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2011 DIGILAW 346 (MP)

Krishi Upaj Mandi Samiti v. Sunil Kumar

2011-03-15

BRIJ KISHORE DUBE, S.K.GANGELE

body2011
JUDGMENT S.K. Gangele, J. 1. The Appellants have filed this writ appeal against the order dated 14-10-1999, passed in W.P. No. 405/1997. 2. M/s Banzai Brothers is the partnership firm and the Respondents No. 1 & 2 are the partners of the firm. The firm had a licence issued by the Appellant-Krishi Upaj Mandi Samiti for the purchase of food grains within the premises of the Appellant-Mandi Samiti from the farmers as required under the provisions of Madhya Pradesh Krishi Upaj Mandi Samiti Adhiniyam, 1972 (hereinafter referred to as the 'Act of 1972'). It was also granted a lease on 28-8-1994 of a land area 30 ft. x 100 ft. in plot No. 38 for a period of 30 years within the marketyard of the Mandi Samiti. Thereafter the firm constructed a godown over the aforesaid plot. 3. The firm purchased agricultural produce within the marketyard from some agriculturist but it had not been paid the amount to the agriculturist hence, the licence of the firm was cancelled. The Krishi Upaj Mandi Samiti initiated proceedings in regard to recovery of the amount due to the firm under the provisions of the Act of 1972. Thereafter a writ petition was filed before this Court against the aforesaid action of the Krishi Upaj Mandi Samiti which was registered as W.P. No. 1824/1996. Learned Single Judge of this Court vide order dated 18-12-1996 disposed of the aforesaid petition with the following directions: Learned Counsel for the Petitioner submits that the Respondents have not yet determined the amount due. The Respondents should determine, the amount in presence of the Petitioner and liability of the Petitioner will only arise when the Respondents have determined the amount. It is ordered that the Petitioners property shall not be auctioned till the amount due is determined. The Respondents shall afford full opportunity of hearing to the Petitioner before determining the amount. Petitioner shall co-operate with the Respondents in determining the dues. Petitioner is directed to appear in the office of the Respondent No. 1 on 31st December, 1996. Outstanding security amount be refunded to the Petitioner. With the aforesaid observation, petition is disposed of. 4. The Respondents shall afford full opportunity of hearing to the Petitioner before determining the amount. Petitioner shall co-operate with the Respondents in determining the dues. Petitioner is directed to appear in the office of the Respondent No. 1 on 31st December, 1996. Outstanding security amount be refunded to the Petitioner. With the aforesaid observation, petition is disposed of. 4. The Krishi Upaj Mandi Samiti vide letter dated 3-1-1997 informed the partner of the firm Respondent No. 1 that as per the official record it had to pay the following amount to different agriculturists against the purchase of agricultural produce by the firm on different dates mentioned in the letter which is as under: ???. ??????? ?????? ?????????? ???? 1. ?????????????????????????????????? ??? 11-2-1995 50,985/- 2. ?????????????????????????????????????? ??? 21-2-1995 53,890/- 3. ?????????????????????????????????????? ??? 21-1-1995 53,460/- 4. ?????????????????????????????????? ??? 23-1-1995 52,085/- 5. ???????????????????????? ????? 20-4-1995 21,003/75 6. ???????????????????????????????????? ????? 21-4-1995 35,392/65 7. ???????????????????????????????????? ????? 20-4-1995 18,963/30 8. ???????????????????????????????????? ????? 20-4-1995 52,524/65 9. ???????????????????? ??? 23-5-1995 8,400/65 10. ????????????????????????????? ????? 2-11-1994 11,296/25 11. ????????????????????????????? ????? 20-11-1994 25,532/50 12. ????????????????????????????? ??? not legible 22,918/- 13. ????????????????????????????? ????? 22-11-1994 46,612/- ??? ----- 4,53,063/10 5. As per the aforesaid letter the liability of the Respondents in regard to payment of amount to the agriculturists was of Rs. 453063.10/-. The firm vide letter dated 4-1-1997 denied the fact that it was liable to pay the amount to the Krishi Upaj Mandi Samiti in accordance with the letter of the Secretary. Thereafter the Samiti vide letter dated 17-1-1997 informed the firm that an amount of Rs. 6,39,863.10/- was due against the firm and the Samiti was initiating proceedings of auction of the godown of the firm. The firm again filed a writ petition before this Court challenging the action by the Krishi Upaj Mandi Samiti. The aforesaid petition was registered as W.P. No. 121/97. This Court vide order dated 30-1-1997 disposed of the aforesaid writ petition with the observation that the firm had already filed an appeal under Section 34(2) of the Adhiniyam 1972 and it was pending before the competent authority and the firm can also move an application for interim stay. The appellate authority-Additional Director dismissed the appeal vide order dated 27-2-1997. Against the aforesaid order, the Respondents No. 1 & 2 filed a petition before this Court. The appellate authority-Additional Director dismissed the appeal vide order dated 27-2-1997. Against the aforesaid order, the Respondents No. 1 & 2 filed a petition before this Court. The learned Single Judge of this Court after holding that unless and until the agricultural produce be seized and sold in auction in that circumstances, the loss can be determined and that amount can only be recovered from the Petitioners in accordance with the provisions of Section 17(2)(xiii) of the Adhiniyam of 1972 and because no such procedure was adopted by the Krishi Upaj Mandi Samiti, hence, recovery is illegal and quashed the auction proceedings. 