JUDGMENT K.M. JOSEPH, J. In this batch of appeals, there are several common questions and, therefore, we dispose of the same by the following common judgment. 2. On 01.11.2011, the Uttarakhand Legislature passed the Uttarakhand Agricultural Produce Marketing (Development and Regulation) Act, 2011 (hereinafter referred to as the “Act”). It, inter alia, provided for the levy of market fee and development cess under Section 27(c)(iii), which read as follows: “(iii) any such agricultural produce, which reaches any Market area of the State for sale, storage, processing or transaction from any other State or out of Country for the first time, it shall be registered as “First Arrival” and on such produce, Market fee and Development cess shall be payable.” 3. Nine writ petitions were filed. A contention was raised by petitioners therein that they were bringing the agricultural produce into the market area for the purpose of manufacture of various products. They also questioned the legislative competence of the State Legislature to enact a law permitting levy of market fee and development cess, as was provided. A learned Single Judge of this Court took the view that the provisions did not contemplate levy of market fee or development cess on agricultural produce, which are brought into the market area for the purpose of manufacture, and the word “manufacture” was not mentioned in Section 27(c)(iii) and, therefore, while upholding the legislative competence of the State to levy the market fee and the development cess as provided, the writ petitions save one were disposed of by issuing a negative mandamus restraining the respondents from collecting market fee / cess. 4. The Legislature of the State responded, apparently, to the judicial verdict by amending the Act and by substituting the following provision in place of Section 27(c)(iii): “(iii) any such agricultural produce, which arrives in any Market area of the State for sale, storage, processing, manufacturing, transaction or other commercial purposes from any other State or out of Country for the first time, it shall be registered as “Primary Arrival” and on such produce, Market fee and Development cess shall be payable.” 5. Para (iv) of clause (c) of Section 27 was also substituted as follows: “(iv) any agricultural produce, which is brought to any Market area within the State after the transaction of sale from any other Market area of the State after paying Market fee and Development cess for the purpose of sale, storage, processing, manufacturing, transaction or other commercial purposes, it shall be called as “Secondary Arrival” and on such produce, no Market fees and Development cess shall be leviable. 6. Still furthermore, a new para (v) was inserted in clause (c) of Section 27, which reads as under: “(v) any agricultural produce, which is brought to any Market area from outside Uttarakhand State for sale, storage, transaction or commercial purpose after paying Market fee and / or Development cess then Market fee and Development cess shall be leviable on such produce: Provided that brought to Market area from outside Uttarakhand State for processing or manufacturing purpose after paying Market fee and / or Development cess from concerning State then it shall be called as “Other Secondary Arrival” and no Market fee shall be leviable however due Development cess shall be leviable.” 7. The said amending Act came into force w.e.f. 01.11.2011. 8. Thereupon, the present writ petitions were filed. In many of the cases, writ petitioners brought Paddy and they were engaged in the processing of Paddy into Rice. In many others, wood was being brought and wood products were being manufactured. Likewise, flour was being brought and products out of the same were being made. Suffice it to say, there is no dispute that the produce, which was being brought in all these cases, fulfills the definition of “agricultural produce”, which reads as follows: “2(i) “Agricultural Produce” means all produce and commodities, whether processed or unprocessed, of agriculture, horticulture, floriculture, viticulture, apiculture, sericulture, pisciculture, animal husbandry, forest produce, as are specified in the Schedule or declared by the State Government, by notification, from time to time, and includes admixture of two or more of such products, processed in form and further includes Gur, Rab, Shakkar, Khandsari and Jaggery.” 9. The substantial contention of appellants is one. What they would contend is that there is no purchase or sale of their products in the Mandi or the Market area to attract the levy of the market fee or development cess. The substantial contention of appellants is one. What they would contend is that there is no purchase or sale of their products in the Mandi or the Market area to attract the levy of the market fee or development cess. It is their case that the agricultural produce is being brought from outside the State of Uttarakhand. In most cases, it has already suffered the market fee and also cess as per law in force in the States from which they have brought the agricultural produce. Therefore, there is no sale as such of the agricultural produce in question within the market area in the State of Uttarakhand. They make use of the agricultural produce, which is brought into the State of Uttarakhand, in the processing or manufacturing of other products; though the final products, which are manufactured, may or may not be included in the list of agricultural produce, which attracts levy of market fee and development cess. What they say is that, without there being any sale or purchase within the market area in Uttarakhand, they are being called upon to pay market fee and development cess. 10. In the writ petitions, the main grounds, which appear to have been projected, are as follows: (i) There is no legislative competence for the State Legislature to make such a provision. (ii) Secondly, they contended that it is not open to the Legislature to nullify the earlier direction issued by the Court, which was in the form of a negative mandamus. The Act is not a validating Act. This Court had not, on the earlier occasion, nullified the previous provisions. It had merely placed its interpretation. Therefore, it is not open to the State Legislature to nullify the earlier judgment by inserting certain words. (iii) The third contention would appear to have been that there is a retrospective operation given to the Legislation, which is impermissible in law and on the facts. 11. The learned Single Judge considered the matter and found no merit in the contentions and the writ petitions have been dismissed. Hence, the present appeals. We are also disposing of the appeals filed by the writ petitioners against the judgments of the learned Single Judge in the earlier round wherein the court inter alia took the view that there is legislative competence. Hence, the present appeals. We are also disposing of the appeals filed by the writ petitioners against the judgments of the learned Single Judge in the earlier round wherein the court inter alia took the view that there is legislative competence. We are also disposing of six appeals filed by the Krishi Utpadan Mandi Samiti against the direction given by the learned Single Judge. 12. We have heard Mr. V.K. Kohli, Senior Advocate; Mr. Rahul Sripat, Advocate; Mr. Manish Arora, Advocate; Mr. Ramesh Singh, Advocate; and Mr. Pankaj Kumar, Advocate, on behalf of the appellants. We have also heard Mr. A.S. Rawat, Addl. Advocate General for the State of Uttarakhand. 13. Mr. V.K. Kohli, learned Senior Advocate, appears for the appellants in Special Appeals Nos. 380 of 2014, 383 of 2014, 379 of 2014, 377 of 2014 and 399 of 2014, wherein Barley, which is an agricultural produce, undoubtedly, is brought into the market area and used in the manufacture of malt. He would complain that there is no legislative competence. He referred us to the preamble of the Act, which reads as follows: “to provide for the effective regulation in marketing of agricultural produce, establishment and development of proper and modern marketing system, promotion of agricultural processing and agricultural export, superintendence and control of markets in the State of Uttarakhand and for the matters connected therewith or incidental thereto.” 14. He would contend that it relates to marketing and there is no reference to manufacturing therein. Still further, he drew our attention to Section 4 of the Act, which reads as follows: “4. Declaration of intention to regulate and to control sale and purchase of agricultural produces in any area. – Where the State Government is of opinion that it is necessary or expedient in public interest to regulate the sale and purchase of agricultural produces in any area and for that purpose to declare that area as a market area, it may, by notification in official gazette and in such other manner, which may be prescribed, declare such area as a Market Area under this Act, with effect from such date, as may be notified.” 15. Therein also, he would point out that the market area is predicated with reference to sale and purchase, which takes place therein. The facilities are to be provided in respect of sale and purchase. Therein also, he would point out that the market area is predicated with reference to sale and purchase, which takes place therein. The facilities are to be provided in respect of sale and purchase. When there is no sale or purchase, as in these cases, there is no legislative competence to levy market fee or development cess with reference to merely bringing in the agricultural produce for the purpose of manufacture. 16. Next, he refers to Section 14 of the Act and points out that there is only reference to sale and purchase. He further relies on Section 26 of the Act. Section 26(1), being relevant, is being extracted hereunder: “26. Functions and Duties of Committee.