have been issued. According to Mr. Sen, the effect of Section 4B is that Notification dated May 2, 1977 will be non-est from the beginning. Therfore, no question of re-introducing new goods into the Schedule arises in this case because sugar had always been in the Schedule. 16. Mr. Sen has further submitted that the amending/validation Act gives protection (a) to levies and collections of fee made already and (b) to keep the items existing in the Schedule prior to May 2, 1977 in the Schedule without any necessity to following the provisions of Sections 3 and 4 of the Markets Act. Mr. 16. Mr. Sen has further submitted that the amending/validation Act gives protection (a) to levies and collections of fee made already and (b) to keep the items existing in the Schedule prior to May 2, 1977 in the Schedule without any necessity to following the provisions of Sections 3 and 4 of the Markets Act. Mr. Sen has further submitted that it is a fallacy to contend that Sections 3 and 4 were not amended. It should be noted that Section 4 A of the Act gives effect to amendments under Section 39 to the Schedule without complying with the provisions of Sections 3 and 4 of the Act, so that as from the commencement of the Act, the items added under Section 39 of the Act form part of the Schedule as originally enacted or modified. Mr. Sen has further contended that the intention of the State Legislature is clear. It wanted to include the goods brought into Schedule under Section 39 of the Act without the conditions of Sections 3 and 4 of the Act being notified. The exercise of the power under Section 39 is freed from the conditions imposed by Sections 3 and 4 of the Markets Act. Therefore, Section 24 of the Bihar General Clauses Act will apply, as the intention of the Legislature in enacting Sections 4A and 4B of the Act is clearly to include the items deleted on May 2, 1977 by giving effect to the notification of May 21, 1977, notwithstanding the non-compliance of the conditions in Sections 3 and 4 of the Act. Mr. Sen has also submitted that the legislature itself has made the classification of agricultural produces and has specified them in the Schedule. Thereafter, it has left to the State to alter the Schedule under Section 39 of the Act. The classification for the purpose of selecting scheduled produces and control are left entirely to the State Government under Sections 3 and 4 of the Markets Act, so that the classification for the purpose of control is made by the State Government according to the procedure laid down under Sections 3 and 4 of the Act. The only condition is that the State Government has to intend to declare its intention to control such agricultural produce for such area as may be specified in the relevant notifications. The only condition is that the State Government has to intend to declare its intention to control such agricultural produce for such area as may be specified in the relevant notifications. Exercise of the power under Section 4 is conditioned by Section 3(2) of the Act read with Section 4(1) of the Act. This dichotomy follows the pettern of many economic enactments like the Essential Commodities Act, 1955, where certain essential commodities are specified by Section 3(a) and then the addition of other essential commodities is left to the Central Government by a notified order. The power under Section 2(a)(xi) is not conditioned by any prior right of hearing or objections but is left to the judgment of the Central Government only. The power of control under the Essential Commodities Act, is also given to the Central Government under Section 3 of the Act and leaves it to be performed on the opinion of the Central Government that such control was needed for maintaining or increasing supplies of the concerned commodities or for securing their equitable distribution. 17. Mr. Sen has also submitted that the law is now well settled that a classification under any law may be made by the law itself or the law may leave it to some other authority to devise the classification for the purpose of achieving the objects of the Act. When such a classification is left to an authority other than the Legislature, the law may provide conditions for the exercise of such classification or leave it again to the judgment of the authority concerned. In support of this contention. Mr. Sen has referred to the decision of this Court in Ram Krishan Dalmia v. Shri Justice S.R. Tendukar2. Mr. Sen has submitted that various actions of the authorities, other than the Legislature, exercised under such delegated power like fixing of priceof mustard oil or other essential commodities have been upheld on the ground that the delegates knew the need and the reasons for the exercise of such powers. In this connection, Mr. Sen has referred to the decision of this Court in Prag Ice and Oil Mills v. Union of India3. 18. Mr. Sen has submitted that the Markets Act adopts different procedures for control and regulation and the setting up and running of regulated markets which have been found to be the principal objects of the Act. In this connection, Mr. Sen has referred to the decision of this Court in Prag Ice and Oil Mills v. Union of India3. 