6. Learned Counsel for the Appellants-Mandi Samiti has contended that the order of the learned Single Judge is against the provisions of Section 17(2)(xiii)(a) of the Adhiniyam 1972. As per the aforesaid section, the Mandi Samiti is authorised to seize the agricultural produce along with the property of the person concerned and arrange for resale and if there was any loss further, then the Mandi Samiti has power to recover the same and because the Respondents No. 1 & 2 did not pay the amount of agricultural produce which was purchased within the premises of Mandi Samiti and it was paid to the agriculturists by Krishi Upaj Mandi Samiti, hence, the action of the Krishi Upaj Mandi Samiti is in accordance with law. 7. Contrary to this, learned Counsel appearing on behalf of the Respondents No. 1 and 2 has submitted that the Krishi Upaj Mandi Samiti has no power and authority to sell or auction the property of the Respondent without ascertaining the loss caused to the Krishi Upaj Mandi Samiti. In the present case, the loss has not been ascertained, hence, the action of the Krishi Upaj Mandi Samiti is illegal and the order passed by the learned Single Judge to this effect is in accordance with law. 8. The allegation against the Respondents No. 1 and 2, who are the partners of the partnership firm is that the partnership firm purchased agricultural produce from the agriculturists within the marketyard of the Appellant-samiti, however, they did not pay the amount to the agriculturists. The Mandi Samiti in the show cause notice dated 13-1-1997 specifically mentioned the amount and names of the agriculturists whom money was not paid by the Respondents. The details have been mentioned above in para 4 of this judgment. The Mandi Samiti in the show cause notice dated 13-1-1997 specifically mentioned the amount and names of the agriculturists whom money was not paid by the Respondents. The details have been mentioned above in para 4 of this judgment. Reply of the Respondents No. 1 & 2 was not satisfactory, therefore, an order for recovery of the amount was passed. The Respondents No. 1 and 2 challenged the aforesaid order in an appeal before the appellate authority and the appellate authority dismissed the appeal after considering the factual aspect in detail, hence, the order of the appellate authority in regard to determination of factual controversy has become final. 9. Section 17 under Chapter 4 of the Adhiniyam, 1972 prescribes powers and duties of market committee. Section 17(2)(xiii)(a) casts a duty on Mandi Samiti to ensure payment to the agriculturists in respect of transactions which takes place in the marketyard. The section further authorises the Mandi to recover the same from the original buyers. The relevant section is as under: 17(2)(xiii)(a) ensure payment in respect of transactions which take place in the market yard or market proper to be made on the same day to the seller, and in default to seize the agricultural produce in question along with other property of the person concerned and to arrange for resale thereof and in the event of loss, to recover the same from the original buyer together with charges for recovery of the loss, if any, from the original buyer and effect payment of the price of the agricultural produce to the seller; (b) recover the charges in respect of weighment and hammali and to distribute the same to weighmen and hammals; 10. From the reading of the aforesaid section, it is clear that the Krishi Upaj Mandi Samiti has power to seize the agricultural produce along with other property of the person concerned who has not paid the amount of agricultural produce purchased by him to the seller. The Krishi Upaj Mandi Samiti further has a power to arrange for resale thereof and in the event of loss to recover the same from the original buyer together with charges for recovery of the loss. The Section further casts a duty on the Mandi Samiti to effect payment of price of the agricultural produce to the seller. The Krishi Upaj Mandi Samiti further has a power to arrange for resale thereof and in the event of loss to recover the same from the original buyer together with charges for recovery of the loss. The Section further casts a duty on the Mandi Samiti to effect payment of price of the agricultural produce to the seller. The Adhiniyam, 1972 has been enacted to provide benefit to the agriculturist and also to regulate the sell and purchase of the agriculture produce in order to save the exploitation of agriculturists. The Adhiniyam 1972 is a beneficiary legislation and purpose of the Adhiniyam is to regulate the transaction within the marketyard and one of the purpose of introducing Section 17(2)(xiii)(a) is to ensure payment to the agriculturist for their agriculture produce and also to recover the same from the buyer, who failed to make payment to the agriculturists. 