- (1) A Committee shall enforce the provisions of this Act, the rules and bye-laws made thereunder in the Market Area, provide such facilities for sale and purchase of notified agricultural produces therein, as may be specified in any directions given by the Board to the Committee from time to time or considered necessary by the Committee and do such other acts, as may be necessary for regulating sale and purchase and auction of notified agricultural produces in that market area, and for that purpose may exercise such powers and perform such duties and discharge such functions, as may be provided by or under this Act.” 17. Therein, he emphasized that the reference is again made only to sale and purchase. He complains that, without providing any service, when agricultural produce is merely brought into the market area and used in the manufacture of other products, it is impermissible to levy market fee and development cess. Reference is made to Section 27(c)(ii) of the Act. It reads as follows: “27. The Committee shall, for the purposes of this Act, have the following power; namely- (c)(ii) to collect Market fees, which shall be payable on transaction of sale of specified agricultural produces in the Market area at such rates, being not less than one percent and not more than two and half percent of the price of the Agricultural produce so sold, as the State Government may specify by notification, and to levy and collect such Development cess at such rates being not less than ½ percent and not more than 2 ½ percent of the price of such deal. Such fee or development cess shall be realized in the following manner: (A) if the produce is sold through a commission agent, the commission agent may realize the Market fee and Development cess from the purchaser and shall be liable to pay the same to the Committee; (B) if the produce is purchased directly by a trader from a producer, the trader shall be liable to pay the Market fee and Development cess to the Committee; (C) if the produce is purchased by a trader from another trader, the trader selling the produce may realize Market fee and Development cess from the purchaser and shall be liable to pay it to the Committee; Provided that if the purchaser is only license holder, then he shall be liable to pay Market fees and Development cess; (D) in any other case of sale of such produce, the purchaser shall be liable to pay the Market fee and Development cess to the Committee; Provided that no Market fee or Development cess shall be levied or collected on the retail sale of any specified agricultural produce, where such sale is made to the consumer for his domestic consumption only; Provided further that the seller of the produce shall not be exempted from payment of Development cess on the ground that he has not recovered the same from the purchaser.” Thus, sale or purchase, it is submitted, is the sine qua non to justify the levy. He would also submit that the impugned enactment is violative of Article 301 and it is not protected by Article 304 of the Constitution of India. 18. Mr. Rahul Sripat, Advocate, appears for the appellant in Special Appeal No. 401 of 2014, wherein the agricultural produce is cotton and the appellant manufactures cotton rayon. He would emphasize that there is no sale or purchase in the market area. He would submit that the market fee and cess are already paid in the other States from which he has brought the goods into the State of Uttarakhand. He would point out that there is no law, which has received the assent of the President within the meaning of Article 304, and, therefore, the levy of market fee and development cess is a clear violation of Article 301 of the Constitution of India. He would also submit that there is no basis at all to give retrospectivity to the law. He would also submit that there is no basis at all to give retrospectivity to the law. He further adopts the arguments of the learned Senior Advocate Mr. V.K. Kohli. He would also submit that, in the statement of objects and reasons, there is no reference to manufacture. No doubt, he submits that on cotton wastage, a nominal amount is being paid as market fee. He complains that there are no amenities, including roads, being made available and he poses the question, on what basis, market fee is being levied. He would further draw our attention to Section 27(c)(v) of the amended Act and would submit that cess is a part of fee and, when there is no liability to pay fee, how a cess could be levied. 19. Mr. V.K. Kohli, learned Senior Advocate, also appears in many other appeals, where the appellants bring Paddy and Rice is made out of it. He would also point out that Paddy is brought in after paying the market fee and cess. He would submit that, after removing the husk and the rice bran, the final product Rice emerges. In fact, the learned Senior Counsel would submit that there is only processing. In this connection, he would submit that a perusal of Section 27(c)(v) would demonstrate that the word “processing” is conspicuous by its absence in the said provision. This means that the Legislature, rightly, did not intend to levy market fee and development cess, when products like Paddy are brought from outside the State for processing, which have suffered levy of market fee and development cess outside the State. These arguments are, apparently, in addition to the other arguments relating to the legislative competence and retrospectivity. 20. Mr. Manish Arora, Advocate, appears on behalf of the appellants in 26 appeals. Therein, the appellants bring wheat from outside the State for use in flour mills located in the market area. They procure the agricultural produce wheat from Delhi, Uttar Pradesh, Bihar and Rajasthan. In Delhi, market fee is not levied as it is exempted there. In rest of the States, from where they procure the raw material, namely, wheat, which is admittedly an agricultural produce, market fee is levied. He does not dispute that, when Mandi fee is already paid, only cess is being demanded. In Delhi, market fee is not levied as it is exempted there. In rest of the States, from where they procure the raw material, namely, wheat, which is admittedly an agricultural produce, market fee is levied. He does not dispute that, when Mandi fee is already paid, only cess is being demanded. He would point out that, when wheat is used to produce atta, maida and suji, they are not agricultural products and, therefore, the levy is bad. He draws our attention to the judgment in the case of Lala Ram (D) by LR & others vs. Union of India & another, reported in 2013 (2) RCR (Civil) 73. This is to buttress his argument that the retrospectivity given is unsustainable. 21. Mr. Ramesh Singh, Advocate, appears on behalf of the appellants in Special Appeals Nos. 382 of 2014 and 384 of 2014. Therein, Maize is the agricultural produce. It is brought into the market area in Uttarakhand and used in the factory located within the market area to manufacture starch and other products. He would submit that the State Legislature has no legislative competence. He draws our attention to Entry 28 of List II of the Seventh Schedule of the Constitution of India, which reads as follows: “28. Markets and fairs.” 22. Entry 66 of List II empowers the State to make laws relating to levy of fees in respect of matters covered by Entry 28. He would contend that, in this case, the State Legislature has exceeded its legislative power in enacting the law. He would contend that the Industries in question are covered by Entry 52 of List I, which is within the exclusive province of the Parliament. He drew our attention to the Industries (Development and Regulation) Act, 1951 and drew our attention to the industries therein to contend that the industries or the manufacturing units as concerned in these cases are indeed covered by Entry 52 of List I. If that be so, he poses the question as to how the State Legislature, in exercise of its purported legislative power, which is traceable to Entries 28 and 66 of List II, could make a law impinging on the legislative power, which is exclusively available to Parliament. In other words, when, admittedly, the agricultural produce is being brought into the market area and it is being used in the manufacture of final products in an industry, which is covered by Entry 52 of List I; clearly, the State Legislature was exceeding its legislative powers in imposing the impugned market fee and development cess. He drew our attention to the judgments of the Apex Court rendered in the case of Belsund Sugar Co. Ltd. vs. State of Bihar & others, reported in (1999) 9 SCC 620 , and the case of ITC Ltd. vs. Agricultural Produce Market Committee & others, reported in (2002) 9 SCC 232 , in this regard. He also drew support from the absence of the word “manufacture” and the presence of the words “purchase and sale” in Sections 4, 26 & 27 of the Act. He contended that the word “storage” can bear valid constitutional meaning only when storage is for purpose of sale or purchase. 23. He would, next, contend that this is a case, where the impugned action is violative of Articles 14 and 19 of the Constitution of India. He would further contend with reference to Sections 26 and 27 of the Act that this is a case, where, even if there is a valid Section which provides for a levy, there is no provision for computation of the liability. Section 26 of the Act speaks about the market fee and development cess being levied with reference to the sale price. He poses the question as to how the market fee and development cess could be computed in a case, where there is no sale of the agricultural produce within the market area in Uttarakhand, as in these cases. In this regard, he invoked the principle laid down in the case of Nalnikant Ambalal Mody vs. Commissioner of Income-Tax, Bombay, reported in (1966) Supp. SCR 295, and also the decision in the case of CIT, Bangalore vs. B.C. Srinivasa Setty, reported in (1981) 2 SCC 460 . 24. He also contended that this is a case, where retrospectivity is given to the law made in January, 2013 w.e.f. 01.11.2011. He would complain that this is not a piece of validating legislation. This is also not a legislation, which purports to cure any defect. It is not clarificatory, contends the learned counsel. 24. He also contended that this is a case, where retrospectivity is given to the law made in January, 2013 w.e.f. 01.11.2011. He would complain that this is not a piece of validating legislation. This is also not a legislation, which purports to cure any defect. It is not clarificatory, contends the learned counsel. It is a clear case of a new levy and, in such a case, he points out, it will be violative of Articles 14 and 19 of the Constitution of India to levy a new tax with retrospective effect. In this connection, he sought considerable support from the judgment of a learned Single Judge, Justice H.L. Dattu, as His Lordship then was, of the Karnataka High Court, which is passed in the case of Shamanur Kallappa & Sons vs. State of Karnataka & another, reported in 136 STC 132 (Karnataka). He would also submit that, what the Legislature has purported to do by the impugned Legislation, is to purport to nullify or overrule the previous judgment issuing a negative mandamus of this Court, which is impermissible in law. In this connection, he drew our attention to the judgment of the Apex Court rendered in the case of S.R. Bhagwat and others vs. State of Mysore, reported in (1995) 6 SCC 16 . 