Judgment M. Y. Eqbal, J. 1. Originally, this writ application was filed by M/s New swadeshi Sugar Mills Ltd. , Sub-sequently, this was merged with Oudh Sugar mills Ltd. and application to that effect was filed by the original petitioner, namely, New Swadeshi Sugar Mills Ltd. , and this Court by order dated 9-8-1991 allowed the application for substitution of M/s Oudh Sugar Mills Ltd as petitioner in this case. 2. The petitioner has challenged the assessment order dated 20-5-1981 whereby a sum of Rs.12,51,180.85 was assessed as market fee payable by the petitioner and also a sum of Rs.50,000 was assessed as penalty payable by the petitioner. A copy of the said assessment order is Annexure-12 to the writ application. The petitioner has also challenged the notice dated 8-6-81 issued by the Secretary of the Market committee demanding the aforementioned amounts from the petitioner. A copy of the said demand notice is Annexure-13 to the writ application. 3. The brief facts of the case as stated by the petitioner are as follows: the petitioner is a Company registered under the Companies Act having its head office at Calcutta and is engaged in the business of manufacturing sugar by vacuum pan process in its factory situated at Narkatiaganj in the district of West Champaran. It has also a Distillery just adjoining to the premises of the Sugar Factory. The distillery is engaged in the business of manufacturing industrial alcohol. The molasses which is the bye-product of the sugar factory is transferred from sugar factory to its own distillery for manufacture of industrial alcohol. It is alleged that no sale of molasses from the sugar-factory to the distillery. According to the petitioner the purchase of sugar cane which is used as raw materials for manufacture of sugar, the manufacture of sugar and distillation and sale of molasses are completely regulated by various statutes enacted either by Parliament or by the State Legislature by various Control Orders made under the essential Commodities Act. The price of sugarcane, the sale price of levy sugar, molasses and the industrial alcohol are fixed by the Government authorities in exercise of powers conferred upon them under various statutes. The petitioners further case was that in order to manufacture sugar and industrial alcohol, the petitioner company purchases various materials like sulphur, lime, coal, fire-wood and many other articles. The price of sugarcane, the sale price of levy sugar, molasses and the industrial alcohol are fixed by the Government authorities in exercise of powers conferred upon them under various statutes. The petitioners further case was that in order to manufacture sugar and industrial alcohol, the petitioner company purchases various materials like sulphur, lime, coal, fire-wood and many other articles. Most of the purchases of the raw materials excepting the sugarcane is purchased from outside the market area of Narkatiaganj Market committee or even from the outside of the State of Bihar. With regard to the sugarcane, the petitioner has both reserved and free areas of sugarcane growing areas from which the petitioner is purchasing sugarcane for its consumption to manufacture sugar strictly in accordance with law. In order to manufacture sugar, industrial alcohol and also in order to purchase and crush sugarcane, the petitioner has to obtain licence under the different Statutes and also have to comply with the conditions of licence contained therein. The petitioners further case was that the state of Bihar enacted Bihar Agricultural Produce Markets Act in the year 1960 and the items mentioned in the schedule appended to the Act were declared to be agricultural produce. It levied a market fee at the rate of 25 paise per Rs.100 in the transaction of agricultural produce within the market area. It is stated that the commodities like sugarcane, sugar and molasses were not included in the original schedule appended to the aforesaid Act. In the year 1974 the Act was amended and the market fee was raised to Re.1 per Rs.100 and also apart from others, sugarcane, sugar and molasses were added to the Schedule. The State of Bihar by notification dated 28-7-1974 constituted a Market Committee at Narkatiaganj which also included Sikarpore Police station in which the petitioners factory is situated. The petitioners factory received the notice from the Market committee stating that as a Market committee has been constituted and as also the petitioner is engaged in the trade of sugarcane, sugar and molasses, it should obtain a licence and pay market fee on the sale or purchase of the aforesaid items at the prescribed rate. The petitioner protested the said notice on the ground that the act is not applicable to the sugar factory for various reasons stated therein. The petitioner protested the said notice on the ground that the act is not applicable to the sugar factory for various reasons stated therein. The question of applicability of the Act was also taken up by the Bihar