11. The Constitution Bench of the Hon'ble Supreme Court in the case of Union of India v. Elphinstone Spinning and Weaving Co. Ltd. and Ors. reported in (2001)4 SCC 139 has held as under in regard to interpretation of statute regulating the interest of the parties: 10. In the Doypack System Pvt. Ltd. v. Union of India (1988) 2 SCC 299 the Court had observed that when the constitutionality of a legislation is being assailed before a Court it is the collective will of the Parliament with which the Court is concerned. No officer of the department can speak for the Parliament. The interpreter of the statute must take note of the well known historical facts. In conventional language the interpreter must put himself in the armchair of those who were passing the Act i.e. the Members of the Parliament. It is the collective will of the Parliament with which we are concerned. The aforesaid observation had been made in the context of an argument sought for by the Petitioner for production of certain documents to ascertain the question whether the shares vested in the Government or not. 11. In Bearer Bonds case (1981) 4 SCC 675 : ( AIR 1981 SC 2138 ), this Court held that it is a rule of equal importance that laws relating to economic activities should be viewed with greater latitude than law touching civil rights, such as freedom of speech, religion etc. The Court observed that (SCC pp. 11. In Bearer Bonds case (1981) 4 SCC 675 : ( AIR 1981 SC 2138 ), this Court held that it is a rule of equal importance that laws relating to economic activities should be viewed with greater latitude than law touching civil rights, such as freedom of speech, religion etc. The Court observed that (SCC pp. 690-91, para 8): It has been said by no less a person than Holmes, J. that the legislature should be allowed some play in the joints, because it has to deal with complex problems which do not admit of solution through any doctrinaire or strait-jacket formula and this is particularly true in case of legislation dealing with economic matters, where having regard to the nature of the problems required to be dealt with, greater play in the joints has to be allowed to the legislature. The Court should feel more inclined to give judicial deference to legislative judgment in the field of economic regulation than in other areas where fundamental human rights are involved. Nowhere has this admonition been more felicitously expressed than in Morey v. Doud (1957) 354 US 457: 1 L Ed 2d 1485 where Frankfurter, J. said in his intimitable style: In the utilities, tax and economic regulation cases, there are good reasons for judicial self-restraint if not judicial deference to legislative judgment. The legislature after all has the affirmative responsibility. The Courts have only the power to destroy, not to reconstruct, the uncertainty, the liability to error, the bewildering conflict of the experts, and the number of times the judges have been overruled by events - self-limitation can be seen to be the path to judicial wisdom and institutional prestige and stability. The Court must always remember that "legislation is directed to practical problems, that the economic mechanism is highly sensitive and complex, that many problems are singular and contingent, that laws are not abstract propositions and do not relate to abstract units and are not to be measured by abstract symmetry"; "that exact wisdom and nice adoption of remedy are not always possible" and that "judgment is largely a prophecy based on meagre and uninterpreted experience". Every legislation particularly in economic matters is essentially empiric and it is based on experimentation or what one may call trial and error method and therefore it cannot provide for all possible situations or anticipate all possible abuses. Every legislation particularly in economic matters is essentially empiric and it is based on experimentation or what one may call trial and error method and therefore it cannot provide for all possible situations or anticipate all possible abuses. There may be crudities and inequities in complicated experimental economic legislation but on that account alone it cannot be struck down as invalid. The Courts cannot, as pointed out by the United States Supreme Court in Secretary of Agriculture v. Central Reig Refining Co. (1950) 94 1 Ed 381 : 338 US 604 be converted into tribunals for relief from such crudities and inequities. There may even be possibilities of abuse, but that too cannot of itself be a ground for invalidating the legislation, because it is not possible for any legislature to anticipate as if by-some divine prescience, distortions and abuses of its legislation which may be made by those subject to its provisions and to provide against such distortions and abuses. Indeed, howsoever great may be the care bestowed on its framing, it is difficult to conceive of a legislation which is not capable of being abused by perverted human ingenuity. The Court must therefore adjudge the constitutionality of such legislation by the generality of its provisions and not by its crudities or inequities or by the possibilities of abuse of any of its provisions. If any crudities, inequities or possibilities of abuse come to light, the legislature can always step in and enact suitable amendatory legislation. That is the essence of pragmatic approach which must guide and inspire the legislature in dealing with complex economic issues. 