25. Mr. Pankaj Kumar, Advocate, who appears on behalf of the appellant in Special Appeal No. 66 of 2013, would adopt the submissions of Mr. Ramesh Singh, Advocate. Besides, he would submit that, when the present State of Uttarakhand was a part of the State of Uttar Pradesh, in Uttar Pradesh, there was a market Legislation and, under the same, there was no provision for levy of market fee or cess in respect of goods brought in for the purpose of processing or manufacture. Ramesh Singh, Advocate. Besides, he would submit that, when the present State of Uttarakhand was a part of the State of Uttar Pradesh, in Uttar Pradesh, there was a market Legislation and, under the same, there was no provision for levy of market fee or cess in respect of goods brought in for the purpose of processing or manufacture. He would, next, contend that, under Section 27(c)(iv), if agricultural produce has been subjected to market fee and development cess already in the State of Uttarakhand in one Mandi, clause (iv) provides that no market fee or development cess will be collected when it enters into another Mandi in the State of Uttarakhand; whereas, a perusal of clause (v) with the proviso would show that there is clear discrimination, which is that, when goods on which market fee and cess has been levied in a State outside the State of Uttarakhand and the same is brought into the State of Uttarakhand and it enters into a Mandi area, then market fee and cess is again levied. The proviso speaks about levy of development cess when goods are brought from outside into the market area in Uttarakhand for the purposes of processing or manufacturing. Therefore, he would submit that this demonstrates the presence of discrimination as between goods originating in the State of Uttarakhand and the goods, which are brought from outside. He would also contend that the impugned levy is violative of Article 301 of the Constitution of India. 26. Per contra, Mr. A.S. Rawat, learned Addl. Advocate General, would submit that there is, indeed, legislative competence. He would, in fact, contend that a perusal of the judgment would show that the appellants had not really pressed the plea of legislative competence. At any rate, he would submit that there is legislative competence, as the matters are covered by Entry 28 and also Entry 66 of List II of the Seventh Schedule. He would submit that the issue raised by Mr. Ramesh Singh, Advocate, relating to the effect of Entry 52 of List I, is without any basis. In this regard, he sought to draw support from the judgment of the Constitution Bench in the case of ITC Ltd. vs. Agricultural Produce Market Committee & others (supra). He would submit that the issue raised by Mr. Ramesh Singh, Advocate, relating to the effect of Entry 52 of List I, is without any basis. In this regard, he sought to draw support from the judgment of the Constitution Bench in the case of ITC Ltd. vs. Agricultural Produce Market Committee & others (supra). He would submit that, as long as there is no dispute that agricultural produce is brought into a market area, for the specified purpose, which, in this case, is manufacture; the said act is sufficient to levy market fee and development cess. The fact that the agricultural produce as raw material is used by an industry covered by Entry 52 of List I will not, in any way, deprive the State Legislature of power to levy market fee or cess in respect of the transaction, which is well within the province of the State Legislature. The bringing of the agricultural produce into the market area for manufacture attracts the levy of market fee / cess, which the State Legislature is, indeed, competent to impose. Both the transactions are distinct. That is to say, the Central enactment relied on by the appellants traceable to Entry 52 of List I, no doubt, relates to the industries declared to be of importance. Therein, manufacture would necessarily take place. The State enactment, namely, the Market Legislation in this case, is not concerned actually with the act of manufacture. It is, rather, concerned with the stage anterior to the process of manufacture and, therefore, the levy is perfectly supportable. 27. He would further submit that the Court must be alive to and appreciate the scheme of the Act and the Court must consider the purpose of the enactment. He would submit that the central idea of the enactment is to protect the producers of agricultural produce. Goods are bought and sold in the market. The activities in the market must be regulated. For this, funds are required. Facilities must be provided. They include roads, sheds, electricity, water, etc. Even though the primary activity, which takes place within the market area, may be selling and buying and Sections 4, 26 and 27 of the Act may refer to the act of selling and buying; the important thing is that, to regulate the area, the Committees are constituted. They are empowered and also expected to discharge various functions. Even though the primary activity, which takes place within the market area, may be selling and buying and Sections 4, 26 and 27 of the Act may refer to the act of selling and buying; the important thing is that, to regulate the area, the Committees are constituted. They are empowered and also expected to discharge various functions. Various facilities and amenities spring-up as a result of the duties and functions and powers vested with the Committees. In particular, he drew our attention to Section 31 of the Act. Section 31 provides as follows: “31. Market Committee Fund and its Utilization.- (1) There shall be established for each Committee, a fund, which shall be called “Market Committee Fund” to which shall be credited all moneys, received by it including all loans, raised by it, advances and grants made to it. (2) All expenditure incurred by the Committee in carrying out the purposes of this Act, shall be defrayed out of the said fund, and the surplus, if any, shall be invested in such manner, as may be prescribed. (2) All expenditure incurred by the Committee in carrying out the purposes of this Act, shall be defrayed out of the said fund, and the surplus, if any, shall be invested in such manner, as may be prescribed. (3) Without prejudice to the generality of the provisions contained in clause (e) of section 27, the Committee may utilize its funds for payment of all or any of the following:- (a) expenses, incurred in auditing the accounts of the Committee; (b) salaries and allowances including allowances for leave, gratuities, compassionate allowance, medical aid and contribution towards provident fund of the officers and employees, appointed by the market committee; (c) expenses of and incidental to elections under this Act; (d) the principal amount of or interest on loans and advances referred to in clause (xiv) of sub-section (2) of section 26; (e) the rent of and taxes on any land and building in possession of the Committee; (f) traveling allowance of the members of the Committee; (g) cost of land or buildings, acquired for the purposes of this Act; (h) cost of maintenance, development and improvement of the Market Yards; (i) expenses in providing facilities and comforts such as shelter, shed, parking accommodation and water and other amenities for persons, draught-cattle, pack animals and vehicles coming to the Market Area and on agricultural improvement and development of agricultural marketing in the Market Area, including the construction, maintenance and repair of Link Roads, Culverts, Bridges and other such purposes; (j) loans and advances to the employees of the Committee; (k) expenses for providing facilities like grading, standardization, quality certification services to the agriculturists in the Market Area; (l) expenses on research of agricultural produce processing and marketing; and (m) such other expenses, as may be prescribed by the Board or the State Government; Provided that the Marketing Committee shall spent compulsorily 2% of the annual income of Market fee according to the provisions of clause (l) of above sub-section (3). 4. Every market committee shall, out of its net income (Mandi fee + License fee) of the financial year, pay to the Board as contribution, as the State Government may, by notification, declare from time to time. 5. 4. Every market committee shall, out of its net income (Mandi fee + License fee) of the financial year, pay to the Board as contribution, as the State Government may, by notification, declare from time to time. 5. Every Market Committee shall have to pay every month the whole amount of the Development Fund, which it has collected, to the Board, which shall be deposited in the “Kendriya Mandi Fund”, as prescribed under section 62.” 28. Next, he refers to Section 61 of the Act and, finally, to Section 62, which are reproduced herein below: “61. Uttarakhand Marketing Development Fund.- (1) There shall be established for the Board, a separate Fund, to be called “the Uttarakhand Marketing Development Fund”, to which the following amounts shall be credited; namely- (a) all contributions, received from the Committees under sub-section (4) of section 31, except such percentage thereof, as the State Government may direct to be credited to the Board’s fund; (b) such other amounts, as the State Government or the Board may direct. (2) The fund established under sub-section (1) shall, subject to the provisions of this Act, be utilized by the Board for the following purposes; namely- (a) facilities to the Agriculturists, other producers and payers of Market fee in the Market Area; (b) development of Principal Markets Yards, Sub market Yards, Hats and Painths, Collection Centers and Construction of Rope-ways and Construction of New Market Yards in the Market area; (c) construction, maintenance and repairs of Link Roads, Market Lanes, Rope-Ways, Hand-Pumps and Tanks and other development works in the Market area; (d) market survey and research, grading and standardization of specified agricultural produce; (e) propaganda, publicity and extension services and the matters relating to the general improvement of the conditions of buying and selling of specified agricultural produce; (f) aid to financially weak and under-developed committees in the form of loans and grants; (g) better development of market areas and control of Market Committees; (h) technical assistance to the Market Committees in the preparation of site plans and estimates of construction and in the preparation of project reports of master plans for development of Principal Market Yards and Sub market Yards and Market area; (i) matters specified in section 26 and 27, which are not covered by the preceding clauses; (j) any other purpose, to give effect to the provisions of this Act or generally to regulate marketing of specified agricultural produce; Provided that to construct link roads and lanes and maintenance thereof, maximum of 25 percent of this fund shall be spent. 