18. Mr. Sen has submitted that the Markets Act adopts different procedures for control and regulation and the setting up and running of regulated markets which have been found to be the principal objects of the Act. But machinery of control imposed under the Act rests on several provisions. The first step is to select the item of control by specifying the goods in the Schedule. The power of altering the Schedule is given to the State Government under Section 39 of the Markets Act, like the power of the Central Government to specify essential commodities under Section 2(a) of the Essential Commodities Act other than those specified by the Legislature. It has been contended by Mr. Sen that this is a case where the first step of classification is performed by the Legislature itself leaving it to the State to add or alter the field of control by deleting on adding to or amending the Schedule under Section 39 of the Markets Act. There is no condition for hearing etc. for the purpose of such a function in pari materia with the Essential Commodities Act. Then, when the area of control is circumscribed by the items in the Schedule, the actual control part of it including selection of scheduled goods to be controlled, the market area where the control will operate and where the controlled produce will have to be sold, are left to the judgment of the State Government, subject to the statutory conditions imposed by Sections 3(1) and 4(1) of the Markets Act. Mr. Sen has submitted that once the notifications under Sections 3 and 4 of the Act have been made specifying the goods to be controlled and the areas where the control will operate, other provisions of control contained in Section 5 onwards including the levy of fee under Section 27 of the Act and the provisions under Sections 39, 42, 48, 52, 53 and the Rules framed under the Act, spring into operation. The selection of the goods for control i.e. the broad field of the Act is done by the Legislature itself with a further power given to the State Government to alter the boundaries and the contents of the field. The selection of the goods for control i.e. the broad field of the Act is done by the Legislature itself with a further power given to the State Government to alter the boundaries and the contents of the field. For defining the field of control, no procedure for hearing the objections has been prescribed by the statute nor it is feasible to do so. It must be left to the judgment of the Legislature and the State Government concerned. But for the purpose of bringing the control into operation and for opening the gate for the stream of control to flow, a procedure is prescribed in Sections 3 and 4 of the Markets Act. 19. Mr. Sen has contended that it has not been alleged in the Writ Petitions nor has it been found in the judgment under appeal that by following the procedure of Sections 3 and 4 of the Markets Act agricultural produce has been included in the Schedule. In fact, even since control of sugar was imposed by fixing the market areas concerned, the Act has been operating for controlling sales of sugar and the purchases have been levied with fee and regulated by other provisions of control. Mr. Sen has further submitted that it is not argued nor is it possible to argue that that notification under Section 39 had to take the aid of Sections 3 and 4 of the Markets Act. The deletion of sugar by the first Notification had the effect of shrinking the field of control of the original Schedule. It should better be appreciated that it was not a deletion under Section 4(1) of the Act and therefore it was sought to be done without following the procedure prescribed in Sections 3 and 4 of the Act. 20. Mr. Sen has contended that there was no challenge from the Writ Petitioners against the exclusion of sugar from the Schedule by the Notification of May 2, 1977 made under Section 39 of the Markets Act on the ground that such exclusion was made without taking recourse to the procedure prescribed in Sections 3 and 4 of the Markets Act. The reason is obvious. Section 3 would apply in case of inclusion or exclusion of the produce or markets which have been brought under control already under Section 4(1) of the Act. The reason is obvious. Section 3 would apply in case of inclusion or exclusion of the produce or markets which have been brought under control already under Section 4(1) of the Act. Section 4(3) does not contemplate inclusion or exclusion of the Schedule under Section 39 of the Act, but makes Section 3 applicable only to inclusion and exclusion of the produces or the areas of the market concerned which have been notified for control in a specified market by State Government. Mr. Sen has submitted that on a parity of reasoning there cannot be any complaint against the notification of May 21, 1977 under Section 39 of the Act or under Section 24 of the Bihar General Clauses Act rescinding the earlier notification. The step for control having been taken by the delegated authority and control having been imposed already on sugar, any exclusion of the control of sugar would have to follow the procedure of Section 3 of the Act. That not having been done,the State Government was entitled to cancel the Notification of May 2, 1977. 