12. If any crudities, inequities or possibilities of abuse come to light, the legislature can always step in and enact suitable amendatory legislation. That is the essence of pragmatic approach which must guide and inspire the legislature in dealing with complex economic issues. 12. In Ram Krishna Dalmia v. Shri Justice S.R. Tendolkar 1959 SCR 279 : ( AIR 1958 SC 538 ) this Court held: "(a)* * * (b) that there is always a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles; (c) that it must be presumed that the legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds; (d) that the legislature is free to recognise degrees of harm and may confine its restrictions to those cases where the need is deemed to be the clearest; (e) that in order to sustain the presumption of constitutionality the Court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation. 13. In the case of Superintendent and Remembrancer of Legal Affairs West Bengal v. Girish Kumar Navalakha (1975) 4 SCC 754 : ( AIR 1975 SC 1030 : 1975 Cri LJ 874), this Court held (SCC pp. 757-58, para 6): 6. The preamble provides the key to the general purpose of the Act. That purpose is the regulation of certain payments, dealings in foreign exchange and securities and the import and export of currency and bullion in the economic and financial interest of India. The general purpose or object of the Act given in the preamble may not show the specific purpose of the classification made in Section 23(1)(a) and Section 23(1A), The Court has therefore to ascribe a purpose to the statutory classification and co-ordinate the purpose with the more general purpose of the Act and with other relevant Acts and public policies. The general purpose or object of the Act given in the preamble may not show the specific purpose of the classification made in Section 23(1)(a) and Section 23(1A), The Court has therefore to ascribe a purpose to the statutory classification and co-ordinate the purpose with the more general purpose of the Act and with other relevant Acts and public policies. For achieving this the Court may not only consider the language of Section 23 but also other public knowledge about the evil sought to be remedied, the prior law, the statement of the purpose of the change in the prior law and the internal legislative history. When the purpose of a challenged classification is in doubt, the Court attribute to the classification the purpose thought to be most probable. Instead of asking what purpose or purposes the statute and other materials reflect, the Court may ask what constitutionally permissible objective this statute and other relevant materials could plausibly be construed to reflect. The latter approach is the proper one in economic regulation cases. The decisions dealing with economic regulation indicate that Courts have used the concept of "purpose" and 'similar situations' in a manner which give considerable leeway to the Legislature. This approach of judicial restraint and presumption of constitutionality requires that the Legislature is given the benefit of doubt about its purpose. How far a Court will go in attributing a purpose which though perhaps not the probable is at least conceivable and which would allow the classification to stand depends to a certain extent upon its imaginative power and its devotion to the theory of judicial restraint. The Court further held (SCC p. 759, para 10): It would seem that in fiscal and regulatory matters the Court not only entertains a greater presumption of constitutionality but also places the burden on the party challenging its validity to show that it has no reasonable basis for making the classification. 14. The Legislation in a modern State is actuated with some policy to curb some public evils or to effectuate some public benefit. The Legislation is primarily directed to the problems before the legislature based on information derived from past and present experience. It may also be designed by use of general words to cover similar problems arising in future. 