62. Kendriya Mandi Fund.- (1) There shall be established a fund to be called “Kendriya Mandi Fund”, which will be operated by the Managing Director and in which the following amounts shall be credited; namely- (a) all amount of Development cess received from the Mandi Samities under sub section (5) of section 31; (b) such other amounts, as the State Government or the Board may direct. (2) The Kendriya Mandi Fund be utilized for the following purposes, namely- (a) aid to financially weak and under developed Committees in the form of loans and grants; (b) development works in the hilly areas; (c) expenditure involved on the value addition and processing of agricultural produce; (d) any other purposes, as per the direction of the State Government or the Board.” 29. He would, therefore, point out that there is a scheme, which is present and runs through the enactment, losing sight of which, can lead the Court to being directionless in its inquiry to find out the substance of the matter. When facilities are available for market area, persons like the appellants, who have located their units in the market area, undoubtedly, would be the beneficiaries, directly or indirectly, of the same. They avail the said facilities. He poses a question, can a levy be questioned by those, who derive benefit, may be indirectly? There is no need for a quid pro quo, he contends. He draws our attention to the judgment of the Apex Court rendered in the case of Sreeniwasa General Traders & others vs. State of Andhra Pradesh & others, reported in (1983) 4 SCC 353 . As far as the judgment in the case of Belsund Sugar Co. Ltd. (supra) is concerned, he would submit that, that is a case, where the Apex Court took the view that, as far as the sugarcane is concerned, it exclusively fell within the domain of Parliament, as every aspect relating to sugarcane was regulated and the field is occupied. In such circumstances, effort by the State Legislature to legislate under market legislation was found to not square with the Parliamentary Legislation and, therefore, it is on the said basis that the judgment came to be rendered. 30. He would draw our attention to the judgment of the Apex Court rendered in the case of National Agricultural Cooperative Marketing Federation of India Ltd. & another vs. Union of India & others, reported in (2003) 5 SCC 23 in regard to the plea of the appellants against the retrospective nature of the levies. He would submit that, to enact a law with retrospective effect, is well within the powers of the sovereign Legislature, which a State Legislature is, with regard to matters provided under its sway under the constitutional scheme, which is to be found in Articles 245 and 246, no doubt, read with Article 254, of the Constitution of India. There has been no transgression of the limits of the State’s legislative competence, he contends. There has been no transgression of the limits of the State’s legislative competence, he contends. He would submit further that, in this case, even before the judgment in the first batch of cases by the learned Single Judge was rendered, wherein the Court noticed the absence of the word “manufacture” in Section 27(c)(iii); the Legislature had stepped-in and made an amendment, by which, it had included the word “manufacture” inter alia. The amendment was, in fact, notified after two days of the rendering of the judgment, i.e. on 03.01.2013 w.e.f. 01.11.2011, and the amendment was already passed by the Legislature. This is not a case of nullifying the judgment of the Court. In fact, there were earlier demands raised under the old Act. The State was contending that the word “processing”, which is already available in Section 27(c)(iii), would take within its fold the act of manufacture. The perception may have been wrong; but, nonetheless, it was pursued and, when it was realized that an amendment may be necessary, it was immediately done. He points out that the original enactment was made on 01.11.2011. The amendment was carried out w.e.f. 01.11.2011 on 03.01.2013. Therefore, the period of retrospectivity is only about 14 months. He would submit that one of the parameters, which has been evolved by the Courts to sustain a retroactive fiscal Legislation, is that such a retroactive Legislation is not harsh. In this context, the Court may notice that proceedings were already afoot; the parties were put on notice; and the matter was under the consideration of the Court. Having regard to the facts present in this case, there cannot be any complaint of the retrospective operation being harsh. It is submitted that this must be treated as a case, where the Legislature was curing the defect, which is pointed out by the Court, namely, the absence of the word “manufacture” in Section 27(c)(iii), which was the sole basis for the learned Single Judge to interfere with the notices and the issuance of the mandamus. The learned Addl. Advocate General submits that it is open to the Legislature to remove the foundation for the judgment and that would not amount to interfering with the judgment or nullifying the judgment. The learned Addl. Advocate General submits that it is open to the Legislature to remove the foundation for the judgment and that would not amount to interfering with the judgment or nullifying the judgment. With the introduction of the word “manufacture” inter alia and also clause (v), along with its proviso, he would submit that the foundation for the earlier judgment ceases to exist. He would submit that the mere absence of the validating Act as such would, in fact, not be fatal and, in this regard, he sought to draw support from the judgment in the case of National Agricultural Cooperative Marketing Federation of India Ltd. & another vs. Union of India & others (supra). 31. He would, then, contend that the scheme of Section 27 of the Act may be noticed. When goods are brought from outside the State of Uttarakhand, which have not suffered any levy of market fee or cess, they are treated as “first arrival” provided they are brought for the purposes, which are mentioned therein. After the amendment with retrospective effect and in view of the inclusion of the word “manufacture” and “other commercial purposes”, entry of agricultural produce for the aforesaid purposes also would invite levy of market fee and cess. This is what is provided in Section 27(c)(iii). Section 27(c)(iv) declares that, when goods have already suffered market fee and cess within the State of Uttarakhand in any market area, they will not be further subjected to market fee or cess in another market area in the State of Uttarakhand. Then, he refers to clause (v) and would submit that the said provision provides that, when goods are brought from outside Uttarakhand and market fee and cess have been levied outside the State of Uttarakhand, when they enter any Mandi in the State of Uttarakhand, market fee and cess will be payable. Then, finally, he refers to the proviso to clause (v) and contends that it specifically relates to agricultural produce being brought into a Mandi in the State of Uttarakhand from outside the State of Uttarakhand for the purposes of processing or manufacturing, which words are conspicuous by their absence in the main provision of clause (v). Then, finally, he refers to the proviso to clause (v) and contends that it specifically relates to agricultural produce being brought into a Mandi in the State of Uttarakhand from outside the State of Uttarakhand for the purposes of processing or manufacturing, which words are conspicuous by their absence in the main provision of clause (v). He further contends that the proviso provides that, in a case covered by the proviso, namely, when agricultural produce is brought into a market area in the State of Uttarakhand from outside Uttarakhand, where the goods have already been visited with a levy of market fee and cess, then, only development cess would be payable. This, according to him, is the scheme of the Act, as amended. He would submit that a perusal of the above provisions would show that there is no discrimination, as alleged, between the persons, whose produce suffered market fee and cess, being exempted from further levy under clause (iv) and the case of goods being brought from outside the State of Uttarakhand, which have already been imposed with market fee and cess, being called upon to pay fee and development cess. He would submit that, in these cases, if the goods of the appellants have already suffered levy of market fee and cess and are brought from outside, where they have so suffered the levies, they are being called upon to pay only the development cess under the proviso to clause (v). He would submit that all that the law contemplates is that there must be, at least, one levy of market fee and cess in regard to a Mandi into which goods are brought within the State of Uttarakhand. Therefore, when persons bring agricultural produces from outside the State, though the same may have suffered Mandi fee and development cess outside the State; there can be nothing illegal in calling upon the persons to pay, at least, a development cess, in a case, where goods are brought in for processing or manufacturing, as contemplated in the proviso to clause (v). 32. The learned Addl. Advocate General would contend that no market fee or cess is leviable when there is only personal consumption. 32. The learned Addl. Advocate General would contend that no market fee or cess is leviable when there is only personal consumption. This is, obviously, in response to the case of the appellants that, if storage, as mentioned in this provision, is carried to its logical conclusion, even persons storing agricultural produce for their personal use will theoretically be liable to be visited with the market fee and cess. According to the learned Addl. Advocate General, the law is purely a regulatory law, which is intended to really protect the producers. He would submit that the cess will partly go into the development of hilly areas, where there are no sufficient means for the producers to market their goods due to the absence of proper roads. Therefore, the ultimate purpose will be the protection of the producers of agricultural produce. 33. In reply, Mr. Ramesh Singh, Advocate, would refer to paragraph 28 of the counter affidavit and emphasize that there is nothing to show that any service is being rendered by the respondents. He also drew our attention to paragraph 107 of the judgment in the case of Belsund Sugar Co. Ltd. vs. State of Bihar & others (supra). 