21. Mr. Sen has contended that the High Court was wrong in holding that such notification could nullify the control imposed earlier on sugar as a scheduled commodity and it needed re-introduction of control of sugar by following the procedure of Sections 3 and 4 of the Markets Act. Mr. Sen has submitted that inclusion and deletion from the Schedule of a commodity under Section 39 of the Markets Act are functionally different from imposing control of produces already in the Schedule under Sections 3 and 4 of the Markets Act. The Schedule fixes the contents of the field from which the items covered therein are intended to be selected for control. But a notification under Section 4(1) of the Act fixes the area of the control and the commodity to be controlled within that area. The latter can only be altered by following the procedure under Sections 3 and 4 of the Act. 22. With regard to challenge under Articles 14 of the Constitution, Mr. But a notification under Section 4(1) of the Act fixes the area of the control and the commodity to be controlled within that area. The latter can only be altered by following the procedure under Sections 3 and 4 of the Act. 22. With regard to challenge under Articles 14 of the Constitution, Mr. Sen has submitted that the High Court has held that the amending Act has created two different procedures - one for the items which were introduced or re-introduced by Section 39 of the Markets Act without the fetters of Sections 3 and 4 of the Markets Act read with Section 15 of the Markets Act and the other for the articles which are introduced or re-introduced under Sections 3 and 4 of the Markets Act which gives a right of hearing and making objections against inclusion of an item not in the Schedule. Mr. Sen has submitted that this reasoning with respect is not correct. According to Mr. Sen, the amendment only cancels or rescinds the Notification of May 2, 1977 and preserves the status quo as on that date including sugar in the Schedule as it was before. If the deleting notification is made non-est, then there is no question of any introduction by following the procedure of Sections 3 and 4 of the Markets Act. Mr. Sen has also submitted that it should be borne in mind that Section 39 of the Markets Act is not subordinate to Sections 3 and 4 of the Act and it can exist independently. Only for the purpose of bringing in the restriction under Section 15 of the Act, aid from Sections 3 and 4 of the Markets Act is necessary. Once an item is included in the Schedule under Section 39 of the Markets Act, it will be subjected to all the provisions of the Act, excepting Section 15, which is confined to items dealt with under Sections 3 and 4 of the Markets Act. As from the date of the amending Act, there will be no difference of procedure for the exercise of power under Sections 3 and 4 and for the exercise of power under Section 39 of the Act, following of the provisions of Sections 3 and 4 of the Markets Act is not necessary. Mr. As from the date of the amending Act, there will be no difference of procedure for the exercise of power under Sections 3 and 4 and for the exercise of power under Section 39 of the Act, following of the provisions of Sections 3 and 4 of the Markets Act is not necessary. Mr. Sen has submitted that the Legislature is competent to say that some of the provisions would not be subject to some other provisions. New Sections 4A and 4B are now parts of the Act and these new provisions are to be construed harmoniously with Sections 3 and 4 read with Section 15 of the Act. Mr. Sen has submitted that it must be presumed that the exercise of the powers under Sections 39, as under Sections 3 and 4, will be made reasonably and not arbitrarily and indiscriminately. In exercising the powers under Section 3 of the Markets Act, all that is necessary is a declaration of intention to include a particular article in a particular market and then followed by nearing. In the case of Section 39, the power is only freed from the duty to hear objections. Mr. Sen has submitted that in almost all fiscal legislations like the Sales Tax Act, the Excise Act, the Customs Act, the right or hearing is not a necessary condition for the regulation and levy under the said enactments. A simple notification is enough to include an item even by a delegated power which has been considered to be legislative in character.So long as the main provision delegating the power does not suffer from any bias, the delegated authority can validly exercise the power. Mr. Sen has submitted that the Legislature may very well be of the view that for including certain items in Sections 3 and 4 of the Act benefit of hearing is necessary. 