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2000 DIGILAW 931 (PNJ)

United Riceland Limited v. State of Haryana

2000-08-16

G.S.SINGHVI, NIRMAL SINGH

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JUDGMENT G.S. Singhvi, J. - This is a petition for quashing of the notices Annexures P1 and P2 issued by the Assessing Authority of the Market Committee, Nilokheri (respondent No. 2) under the Haryana Rural Development Rules, 1987 (for short, the 1987 Rules). 2. The petitioner is registered as a dealer under the Punjab Agricultural Produce Markets Act, 1961 (as applicable to the State of Haryana) (for short, the 1961 Act). It is engaged in the manufacture of rice from the paddy purchased within and outside the State of Haryana and on the purchase of paddy, it is liable to pay Haryana Rural Development Fund (for short, HRDF) in accordance with provisions of th Haryana Rural Development Act, 1986 (for short, the 1986 Act) read with the 1987 Rules. 3. The grievance of the petitioner is that without issuing notice under Rule 3(9) of the 1987 Rules and without giving it an opportunity of hearing and without passing an order of assessment, respondent No. 2 has initiated steps for recovery of HRDF allegedly due from it and for this purpose, notices Annexures P1 and P2 have been issued. According to the petitioner, the impugned action of the respondent No. 2 is without jurisdiction and contrary to the law laid down by this Court in 1997(1) RCR(Civil) 88 (P&H)(DB) : CWP No. 8687 of 1996 - Puri Oil Mills v. Haryana State Agricultural Marketing Board, decided on 25.9.1996. 4. In the written statement filed on behalf of respondents No. 1 and 2, it has been averred that action for recovery of HRDF has been initiated after giving notice dated 11.11.1998 to the petitioner under Section 33-A of the 1961 Act for production of records pertaining to the period from 1.4.1996 to 31.3.1998 because the relevant record was not produced. The respondents have further averred that the petitioner is a habitual defaulter in paying HRDF and after receipt of the impugned notice, it has voluntarily deposited the amount of HRDF with penalty. Along with the written statement, the respondents have enclosed copies of notices issued under Section 33-A of the 1961 Act containing the particulars of the proforma of checking of account books of the petitioner. 5. Along with the written statement, the respondents have enclosed copies of notices issued under Section 33-A of the 1961 Act containing the particulars of the proforma of checking of account books of the petitioner. 5. In the replication filed by the petitioner, the assertion made in the written statement about the voluntary deposit of the amount of HRDF and penalty has been contested and it has been averred that the said amount was deposited under compulsion. 6. At the hearing, Shri Rajesh Bindal stated that the petitioner does not want to contest the levy of HRDF, but wants invalidation of the forcible recovery of penalty. He argued that the impugned notice should be declared void on account of violation of Rule 3(9) of the 1987 Rules which represents the statutory embodiment of the rule of audi alteam partem. Shri Bindal submitted that before initiating action for recovery of dues under the 1986 Act, respondent No. 2 was bound to follow the procedure prescribed in the 1987 Rules, which included giving of notice and opportunity of hearing to the dealer and passing of an order of assessment and as the said respondent has failed to follow the mandatory procedure, notices Annexures P1 and P2 should be declared illegal and quashed. On the other hand, Shri I.S. Sidhu vehemently argued that the Court should not grant an indulgence to the petitioner keeping in view the fact that it is a habitual defaulter. He submitted that the petitioner has been doing the business of purchase of paddy for the last many years and, therefore, it cannot plead ignorance about its duty to comply with the provisions of the 1987 Rules. 7. In our opinion, the argument of Shri Rajesh Bindal merits acceptance. A reading of the scheme of the 1987 Rules in general and Rule 3(9) in particular shows that before initiating action for recovery of HRDF, respondent No. 2 is under an obligation to give opportunity of hearing to a dealer. This necessarily means that the Assessing Authority has to give notice to the dealer about the proposed recovery of the dues and imposition of fine or penalty and it shall pass an order after hearing the representative of the dealer. This necessarily means that the Assessing Authority has to give notice to the dealer about the proposed recovery of the dues and imposition of fine or penalty and it shall pass an order after hearing the representative of the dealer. The facts of this case show that without passing an order after following the procedure prescribed in Rule 3 of the 1987 Rules, respondent No. 2 straightaway issued the impugned notices and compelled the petitioner to deposit the amount of HRDF and penalty. Therefore, we have no hesitation to hold that notices Annexures P1 and P2 are ultra vires to the 1987 Rules. 8. For the reasons mentioned above, the writ petition is allowed. Notices Annexures P1 and P2 are declared illegal and quashed with liberty to respondent No. 2 to pass appropriate order after giving opportunity of hearing to the petitioner. This shall be done within a period of three months from the date of receipt/submission of a copy of this order. We also direct that till the passing of the fresh order, the amount already deposited by the petitioner shall not be refunded and if it is found that the penalty is leviable upon it in terms of Rule 3(9) of the 1987 Rules, then it will not be necessary for the concerned authority to refund the amount already deposited, else the excess amount, if any, deposited by the petitioner shall be refunded to it. Writ petition allowed.