34. Mr. V.K. Kohli, learned Senior Counsel, who, in fact, in his original arguments, submitted that, when Paddy is used for the production of Rice, what is involved is processing; would, now, contend that, actually, what is involved is manufacturing. He drew our attention to paragraphs 130 and 131 of the judgment in the case of Belsund Sugar Co. Ltd. vs. State of Bihar & others (supra). He would, in fact, submit that, when Husk is removed from Paddy, there is processing; but, after removal of Rice Bran when Rice emerges, there is manufacturing. Appellants would point out the exorbitant nature of the levy, i.e. 2 ½ per cent of the price of the product. In fact, the learned counsel would submit that the Malt Industry is extremely competitive and appellants are losing out to producers from other regions. 35. Mr. Manish Arora, Advocate, referred to Ground A(d) in Writ Petition (MS) No. 2297 of 2013. It reads as follows: “d) In the present case, undisputably the petitioner is not undertaking any activity of sale of notified agricultural produce brought by it from outside the State. 35. Mr. Manish Arora, Advocate, referred to Ground A(d) in Writ Petition (MS) No. 2297 of 2013. It reads as follows: “d) In the present case, undisputably the petitioner is not undertaking any activity of sale of notified agricultural produce brought by it from outside the State. In fact the activity of storage and processing of the said agricultural produce is directly in connection with using the said agricultural produce as part of manufacturing process / activity of Rice, Rice Husk and Rice Bran.” 36. Mr. Rahul Sripat, Advocate, referred to paragraph 34 of Writ Petition (MS) No. 523 of 2013 and reiterated that there are no facilities being available and there is no pleading to show that any facility is being made available at all. He would also appeal to the spirit of the Act to point out that, without there being sale or purchase, there cannot be a market fee or cess levied. 37. In our view, the following questions would arise for our consideration: i. Whether there is legislative competence with the State Legislature to have enacted the impugned provisions? ii. Whether the retrospective levy is justified? iii. Whether the impugned Legislation amounts to nullification of a binding judgment of this Court and, hence, bad? iv. Whether there is discrimination between goods brought from outside and goods produced within the State? v. Whether there is violation of Article 301 of the Constitution? vi. Whether there is violation of Articles 14 & 19 of the Constitution? vii. Whether the levy is bad for the reason that there are no computation provisions in place? 38. Whether there is legislative competence with the State Legislature to have enacted the impugned provisions? i. The very first question, which we must consider, is the issue relating to Legislative Competence. Entry 28 of List II of the Seventh Schedule provides for legislative competence for States in respect of Markets and Fairs. ii. Besides the same, in keeping with the scheme of the Constitution, Entry 66 of List II provides for power with the State Legislature to levy fees in respect of any matter coming under List II. iii. We are not impressed with the argument of the appellants that, in view of the provision in the Preamble to the Act or the spirit of the Act, the impugned legislative provisions must be invalidated. iii. We are not impressed with the argument of the appellants that, in view of the provision in the Preamble to the Act or the spirit of the Act, the impugned legislative provisions must be invalidated. The argument appears to be that the Preamble does not refer to manufacturing and, therefore, bringing of agricultural produce into the market area for use in manufacture cannot be the subject matter of a valid levy of market fee and cess. We are of the view that the acceptance of the appellants’ argument involves an over-estimation of the function of the Preamble vis-à-vis the clear provisions of the Statute. While a Preamble may be used as a key to open the mind of the Legislature in case of ambiguity in the provisions of the Statute; where the provisions of the Statute are clear, the Preamble must necessarily fade into insignificance. Having regard to the provisions contained in the impugned Legislation, there can be no doubt that the Legislature has intended levy of market fee / cess on agricultural produce brought into the market area for the purpose of manufacturing, inter alia. iv. Equally without merit is the reliance placed on the wording of Section 4 of the Act. Section 4 contemplates setting-up of a market area, undoubtedly, for the purpose of regulating sale and purchase therein. It is, in this context, to appreciate that market legislation has a long history behind it. In the case of MCVS Arunachala Nadar & others vs. State of Madras & others, reported in AIR 1959 SC 300 , the Apex Court elaborately dealt with this phenomenon of market legislation. It was found that the producers of agricultural produce were not getting a fair deal. There were unscrupulous traders and middlemen, who were exploiting the financial condition of the farmers / producers and it was, essentially, to deal with this problem, market regulation came about. After more than five decades, market legislation has become more sophisticated and complicated, apparently, on account of the growing needs and aspirations, which were to be fulfilled by the concerned authorities. It may be, undoubtedly, true that the primary function of the authorities in a market legislation is the regulation of buying and selling of agricultural produce; but, as the Addl. It may be, undoubtedly, true that the primary function of the authorities in a market legislation is the regulation of buying and selling of agricultural produce; but, as the Addl. Advocate General would point out, while this may be the prime object of the market legislation, it becomes necessary for the authorities to make available a host of facilities. The facilities may include roads, water, electricity and various market yards and various other facilities. This necessarily is by way of regulating trade. The primary object is to put in place circumstances in which the producer of agricultural produce gets a fair return. There can be no doubt that this is the prime object. The producer must be given facilities. He must be protected from exploitation by a middleman. Most market legislations provide for the maximum amount, which can be collected by traders. (We may just say we are not too sure whether it is being implemented properly), but the object of the enactment, primarily, is the protection of the producers of agricultural produce. Provision of these facilities, obviously, requires funds. There may be persons other than those, who are involved in buying and selling, who may also benefit from the facilities. They may benefit from the facilities directly or indirectly. If a manufacturing unit, for instance, is located in the market area and if facilities are provided, even though they are provided primarily for the benefit of the producers, who may be bringing the agricultural produce for selling it in the market area; the persons, who are bringing the agricultural produce for manufacturing, located in the market area, without carrying out any purchase or sale of the same within the market area, would be benefiting from the facilities. If it is viewed in this context, then, the fact that Section 4 of the Act speaks about declaration of a market area for the purpose of regulating sale and purchase will not detract from the power of the Legislature to levy market fee and / or cess, if it is otherwise empowered to do so. v. Equally unacceptable is the argument of the appellants based on Section 27 of the Act. In Section 27(c)(ii), there is reference to collection of market fee on the transaction of sale. Clauses (iii), (iv) & (v) would appear to us to be independent provisions dealing with specified contingencies. v. Equally unacceptable is the argument of the appellants based on Section 27 of the Act. In Section 27(c)(ii), there is reference to collection of market fee on the transaction of sale. Clauses (iii), (iv) & (v) would appear to us to be independent provisions dealing with specified contingencies. The Legislature has clearly provided for the levy of market fee and development cess, as provided in these provisions, in respect of agricultural produce reaching the market area for the specified purposes. They include sale, storage, processing, manufacturing, transaction or commercial purposes, as far as clause (iii) is concerned after the amendment. The amendment takes effect from 01.11.2011. At this juncture, it is also necessary for us to unravel the scheme of the various provisions contained in clauses (iii), (iv) & (v) of Section 27(c) of the Act. As far as clause (iii) is concerned, after the amendment, any agricultural produce, which is brought into the market area in the State of Uttarakhand for sale, storage, processing, manufacturing, transaction or other commercial purposes from any other State or outside India, for the first time, is to be treated as “primary arrival” and, on such produce, both market fee and development cess is to be paid. The word “first arrival” is defined in Section 2(xx) of the Act and it reads as follows: “(xx) ‘First Arrival’ means such notified agricultural produce, which reaches Market Area for sale, storage or transaction, upon which no market fee has been paid, even if it has been brought to that Market Area from any other Market Yard or Market Area or State or India.” As far as clause (iv) is concerned, it deals with agricultural produce brought into the market area within the State after there has been a transaction of sale from any other market area of the State, wherein market fee and development cess have been paid, for the purpose of sale, storage, processing, manufacturing, transaction or other commercial purposes, it is to be treated as “secondary arrival” and, on such produce, no market fee and development cess is leviable. Thereafter, we have clause (v). It is to be noticed that both clause (iii) and clause (v) deal with agricultural produce, which is brought to any market area from outside the State. Both deal with agricultural produce brought for sale, storage, transaction or commercial purposes. Thereafter, we have clause (v). It is to be noticed that both clause (iii) and clause (v) deal with agricultural produce, which is brought to any market area from outside the State. Both deal with agricultural produce brought for sale, storage, transaction or commercial purposes. The distinctions