23. Mr. Sen has also submitted that the challenge under Article 19 of the Constitution is very weak as it is founded on the ground that Sections 3 and 4 still continue to operate and that Sections 4A and 4B were not proper validating provisions as the Legislature had no power to enact the same with retrospective effect. Mr. Sen has submitted that it is only where the previous law is subjected to certain infirmities, that a validation enactment comes to protect it. Mr. Sen has submitted that it is only where the previous law is subjected to certain infirmities, that a validation enactment comes to protect it. It is true that the Legislature would not be competent to validate the provisions which are not within its legislative competence; but this question cannot arise here as the Legislature was fully competent to legislate on the subject. The Act is for the public benefit and for the protection of agricultural producers from middlemen and brokers, so also for the regulation of quality and weight and for providing facilities in the markets and the market areas concerned with the aid of the fees collected. Mr. Sen has, therefore, submitted that challenge under Article 19(1)(g) of the Constitution is without any basis and must fail. 24. Mr. Sen has therefore submitted that the impugned decision of the High Court should be set aside and the appeals preferred by the Bihar Agricultural State Marketing Board should be allowed and the appeals preferred by the sugar mills should be dismissed by upholding the validity of the Notification dated May 21, 1977, so too vires of Sections 4A, 4B and Section 33M. 25. The arguments advanced by the respective counsel appearing for various sugar mills may be summarised as follows : (i) The title to the Markets Act itself delineates its scope, which is to provide for better regulation of buying and selling of agricultural produce and the establishment of markets for agricultural produce in the State and for matters connected therewith. In the Statement of Objects and Reasons of the Markets Act, it has been indicated that the Act is aimed to constitute regulated markets so as to secure to the cultivator better prices, fair weighment and freedom from illegal deductions, a fair deal for the agriculturists provide good incentive for the agriculturists to adopt improved agricultural programme etc. The main objects of the Markets Act are to create market area and markets with a view to ensuring constitution of market committees fully representatives of growers, traders, local authorities and Government for supervising the working of regulated markets and regulation of market charges and prohibition of realisation charges etc. The main objects of the Markets Act are to create market area and markets with a view to ensuring constitution of market committees fully representatives of growers, traders, local authorities and Government for supervising the working of regulated markets and regulation of market charges and prohibition of realisation charges etc. (ii) (a) When the State Government decides to exercise its control over the purchase, sale, storage or processing of any agricultural produce in a specified area, it can do so only by issuing a notification declaring its intention to that effect and by inviting objections or suggestions within a period of not less than two months. The State Government is required to consider such objections or suggestions. (b) Any inclusion of an item in the Schedule to the Markets Act under Section 39 does not bring about any control or regulation of sale, purchase, storage or processing of such produce. In order to regulate and bring the produce under control, it is necessary that intention to regulate a produce is to be notified. When it is finally decided after hearing objections to the Notification under Section 4(1) is to be issued declaring the area specified in the notification issued under Section 3 or any portion thereof to be market for the purpose of the Markets Act in respect of any of the agricultural produce. Sub-section (2) of Section 4 provides that after the date of publication of notification under sub-section (1) of Section 4 or such later date as may be specified therein, no municipality, local authority or other person shall within the area notified in the official gazette set up, establish or continue any place for the purpose of sale, purchase, storage or processing of any agricultural produce so notified, except in accordance with the provisions of Markets Act, the Rules and by laws. Sub-section (3) of Section 4 provides that subject to the provisions of Section 3, the State Government may at any time, by notification, exclude from a market area or any area or any agricultural produce specified therein or include in any market area or any area or agricultural produce. Sub-section (3) of Section 4 provides that subject to the provisions of Section 3, the State Government may at any time, by notification, exclude from a market area or any area or any agricultural produce specified therein or include in any market area or any area or agricultural produce. (c) It is thus clear that the scheme of the Act is that after it is determined legislatively as to what are the agricultural produces within the meaning of the Act and which are provided in the Schedule to the Act, the second stage of contemplated exercise of control of regulation can be undertaken by following the procedure laid down under Sections 3 and 4 read together. It is quite apparent that until declaration under Section 4 is notified by the State Government, the question of any regulation and control of sale, purchase, storage or processing of any agricultural produce mentioned in the Schedule to the Act does not arise at all. (iii) The