Sugar Mills association of which the petitioner factory is also a member. The Association started representing the matter before the various authorities of the State of bihar and tried to pursuade the government to accept the contention that the bihar Agricultural Produce Market Act, whereinafter referred to as the Market act, is not applicable to the sugar factory. However it is stated by the petitioner that while the matter was pending before the Government for consideration, the Market Committee started taking coercive stops for realisation of market fee. In the meantime two other sugar factories, namely, Belsund sugar Company Ltd. , and Motihari sugar Factory, moved this Court for declaration that the Market Act is not applicable to the sugar factories on various grounds. The petitioner also moved this court by filing separate writ application being CWJC No.172 of 1976. The aforesaid two writ applications were heard together and were disposed of by a common judgment dated 20-4-1976 whereby this Court dismissed the writ application. The judgment is reported in AIR 1977 Patna 136, (Belsund Sugar Company Ltd. and Ors. V/s. State of Bihar ). The petitioner further case was that in the aforesaid judgment this Court gave a finding that the market Committee of the respective sugar factory was not providing any service in lieu of the market fee realised, and liberty was given to the petitioners to those writ application to move the authorities in case they do not get any service in future by the Committee. Against the aforesaid judgment those writ petitioners moved the Supreme court by filing civil Appeal Nos.398 and 399 of 1977 which is said to be pending before the Supreme Court. The petitioners thereafter was permitted to withdraw the writ application being cwjc No.172 of 1976 with certain direction to raise all the points before the Assessment Sub-Committee of the market Committee. The petitioner further case was that the Market Committee by letter dated 3-11-1980 intimated its intention to declare the petitioner factory premises to be a Sub Market and for the purposes of the Market Act, which was opposed by the petitioner on various grounds. The petitioner further case was that the Market Committee by letter dated 3-11-1980 intimated its intention to declare the petitioner factory premises to be a Sub Market and for the purposes of the Market Act, which was opposed by the petitioner on various grounds. However according to the petitioner although there was specific order of the Government to stop realising market fee till the disposal of the appeals by the Supreme court, the Market Committee continued assessing the liability of the market fee against the petitioner. Having no alternative the petitioner filed revised return and objections on the order passed by the Market Committee. In the year 1981 the petitioner was informed that the objections filed by the petitioner was disposed of and the petitioner was required to produce books of account for the entire period otherwise ex-pane assessment would proceed. Pursuant to the said notice the petitioner appeared through his lawyer and filed the detailed returns of purchase of sugarcane and the sale of sugar for the period commencing from 1974-75 to 1979-80. However in default of the petitioner to appear before the Assessment sub-Committee an ex-pane assessment order was passed by the impugned order fixing liability against the petitioner to the extent mentioned above and the demand notice was issued for realisation of the same. The order and the demand notice are included in the writ application. The petitioner has challenged the liability of payment of market fee on various grounds mentioned in the writ application and claimed that no market fee is payable by the petitioner. The petitioner has also challenged the legality and validity of the assessment order passed ex-pane. 4. A counter-affidavit was filed on behalf of respondent No.3, the secretary Agricultural Produce Market committee stating inter alia that the questions raised by the petitioner in the writ application has been decided in a number of decisions given by the High court and the Supreme Court and therefore nothing has been left to be decided in this case. In a separate counter-affidavit filed by the Respondent No.4 wherein it was asserted that as the petitioner purchases sugarcane from the market area of the respondent no.4 and sales the same in the markets. The assessment Sub-Committee of respondent No.4 assessed the liability against the petitioner for the purchase of sugarcane made in its market area. In a separate counter-affidavit filed by the Respondent No.4 wherein it was asserted that as the petitioner purchases sugarcane from the market area of the respondent no.4 and sales the same in the markets. The assessment Sub-Committee of respondent No.4 assessed the liability against the petitioner for the purchase of sugarcane made in its market area. During the pendency of the writ application the parties have exchanged the supplementary affidavit and supplementary counter-affidavit bringing various facts on record. 