are, however, as follows: a. Whereas clause (iii) covers agricultural produce brought for processing and manufacturing also; these words are conspicuous by their absence in clause (v). b. The second difference is that, in regard to clause (iii), it contemplates a situation, where, apparently, no market fee and / or cess has been paid; whereas, clause (v) deals with a situation, where, outside the State of Uttarakhand, the producer has been subjected to market fee and / or development cess. vi. In the case of goods, which are brought for the purposes mentioned in clause (v) and there has already been levy of market fee and / or development cess outside the State of Uttarakhand; then, clause (v) declares that market fee and development cess will be levied on the said produce. The proviso deals with the situation, which is not provided in the main provision (clause v). That is to say, it deals with a situation, where the agricultural produce is brought from outside the State of Uttarakhand for two purposes, namely, processing or manufacturing, and where market fee and / or development cess from the concerned State has been paid; then, it is to be treated as “other secondary arrival” and, on such agricultural produce brought into the market area from outside Uttarakhand State, market fee will not be payable and development cess, alone, shall be leviable. vii. We would think that this is the interpretation, which places harmonious construction on the various clauses, which we have referred to. viii. It is true that Section 26 of the Act speaks about the duties and functions of the Committee and, therein, there is reference to facilities for sale and purchase of notified agricultural produce. The Committee is also to do such other acts, as may be necessary for regulating sale and purchase and the auction of notified agricultural produce in the market area. It is for the said purpose that powers may be exercised and duties may be performed and functions discharged, as provided in the Act. The Committee is also to do such other acts, as may be necessary for regulating sale and purchase and the auction of notified agricultural produce in the market area. It is for the said purpose that powers may be exercised and duties may be performed and functions discharged, as provided in the Act. Sub-section (2) of Section 26 provides for the powers, which, without prejudice to the generality of the provisions in sub-section (1), the Committee is to perform. We noticed that, among the functions, suitable amenities are to be provided in the principal market yard and sub market yards to the producers and the persons engaged in the transactions of sale or purchase therein and, in particular, to construct, repair and maintain roads, pathways, market lanes and bye-lanes, shops, shelters, parking places, accommodation for storage and other amenities, which may be prescribed. There is, then, reference to the functions like arrangements for construction of link roads, pathways, jeepable roads, ropeways, mule path, pulia and water tanks; agricultural processing is to be promoted and undertaken; electronic trading is to be promoted and encouraged; the Committee may establish regulatory system and infrastructure. Clause (xix) provides for performance of other functions and duties, as may be prescribed by the Board or the Managing Director. ix. It is, thereafter, that the powers of the Committee are enumerated in Section 27 of the Act. They are issuances of licences; suspension and cancellation of licences; levy of fees; realization of interest, etc. The Committee may also exercise such other powers, which may be prescribed by the State Government. x. No doubt, there is a case for the appellants that, since Section 26 provides for the statutory functions of the Committee and they are all enumerated with reference to transaction of sale and purchase and there is no reference to manufacturing in Section 26, therefore, there is no statutory duty on the part of the Committee to provide for any facilities for manufacturing units, which are located within the market area, and, therefore, there is no authority with the Committee to realize any fees or cess from the manufacturing units, which merely bring agricultural produce and, that too, from outside the State into the market area for carrying out manufacturing. There is no sale within the market area so as to attract the market levy. xi. There is no sale within the market area so as to attract the market levy. xi. In order to deal with this contention, we must consider the case-law, which is cited before us. In the decision in the case of Belsund Sugar Co. Ltd. vs. State of Bihar & others (supra), which has been cited before us by the parties, the court dealt with various commodities. They included sugarcane. It also referred to the Constitution Bench decision of the Apex Court in the case of Kewal Krishan Puri & another vs. State of Punjab & another, reported in (1980) 1 SCC 416 . The court took the view that, though there was a market legislation, it could not cover the area, which is covered by the Sugarcane Act, as it was a special enactment. There was also the Sugar (Control) Order, 1966, which, read with the State Sugarcane Act, carved out the entire field covered by it to the extent that the market legislation conflicted with the provisions contained in the Sugarcane Act and the Order. Therefore, the court took the view that the market legislation must stand overwhelmed by the specific provisions relating to sugarcane contained in the law made by the State Legislation and also the law enacted by the Central Legislation and subordinate legislative bodies. It is, no doubt, true that in paragraphs 106 & 107 of the said judgment, the Apex Court, inter alia, held as follows: “106. In the case of Kewal Krishan Puri and Anr., vs. State of Punjab and Anr. etc. etc. ( 1980 (1) SCC 416 ), a Constitution Bench of this Court, while upholding the levy of market fee under the Punjab Agricultural Produce Markets Act, 1961, has made the following pertinent observations in paragraph 23 of the report. Untwalia J., speaking for the Court observed: “From a conspectus of the various authorities of this Court we deduce the following principles for satisfying the tests for a valid levy of market fees on the agricultural produce bought or sold by licensees in a notified market area : (1) That the amount of fee realised must be earmarked for rendering services to the licensees in the notified market area and a good and substantial portion of it must be shown to be expended for this purpose. (2) That the services rendered to the licensees must be in relation to the transaction of purchase or sale of the agricultural produce. (3) That while rendering services in the market area for the purposes of facilitating the transactions of purchase and sale with a view to achieve the objects of the marketing legislation it is not necessary to confer the whole of the benefit on the licensees but some special benefits must be conferred on them which have a direct, close and reasonable correlation between the licensees and the transactions. (4) That while conferring some special benefits on the licensees it is permissible to render such service in the market which may be in the general interest of all concerned with the transactions taking place in the market. (5) That spending the amount of market fees for the purpose of augmenting the agricultural produce, its facility of transport in villages and to provide other facilities meant mainly or exclusively for the benefit of the agriculturists is not permissible on the ground that such services in the long run go to increase the volume of transactions in the market ultimately benefiting the traders also. Such an indirect and remote benefit to the traders is in no sense a special benefit to them. (6) That the element of quid pro quo may not be possible, or even necessary, to be established with arithmetical exactitude but even broadly and reasonably it must be established by the authorities who charge the fees that the amount is being spent for rendering services to those on whom falls the burden of the fee. (7) At least a good and substantial portion of the amount collected on account of fees, may be in the neighbourhood of two-thirds or three-fourths, must be shown with reasonable certainty as being spent for rendering services of the kind mentioned above.” 107. (7) At least a good and substantial portion of the amount collected on account of fees, may be in the neighbourhood of two-thirds or three-fourths, must be shown with reasonable certainty as being spent for rendering services of the kind mentioned above.” 107. It becomes at once clear that before justifying levy of market fee on any transaction the services to be rendered by the market committee must be in connection with the sale and purchase transactions of agricultural produce falling for regulation under the Market Act, when the purchase and sale of agricultural produce like sugarcane, sugar or molasses are not governed by the Market Act, as we have seen while considering contention no.1, there would remain no occasion for the market committee to be statutorily under any obligation to provide any services or infrastructural facilities for covering such transactions so as to be entitled to charge market fee on such transactions. It was vehemently contended by learned senior counsel for the respondents that various types of infrastructural facilities are being made available to sugar factories who are purchasing sugarcane in the market area and selling manufactured sugar and molasses in the very same market area. The following are the various facilities and services highlighted in this connection: 1. Link road facilities by which market committees were to spend monies for connecting villages in the market area with the main roads for facilitating the movement of agricultural produce including the sugarcane from the farms to the purchase centres of the factories. 2. Spread of information regarding prices of agricultural produce for information of growers of sugarcane. 3. Providing mediation facility to enable the growers of sugarcane to get higher price for sugarcane as compared to the minimum prices fixed under the control orders. 4. Supervision of weighment of sugarcane. 5. Licensing of weighing inspectors. 