14. The Legislation in a modern State is actuated with some policy to curb some public evils or to effectuate some public benefit. The Legislation is primarily directed to the problems before the legislature based on information derived from past and present experience. It may also be designed by use of general words to cover similar problems arising in future. But from the very nature of things, it is impossible to anticipate fully, the varied situations arising in future in which the application of the legislation in hand may be called for, and, words chosen to communicate such indefinite reference are bound to be in many cases, lacking in clarity and precision, and thus giving rise to the controversial question of construction. Bearing in mind the aforesaid general principles, let us now examine the five questions formulated earlier. It is clear from the judgment of the Hon'ble Supreme Court that it is impossible to anticipate fully, the varied situations arising in future in which the application of the legislation in hand may be called for, and, words chosen to communicate such indefinite reference are bound to be, in many cases, in lacking in clarity and precision. 12. If the interpretation put forth by the learned Single judge of Section 17(2)(xiii)(a) of the Adhiniyam, 1972 be accepted then if the Krishi Upaj Mandi Samiti does not seize the agricultural produce in question and sell the same then it is not authorized to auction the property. If a buyer disposed of the agriculture produce on the same date then the Krishi Upaj Mandi Samiti would not have any power to seize and sell the property to the person concerned. In our opinion, this interpretation is contrary to the provisions of Section 17(2)(xiii)(a) because the section clearly authorizes the Mandi Samiti to seize the agriculture produce in question along with other property of the person concerned and arrange for resale in the event of default by a person who is a buyer of agricultural produce within the marketyard of the Mandi Samiti. The intention of the legislation is clear that the legislature wants to ensure the payment to the agriculturists and it has authorized the Mandi Samiti to seize the property and also the agricultural produce of a person concerned, who failed to make payment to the agriculturists on account of purchase of their agricultural produce. The intention of the legislation is clear that the legislature wants to ensure the payment to the agriculturists and it has authorized the Mandi Samiti to seize the property and also the agricultural produce of a person concerned, who failed to make payment to the agriculturists on account of purchase of their agricultural produce. The interpretation putforth by the learned Single Judge if accepted then it would lead some anomaly because if the Mandi Samiti is unable to seize the agricultural produce and does not sell the same in the market then it could not ascertain the loss and, hence, it is not empowered to sell the property of the person. Suppose, if a person transported the agricultural produce on the same date from the marketyard or the Mandi Samiti fails to seize the agricultural produce from the possession of the person concerned on the same difficulties then it has no authority to sell the property of the person. The aforesaid interpretation, in our opinion, is against the plain and simple meaning of Section 17(2)(xiii)(a) because under the section the Mandi Samiti has been authorised to seize the agricultural produce in question along with other property of the person concerned and to arrange for resale thereof. It means that if the Mandi Samiti is unable to seize the agricultural produce in question, then also it has a power to seize other property of the person concerned and resale it thereof, if any further loss is caused to the Mandi Samiti on account of payment of price to the sellers i.e. agriculturists of agricultural produce, then also it has power to recover the loss. It is in consonance with the object of the enactment to recover the amount from the purchaser, who has not paid the amount after purchase of agricultural produce to the agriculturists. 13. In the present case, the Mandi Samiti has ascertained the amount which was not paid by the Respondents to the agriculturists. It has also paid the same to the agriculturists. Even though as stated in the return, the Respondents issued cheques in favour of Komal Singh of Rs. 21003.75/- and in favour of Sangram Singh of Rs. 13. In the present case, the Mandi Samiti has ascertained the amount which was not paid by the Respondents to the agriculturists. It has also paid the same to the agriculturists. Even though as stated in the return, the Respondents issued cheques in favour of Komal Singh of Rs. 21003.75/- and in favour of Sangram Singh of Rs. l,06,880/-on 1-7-1995 but the cheques were dishonoured by the banks, in such circumstances, in our opinion, the Mandi Samiti has rightly initiated the proceedings of auction of the godown of the Respondents and it has power and authority to do so under the provisions of Section 17(2)(xiii)(a) of the Act of 1972. 14. Consequently, the appeal of the Appellants is allowed. The impugned order passed by the learned Single Judge is hereby quashed. The Writ Petition No. 405/1997 filed by the Respondents-firm is hereby dismissed. 15. Looking to the facts of the case, parties are directed to bear their own costs.