5. From the pleading of the parties two questions emerges for consideration by this Court : firstly whether the petitioners factory come within the purview of the Bihar Agricultural produce Market Act and is liable to market fee and secondly whether the ex-pane assessment order is legal, valid and in accordance with law. 6. I have heard Mr. Y. V. Giri, learned Senior Advocate appearing on behalf of the writ petitioner and Mr. Ashok Kumar Keshri, learned Senior advocate appearing for Market Committee. 7. So far the first question with regard to applicability of the Market act to the petitioners factory and the liability of the petitioner to pay market fee is concerned, it has no longer res-in-tegra. This question has been discussed at length in various decisions of this court. As noticed above, in the case of belsund Sugar Factory and others (supra)a question was raised with regard to the authority of the market committee to levy fee under the provisions of the market Act on the ground, inter alia, that the State legislature are not competent to enact the Act and fix liability against the sugar factory. A Bench of this Court while dismissing the writ applications had observed as under: "it was further urged that sugar Industry is an Industry under the control of the Union, and in view of the entry 52 of the Union List, Parliament has exclusive jurisdiction over the industries the control of which by the Union has been declared by Parliament by law, to be expedient in the public interest and, as such, the State legislature Is not competent to legislate and make provisions in connection with such industries and any such provision made In respect of such industries has to be declared as void. In this connection learned Counsel for the petitioner submitted that, if the provisions of the Act are held to be applicable to sugar industries, then the Act will be deemed to be under entry No.24 of the State List, that is, an act relating to an Industry, which in view of declaration by Parliament referred to above, is not permissible. In my opinion, it is difficult to hold that the Act, in pith and substance deals with industries as such. The object of the Act Is to regulate buying and selling of agricultural produce by establishing market for agricultural produce in the State of Bihar, and while doing so, its incidentally making the purchaser of sugarcane or sugar liable to pay market fee cannot be said to be an Act concerning an industry. The Bench of this court in m/s B. and K Traders V/s. State of Bihar, 1975 bbcj 1 , has considered as to under which entry the State List the Act in question falls and It has held that it is covered by Entry No.28. "markets and Fairs and, as such, in my opinion, there is no question of legislative incompetence on the part of the State Legislature in enacting the Act in question. Learned Counsel for the petitioner then submitted that, if it is held that the provisions of the Act are applicable even to purchase of sugarcane and sale of sugar made by the petitioner, then the Act and rules have to be declared void, in view of the fact that there is repugnancy between the provisions of the Act, read with the rules, and the provisions of the control orders made in exercise of the powers conferred by Sec.3 of the Essential Commodities Act by the Central Government; and both operate into the same field regarding sale and purchase of sugar. According to petitioner in such a situation, the State act must be deemed to be void, in view of article 254 (1) of the Constitution of india. It is difficult to accept this argument. Article 254 has no application to the cases where the conflict is between two Acts made by the Parliament and the State Legislature having competence to legislate the same on the principle of pith and substance. It is difficult to accept this argument. Article 254 has no application to the cases where the conflict is between two Acts made by the Parliament and the State Legislature having competence to legislate the same on the principle of pith and substance. The repugnancy referred to in Article 254 of the Constitution is in connection with acts when Parliament and the State legislature both are legislating in respect of any of the entries in the Concurrent List (List III ). I have already held that the Act in question has been enacted under Entry No.28 of the State list. As such, there is no question of its provisions being repugnant to the provisions of the Essential Commodities Act, which is a Central Act, to attract the provisions of Article 254. Reference in this connection may be made to the case of Prafulla Kumar mukherjee V/s. Bank of Commerce Ltd. , khulna, AIR 1947 PC 60 A. S. Krishna v. State of Madras, AIR 1957 SC 297 and kerala Electricity Board V/s. M/s. Midland rubber and Produce Co. Ltd. , (1976) 1 scc 466 : AIR 1976 SC 1031 . In the aforesaid case of AS. Krishna while