6. Providing for drinking facility and park. 7. Parking facilities at the purchase centres. Shri Trivedi, Addl. Solicitor General, in his turn, tried to highlight the concept of link roads being other than approach roads. He submitted that near the factory gate or purchase centres provision of approach roads may be a statutory obligation of the sugar factories. Thus approach roads would connect the purchase centres with the nearby public roads. Shri Trivedi, Addl. Solicitor General, in his turn, tried to highlight the concept of link roads being other than approach roads. He submitted that near the factory gate or purchase centres provision of approach roads may be a statutory obligation of the sugar factories. Thus approach roads would connect the purchase centres with the nearby public roads. But so far as link roads are concerned, they are also public roads other than approach roads which connect villages with main roads and all these facilities make possible quicker movement of sugarcane from farms to the purchase centres. This results in supplying better quality of sugarcane for being crushed in the factories so that before such sugarcane dries out it gets crushed resulting in better quality and larger quantity of sugar for the benefit of sugar factories.” xii. At the same time, it is important to consider Section 27 of the market legislation involved therein. It reads as follows: “27. Power to levy fees - (1) The Market Committee shall levy and collect market fees on the agricultural produce bought or sold in the market area at the rate of rupee one per Rs.100 worth of agricultural produce. xxxxx xxxx xxxx (2) The market fee chargeable under sub-section (1) shall be payable by the buyer, in the manner prescribed. (3) The fee chargeable under sub-section (1) shall not be levied more than once on a notified agricultural produce in the same notified market area.” xiii. Therefore, that was a case, where the legislative provisions contemplated levy of market fee only on transaction of sale and purchase in the market area. Therefore, this also was a case, where the Court did not have occasion to consider the situation, where the legislative provisions provided for levy of market fee and development cess on merely bringing the agricultural produce into the market area for the purposes other than sale, which is the question involved in these cases. It is also, apparently, because of the same that the court proceeded to lay down, relying on the judgment of the Constitution Bench, as referred to in paragraph 106, namely, that the services rendered to the licensees must be in relation to transaction of purchase or sale of agricultural produce. Similarly explainable are the observations contained in paragraph 107, which we have adverted to. Similarly explainable are the observations contained in paragraph 107, which we have adverted to. We must also refer to paragraph 109 of the judgment, which is as follows: “109. The aforesaid contentions of learned senior counsel for the respondents for salvaging the situation for the market committees though appearing attractive at the first blush, do not survive on a closer scrutiny. The reason is obvious. Only because the sugarcane factories are located in the market area they can be said to be covered by the general sweep of Section 27 of the Market Act as the agricultural produce, namely, sugarcane as well as sugar and molasses can be said to be bought and sold in the market area. But by the fact only of sale and purchase of these commodities in the market area, it cannot be said that such agricultural produce belongs to the category of agricultural produce which is covered by the general sweep of the Act. In order to attract the charge under Section 27, the concerned agricultural produce on which the market fee is to be levied must be required to be bought and sold in the market area within the jurisdiction of the concerned market committee as per Section 15 of the Market Act which enjoins that no agricultural produce specified in the notification under sub-section (1) of Section 4 shall be bought or sold by any person within the market area other than the relevant principal market yard or sub-market yards. Thus, on a conjoint reading of Sections 27 and 15 of the Market Act, it must be held that before any charge of market fee can settle regarding any purchase and sale transactions concerning the agricultural produce, such agricultural produce must have been required to be sold or purchased at the relevant principal market yard or sub-market yards. It is obvious that principal market yard or submarket yards would be situated within the market area, but if any agricultural produce is exempted from the provisions of Section 15(1) of the Act as in the case of sugarcane, sugar and molasses there would remain no occasion for transactions of sale and purchase of these commodities to be carried on only in the principal market yard or sub-market yards and not elsewhere in any other part of market area. It is only those agricultural produce which are required to be bought and sold in the relevant principal market yard or sub-market yards situated within the market area that attract charge of Section 27 of the Act. Once this charge is attracted, the further question whether it is backed by any quid pro quo would survive for consideration. On the facts of the present case, Section 15 as a whole is out of picture for controlling purchase and sale of sugarcane, sugar and molasses by sugar factories operating in the market area, as we have seen earlier, the charge of market fee as envisaged by Section 27 would not get attracted at all for them. Hence the aforesaid list of the infrastructural facilities made available to sugar factories in general with other dealers in agricultural produce attracting Section 15 of the Act would pale into insignificance. Market Committees would not supply adequate quid pro quo for levying market fee as the charge itself does not settle on these transactions by the sugar factories. It may be, as submitted by learned senior counsel for the respondents, that some sugar factories may have taken benefit of electric lighting and preparation of approach roads by the market committees which might have spent sufficient funds for giving these facilities. Still they would not be a part and parcel of the statutory obligations of the market committees qua such sugar factories and may remain in the domain of Section 72 of the Indian Contract Act and if such benefits are received by the factories they may be liable on the principle of quantum meruit to reimburse or compensate the market committees for the voluntary facilities given by them but they would not support any legal quid pro quo by way of statutory obligation of the market committees for giving facilities to the sugar mills for supporting the levy of market fees on their transactions.” xiv. It is relevant to notice that, in the facts of the said case, in the first place, under Section 27 of the Act, market fee could be levied only on sale and purchase; secondly, in view of the exemption of the factories from the provisions of Section 15(1) of the Act, there was no occasion for transaction of sale and purchase of those commodities to be carried on only in the principal market yard or sub market yards. Therefore, this went to the very root of the charging provision, as the sale held outside the market yard and the sub market yards did not, obviously, attract the levy in terms of Section 27. Therefore, it was a question, which turned on the interplay of Section 27 and the exemption granted from Section 15 of the Act. It is, in the said context, apparently, that the court proceeded to hold, inter alia, that sugar factories, though may have taken the benefit of some facilities, they would not be a part of the statutory obligations qua the sugar factories and would remain in the domain of Section 72 of the Indian Contract Act and the matter may have to be decided on the principle of quantum meruit. xv. Viewed thus, this would, in our view, be sufficient to dispose of the argument based on absence of statutory duty to provide amenities or facilities qua manufacturers when, in Section 27 of the Act involved in these cases, there is express levy of market fee and development cess provided on agricultural produce brought for processing or manufacturing, inter alia. xvi. As far as the judgment of the Apex Court rendered in the case of ITC Ltd. vs. Agricultural Produce Market Committee & others (supra) is concerned, we are of the view that the said judgment cannot assist the appellants. This judgment is cited before us for the proposition that, by the impugned Legislation, the State Legislature has acted in excess of its legislative powers. The contention is that, since Entry 52 of List I deals with Industries, which are declared to be of importance by a law and since the Industries (Development and Regulation) Act, 1951, a law made by the Parliament and referable to Entry 52 of List I, has declared various Industries and they include the Industries, which are involved in these cases; it is incompetent on the part of the State Legislature to visit the Industries covered by Entry 52 of List I with levy of market fee and / or development cess, as provided. In the judgment in ITC Ltd. vs. Agricultural Produce Market Committee & others (supra), the Apex Court, by a majority, has taken the view that, what is covered by Entry 52 of List I, is the actual act of carrying out the manufacturing process involved in the said Industries. In the judgment in ITC Ltd. vs. Agricultural Produce Market Committee & others (supra), the Apex Court, by a majority, has taken the view that, what is covered by Entry 52 of List I, is the actual act of carrying out the manufacturing process involved in the said Industries. Anything prior to that would not be covered by Entry 52 of List I. This is clear from a perusal of the following conclusions of Justice Y.K. Sabharwal, as His Lordship then was, which are contained in paragraph 90: “90. In view of the aforesaid, I conclude as under: 1. The State legislations and the Tobacco Board Act, 1975 to the extent of sale of tobacco in market area cannot coexist. 2. The State Legislatures are competent to enact legislations providing for sale of agricultural produce of tobacco in market area and for levy and collection of market fee on that produce. 3. The Parliament is not competent to pass legislation in respect of goods enumerated in aforesaid conclusion No.2 while legislating in the field of legislation covered by Entry 52 of the Union List under which the Parliament can legislate only in respect of industries, namely, ‘the process of manufacture or production’ as held in Tika Ramji’s case. The activity regarding sale of raw tobacco as provided in the Tobacco Board Act cannot be regarded as ‘industry’. 