Markets Act presents an integrated scheme and Section 39 of the Act cannot be read in insolation of other provisions of the Act. It is a settled rule of construction that the provisions of the Act should be read as a whole so as to determine the scope and effect of each of them. The provisions of the Act should be harmoniously construed so as to allow each of the provisions to have full effect. No particular provision should be so construed as would render other provisions ineffective or redundant. Moreover, the provisions are to be so construed as would subserve the basic scheme and object of the legislation. (iv) The Amending/Validation Act introducing Section 4A and Section 4B fails to revive control of any agricultural produce, even if it is included in the Schedule under Section 39 of the Act, until and unless the provision of Sections 3 and 4 of the Act read with Section 15 are complied with. Section 4A and Section 4B are invalid. Section 4A contains two sub-sections. Sub-section (1) of Section 4A, in so far as it dispenses with the requirement of complying with the provisions of Sections 3 and 4 before market fee can be validly levied on an agricultural produce, is bad and void for being repugnant to the scheme of the Act. Section 4A and Section 4B are invalid. Section 4A contains two sub-sections. Sub-section (1) of Section 4A, in so far as it dispenses with the requirement of complying with the provisions of Sections 3 and 4 before market fee can be validly levied on an agricultural produce, is bad and void for being repugnant to the scheme of the Act. It is also bad and void for truncating valuable rights given to citizens and others under Sections 3 and 4. Sub-section (1) of Section 4A also obliterates the concept of market area which is the sole basis of operating the Act and for imposing the levy. As a result of sub-section (1) of Section 4A, the basis of the Act gets transmuted from an Act levying a fee to an Act imposing tax. Sub-section (2) of Section 4A is also bad because it renders invalid the notifications for deletion of items issued by the State Government, which have been acted upon by the citizens and all concerned. The introduction of Sub-section (2) of Section 4A retrospectively with effect from 6.8.1960 would lead to invalidation of notifications by which items have been deleted and enable the market committee to impose a fee and to collect the fee in respect of items which have been deleted, the same is bad inasmuch as it undoes the certainty with which citizens had acted upon issuance of notification under Section 39 of the Act deleting items from the Schedule. Section 4A(2) is also bad inasmuch as the Legislature has provided an opportunity for hearing at the stage of deletion of the items from the Schedule and not at the stage of addition of the items. Since the process of addition and deletion are both legislative acts, unless a rational basis exists to differentiate the circumstance when an item is being deleted from the Schedule, non-affording of opportunity to the members of general public when an item is being added to the Schedule, is per se discriminatory and as such void. Sub-section (1) and (2) of Section 4A cannot co-exist with 3 and 4 of the statute. The continuance of Sections 3 and 4 after the Amending Act is entirely futile and these sections have been reduced to a dead letter. Such cannot be the scheme of the Act. Sub-section (1) and (2) of Section 4A cannot co-exist with 3 and 4 of the statute. The continuance of Sections 3 and 4 after the Amending Act is entirely futile and these sections have been reduced to a dead letter. Such cannot be the scheme of the Act. Particularly, when Sections 3 and 4 have always been adverted to by this Honble Court while analysing the scheme of the provisions of the Act both in relation to the declaration of a market area and also the declaration of a principal market/sub market yard and while adjudging the validity of imposition of fee. Section 4A by obliterating the right to object conferred under Section 3 introduces an unnecessary hardship and exposes the entire scheme of the Act to a charge of unreasonableness. The substantial nature of the objections of the appellant as depicted in the objections filed would indicate that they had a right at least to set forth the grievances for consideration by the State Government. Section 4B of the Act is a consequential provision. Section 4B is a validating provision proceeding on the basis of during the defects pointed out by the Division Bench of the High Court in the D.C.M. case through the medium of 4A and consequently validating all collections as if the same was authorised by the Amending Act and also removing the impediments of any judgment by a court to the contrary. It is, therefore, submitted that Section 4B containing the words : "as if such levy and collection was made under the provisions of this Act as amended by this Act..." (emphasis supplied) Indicate that 4B cannot have any existence independent of its own. The effect of the judgment of the Division Bench in striking down Section 4A entirely and upholding the fiction contained in Section 4B would lead to an anomalous result that without during the defect