interpreting sub-section (1) of section 107 of the Government of India Act, 1935, which was similar to Article 254 (1) of the Constitution, it was observed as follows : "for this section to apply, two conditions must be fulfilled: (1) The provisions of the Provincial law and those of the central legislation must both be in respect of a matter which is enumerated in the concurrent List, and (2) they must be repugnant to each other. It is only when both these requirements are satisfied then the provincial law will, to the extent of the repugnancy, become void. It is only when both these requirements are satisfied then the provincial law will, to the extent of the repugnancy, become void. The first question, therefore, that has to be decided is, is the subject-matter of the impugned legislation, one that falls within the provincial list, in which case Sec.107 would be inapplicable, or is it one which falls within the Concurrent List, in which case the further question, whether it is repugnant to the Central Legislation will have to be decided?" The same view was reiterated in the case of Kerala State Electricity board at page 478 (of SCC): (at p.1039 of AIR) (Supra) in these words: "that the question of repugnancy can arise only with reference to a legislation falling under the concurrent list is now well settled. " 8. It is worth to mention here that in the year 1977 by notification dated 2-5-1977, the State Government in exercise of power conferred by Sec.39 of v the said Act amended the schedule of the said Act by which sugar was emitted as an item of agricultural produce. However the said notification was can celled by a subsequent notification issued on 21-5-1977. The applicability of the Market Act was again challenged by various Mills owner engaged in the business of manufacturing Vanaspati, Edible oil and sugar. These writ petitions filed by different Mills owner have been disposed of a by a common judgment of a division Bench of this Court which is reported in 1992 (2) PLJR 253 : 1993 (1)BLJ 516 Delhi Clothe and General Mills company Ltd. V. A. KM. C. This Court in the aforesaid judgment upheld the validity of notifications issued by the state Government and further held that the Market Act is applicable in the cases of aforesaid products as they are agricultural produce so defined under the Act. It is also worth to be noticed that in the year 1992 when this Chapter was inserted in the Market Act by Bihar agricultural Produce (Amendment) Act 1992) making provisions for contribution in the State fund by the Committee various sugar industries again challenged the provisions of the Market Act by filing various writ applications. These writ applications have been disposed of by a common judgment which is also reported in 1994 (1) PLJR 407 (H. M. T. Sugar Limited V/s. State of Bihar ). These writ applications have been disposed of by a common judgment which is also reported in 1994 (1) PLJR 407 (H. M. T. Sugar Limited V/s. State of Bihar ). The aforesaid decision in effect upheld the levy of fee under the said Market Act with regard to sugar. 9. Having regard to the facts and circumstances of the case and the decisions referred to herein above, I am of the view that the answer to the first question would be negative, i. e. it cannot be held that the levy of fee by the market Committee under the Act is illegal and invalid. 10. So far the next question is concerned, Mr. Giri, learned Senior Coun-sel appearing for the petitioner made a very forceful submission challenging the validity of the assessment order. The learned Counsel submitted that even if the Act is declared valid the ex-pane assessment order is illegal and erroneous in law. 11. Mr. Giri submitted that the assessment order passed by the authority under the Act is without any basis and complete non-application of mind. Learned Counsel submitted that from the perusal of the assessment order itself it would appear that the said order was passed merely on surmises and are based on no evidence at all. It is further submitted that there is no finding in the assessment order about the Articles leaving the market area which is condition precedent for levying fee. There is no finding that gunny bags were purchased out of the market area. Learned counsel then submitted that by the impugned order of assessment fee has been imposed even on mango, lichi and other fruits and even on firewood. Learned Counsel lastly submitted that even on ex-pane assessment or in the "based judgment assessment" it must be based on some evidence. Learned Counsel in this regard relied upon a decision of the Supreme Court in the case of state of Orissa V/s. Maharaja Shri B. P. Singh Deo reported in AIR 1970 SC 670 . 12. On the other hand, Mr. Ojha, learned Counsel appearing on behalf of the market committee firstly submitted that no illegality has been committed by the authority in passing the ex pane assessment order inasmuch as in spite of service of notice on the petitioner asking it to obtain licence and file return, the later did not file return. 12. On the other hand, Mr. Ojha, learned Counsel appearing on behalf of the market committee firstly submitted that no illegality has been committed by the authority in passing the ex pane assessment order inasmuch as in spite of service of notice on the petitioner asking it to obtain licence and file return, the later did not file return. Learned counsel then submitted that if the petitioner was aggrieved or dissatisfied with the assessment, it may go in appeal or revision which is the remedy provided under the said Act/learned counsel submitted that the petitioner failed to perform his statutory duty by not filing the return and consequently in best-judgment assessment order passed by the authority, this Court, therefore should not interfere in the exercise of jurisdiction under Articles 226 and 227 of the Constitution of India. 13. Section 27 of the Bihar agricultural Produce Markets Act, 1990 (hereinafter referred to as the "said act") empowers the authority under the act to levy fee in respect of sale or purchase of the agricultural produce within the market area. In other words, Section 27 imposes a liability to pay market fee on the agricultural produce bought or sold within the market area. 14. Section 27-A lays down the procedure for filing the return and also empowering the authority to make an order of assessment. Sub-section (1) of that section provides that every market committee shall have an assessment sub-committee consisting of the Chairman, Vice-Chairman and the Secretary of the Market Committee for the purpose of assessment and levy of fee, in the prescribed manner. Sub-section (2)lays down the manner of furnishing return by all the licences. Sub-section (5) lays down the procedure for assessment and also consequences for non-filing of return. Sub-section (5) to sub-section (8) of Sec.27a are worth to be quoted hereinbelow: "section 27-A (1 ). . . . . . . (2 ). . . . . . . . . (3 ). . . . . . . . . (4 ). . . . . . . . . . Sub-section (5) to sub-section (8) of Sec.27a are worth to be quoted hereinbelow: "section 27-A (1 ). . . . . . . (2 ). . . . . . . . . (3 ). . . . . . . . . (4 ). . . . . . . . . . (5) If any trader fails to submit a return as prescribed in sub-section (2) or the sub-committee has reason to believe that any such return is incorrect, it shall after giving a notice in Form C to the trader concerned require him on a date and at a time and place to be specified therein, to attend either in person or through an authorised representative or to produce or cause to be produced any account or other evidence on which such trader may rely in support of such return. (6) On the date specified in the notice or as soon thereafter, as the case may be, the sub-committee after examining the accounts and other evidence produced by the trader and such other evidence, as the sub-committee, may by notice In writing require at the specified place, shall proceed to assess the amount of market fee leviable on the trader. (7) If a trader, having furnished a return, fails to comply with all the terms of the notice under sub-section (5) or If the accounts and other evidence produced by the trader are in the opinion of the subcommittee, incorrect, incomplete or unreliable, either wholly or partly, the sub-committee shall assess to the best of its judgment, the amount of market fee leviable on the trader. (8) In addition to the market fee levied under sub-section (7), a defaulter trader may be liable to pay a penalty equal to the fee so levied, if so ordered by the sub-committee. " 15. From perusal of the aforesaid provisions it appears that for the purpose of assessment and levy of fee the power is vested with the assessment subcommittee. In the event of failure of the trader to submit a return or in case the sub-committee believes that the return so filed is incorrect it shall call upon the trader and give a personal hearing and also require him to produce the accounts or other evidences in support of the return so filed. In the event of failure of the trader to submit a return or in case the sub-committee believes that the return so filed is incorrect it shall call upon the trader and give a personal hearing and also require him to produce the accounts or other evidences in support of the return so filed. Sub-section (6)provides that the sub-committee shall make fine assessment with regard to amount of market fee leviable on the trader sub-section (7) empowers the sub-committee to make a best-judgment assessment if the trader after having furnished a return, fails to comply with all the terms of the notice issued to him under sub-sectjon (5) or if the accounts and other evidences produced by the trader are incorrect, in-complete or unreliable, sub-section (8) imposes a liability upon a defaulter trader for payment of penalty if so ordered by the subcommittee. 16. In the light of the aforesaid provisions, I will first examine as to whether the impugned order of assessment is in accordance with law. 17. The case of the petitioner in the writ application is that when the market fee was demanded by the respondent the petitioner protested by its letter dated 11-6-1975. However, in the meantime, the petitioner filed c. W. J. C. No.172 of 1976 which was eventually withdrawn with a direction to the petitioner to raise all the points before the assessment sub-committee. The assessment sub-committee was also directed to take up the assessment of liability of market fee for the year 1976 on the basis of return already filed cr to be filed by the petitioner. It further appears that the petitioner after having failed to escape itself from the liability for payment of market fee filed a revised return in the year 1981 for the year 1976. On 11-3-1981 the market committee passed order rejecting all the objections taken by the petitioner with regard to the contention of the petitioner that the market committee is not providing any service to the petitioner. The petitioner alleged that the petitioner was not intimated about the aforesaid order dated 11-3-1981 rather the petitioner was informed that the return was defective by which the petitioner should appear on 25-3-1981 with the return commencing from 20-7-74 to 30-6-1980 for the assessment of liability to pay market fee. The petitioner alleged that the petitioner was not intimated about the aforesaid order dated 11-3-1981 rather the petitioner was informed that the return was defective by which the petitioner should appear on 25-3-1981 with the return commencing from 20-7-74 to 30-6-1980 for the assessment of liability to pay market fee. The petitioner further stated that the petitioner appeared with his lawyer on 20-4-1981 and filed a detailed return of purchase of sugarcane and sale of sugar for the period 1974-75 to 1979-80. It was alleged by the petitioner that on 29-4-1981 a clarification letter was received by the sub-committee and the petitioner was not informed about the date of hearing of the assessment proceeding which was fixed on 20-5-1981. 18. From the impugned order of assessment dated 20-5-1981 (Annexure 12) it appears that the assessing authority took into consideration the return filed by the petitioner and also the detailed figures of sale and purchase of the sugarcane, sugar, etc. furnished by secretary Market Committee came to a finding that there was some difference in between the two. Since the petitioner could not file any accounts in support of the details furnished in the return the authority relied upon the details of accounts obtained from the Secretary of the Market Committee, Bettiah and on the said basis the market fee payable by the petitioner was determined. Admittedly, the petitioner did not file any accounts or other evidence in support of the transaction of sugarcane and sugar within the relevant area and, therefore, in my opinion, the authority has not committed any illegality in accepting the proper accounts maintained by the secretary of the Market Committee, bettiah. However, from the impugned order of assessment (Annexure-12) it appears that the authority has acted mechanically in levying fee on the articles other than sugarcane and sugar. The imposition of market fee on supposed purchase of gunny bags is without any basis. The authority has not dealt with the stand taken by the petitioner that those gunny bags were purchased at calcutta and, therefore, no fee is leviable on the gunny bags which is not an agricultural produce. The authority has also failed to assign reasons as to how market fee is payable on the other articles namely, Sulphur, Paddy, Wheat and other fruits grown in the campus of the petitioners premises. The authority has also failed to assign reasons as to how market fee is payable on the other articles namely, Sulphur, Paddy, Wheat and other fruits grown in the campus of the petitioners premises. There is also no finding with regard to liability of the petitioner for payment of market fee on fire wood. As stated above, the authority while passing an ex pane order of assessment or best judgment assessment must not act arbitrarily and mechanically. The authority is bound to justify the levy of market fee on each and every item of agricultural produce. The authority having failed to do so the entire order of assessment cannot be held to be in accordance with law. 19. Having regard to the facts of the case, I am of the view that part of the order of assessment is liable to be quashed. In the result, this writ application is allowed in part and part of the assessment order dated 20-5-1981, so far it relates to levy of market fee on different articles other than sugarcane and sugar is quashed. Consequently, the imposition of penalty is also quashed. The respondent assessing authority is directed to make fresh assessment and pass fresh order fixing liability of payment of fee on those items after giving proper hearing to the petitioner. However, there shall be no order as to costs. Application Partly Allowed.