4. ITC case (1985 Supp. SCC 476) is not correctly decided.” Justice Ruma Pal, who wrote a concurrent judgment, took the following view, inter alia: “98. The Bihar Agricultural Produce Markets Act, 1960 (referred to hereafter as “the Markets Act”) was enacted by the State of Bihar and is ostensibly referable to Entry 28 of List II which gives the State Legislature the exclusive power to legislate on “Markets and Fairs” read with Entry 66 of List II according to which the State Legislature may also levy fees in respect of any matter in List II except Court fees. It is true that in Belsund Sugar Company vs. State of Bihar the Court proceeded on the basis that the Markets Act had been enacted by the Bihar Legislature not only under the legislative power vested in it by Entry 28 but also under Entries 26 and 27 of List II of the Seventh Schedule of the Constitution but in that case, there does not appear to have been any controversy raised on this point. Entries 26 and 27 of List II read as under: 26. Trade and commerce within the State subject to the provisions of Entry 33 of List III. 27. Production, supply and distribution of goods subject to the provisions of Entry 33 of List III.’ 99. It has also been argued by the respondents that the State Act is also referable to Entry 14 of List II which describes the permissible subject matter of legislation by States as: 14. Agriculture, including agricultural education and research, protection against pests and prevention of plant diseases’. 100. Except for Entries 26 and 27 of List II, each of the other entries comes within the exclusive legislative domain of the States. 111. The seminal decision on this process of interpretation for arriving at the definition of ’industry’ is Ch. Tika Ramji & Others V. State of Uttar Pradesh & Ors. in which a Constitution Bench unanimously held: ‘Industry in the wide sense of the term would be capable of comprising three different aspects: (1) raw materials which are an integral part of the industrial process, (2) the process of manufacture or production, and (3) the distribution of the products of the industry. The raw materials would be goods which would be comprised in Entry 26 of List II. The process of manufacture or production would be comprised in Entry 24 of List II except where the industry was a controlled industry when it would fall within Entry 52 of List I and the products of the industry would also be comprised in Entry 27 of List II except where they were the products of the controlled industries when they would fall within Entry 33 of List III.’ 119. It is unnecessary to multiply instances of the numerous decisions which have followed the logic of Tika Ramji and accepted its conclusion that for the purposes of Entry 24 of List II and consequently Entry 52 of List I, ’industry’ means "manufacture or production" and nothing more. It is sufficient to note that Tika Ramji’s definition of industry has been affirmed and applied recently by a Constitution Bench in Belsund Sugar Company v. State of Bihar (supra) and is still good law. Harak Chand Banthia’s case does not strike a discordant note. 127. Applying the negative test as evolved in Tika Ramji in this case it would follow that the word ’industry’ in Entry 24 of List II and consequently Entry 52 of List I does not and cannot be read to include Entries 28 and 66 of List II which have been expressly marked out as fields within the State’s exclusive legislative powers. As noted earlier Entry 28 deals with markets and fairs and Entry 66 with the right to levy fees in respect of, in the present context, markets and fairs. Entry 52 of List I does not override Entry 28 in List II nor has Entry 28 in List II been made subject to Entry 52 unlike Entry 24 of List II. This Court in Belsund Sugar (supra) has also accepted the argument that Entry 28 of List II operated in its own and cannot be affected by any legislation pertaining to industry as found in Entry 52 of List I. xvii. We may also notice the majority judgment of a Constitution Bench in the case of State of West Bengal vs. Kesoram Industries Ltd. & others, reported in (2004) 10 SCC 201 . Therein, the court, inter alia, held as follows: “146. As stated earlier also, the impugned cess can be justified as fee as well. The term cess is commonly employed to connote a tax with a purpose or a tax allocated to a particular thing. However, it also means an assessment or levy. Depending on the context and purpose of levy, cess may not be a tax; it may be a fee or fee as well. It is not necessary that the services rendered from out of the fee collected should be directly in proportion with the amount of fee collected. However, it also means an assessment or levy. Depending on the context and purpose of levy, cess may not be a tax; it may be a fee or fee as well. It is not necessary that the services rendered from out of the fee collected should be directly in proportion with the amount of fee collected. It is equally not necessary that the services rendered by the fee collected should remain confined to the persons from whom the fee has been collected. Availability of indirect benefit and a general nexus between the persons bearing the burden of levy of fee and the services rendered out of the fee collected is enough to uphold the validity of the fee charged. The levy of the impugned cess can equally be upheld by reference to Entry 66 read with Entry 5 of List II.” Therefore, the availability of indirect benefit also would suffice. xviii. In the case of State of H.P. & others vs. Shivalik Agro Poly Products & others, reported in (2004) 8 SCC 556 , a Bench of three Judges made a review of the earlier case-law and referred to the three-Judge Bench in Sreenivasa General Traders vs. State of A.P., reported in (1983) 4 SCC 353 , and also referred, inter alia, to Krishi Upaj Mandi Samiti vs. Orient Paper and Industries Ltd., reported in (1995) 1 SCC 655 . Therein, the court took the view, inter alia, that all that is necessary is that there should be a reasonable relationship between the levy of fee and the services rendered. xix. If that be so, we are at a loss to understand how levying market fee and / or cess on the transaction of bringing the agricultural produce into the market area for the purpose of manufacture would constitute an impingement on the legislative province exclusively earmarked for the Central Legislature, as contended by the appellants. The transaction of bringing the agricultural produce, be it for the purpose of manufacture inter alia, is what attracts the levy of market fee / cess. We would think that this is a separable transaction, which is well within the province of the State Legislature and the powers available to it in Entry 28, read with Entry 66, of List II. Entry 28 of List II provides for “markets”. The Entries are fields of legislation. We would think that this is a separable transaction, which is well within the province of the State Legislature and the powers available to it in Entry 28, read with Entry 66, of List II. Entry 28 of List II provides for “markets”. The Entries are fields of legislation. It is elementary that widest and most liberal interpretation must be placed on the Entries. An interpretation may not be placed, which will deprive the competent Legislature of the full legislative powers it enjoys. In fact, the very principle of Federalism in India or, rather, principle of quasi-federal structure, we have in India, is premised largely upon the State Legislatures being absolutely sovereign in regard to the subject matters, which are earmarked to it. In the market, may be, what is intended to be regulated is sale and purchase; but, as already noted, the markets are to be developed and regulated. The Constitution does not prohibit levy of fee on either sale of agricultural produce or even, without a sale, bringing in any agricultural produce in the market area, be it for processing or manufacturing. It is for the Legislature to choose the transactions, which take place within the market area and, if, in its wisdom, it has chosen to visit a transaction involving bringing of the agricultural produce and the use of the same by a manufacturing unit, which is located within the market area, for the levy of market fee and / or development cess; we would think that there would be no legislative excess involved. xx. There is a case for the appellants that the words “processing” and “storing”, which also attract market fee and development cess, can be understood as only meaning that if it is done in connection with or incidental to sale and purchase being effected in the market area. In other words, if agricultural produce is stored or processed for the purpose of sale or purchase, then alone, there can be a valid levy of market fee and / or cess. We are afraid, this contention does not have merit. The levy is on the act of storing or processing of agricultural produce in the market area. The goods, which are processed after the processing takes place, may or may not be sold in the market. We are afraid, this contention does not have merit. The levy is on the act of storing or processing of agricultural produce in the market area. The goods, which are processed after the processing takes place, may or may not be sold in the market. The goods, if processed and if sold in the market area, may undoubtedly attract levy of market fee and / or cess. Likewise, if the processed goods, instead of they being sold, are dispatched outside the market area, they may not attract the levy. If that be the position, the levy of market fee and / or cess on the agricultural produce, which is processed, would be defeated. If what is produced by processing attracts levy on sale within the market area, it may be a case of a different agricultural produce being sold in the market area, which, independently, attracts the levy. That will not, however, detract from the independent levy on agricultural produce brought for processing. The requirement would only be that the purpose, for which the agricultural produce is brought, namely, processing must be fulfilled. As we have already noted, if the processed product is not sold within the market area, it cannot be said that the levy on the agricultural produce, which is processed, is not to be fulfilled. xxi. In the same way, as far as storage is concerned, when agricultural produce is stored in the market area that suffices to attract the levy of market fee and / or cess. When storing is done, the person, who stored it, would obviously also derive benefit from the facilities, which are made available and, therefore, it is clear that it is not necessary that the storage must be followed by sale within the market area to attract the levy of market fee and / or cess. xxii. We are, therefore, of the view that the State Legislature is, indeed, armed with the power to legislate, as is done in the impugned provisions. 39. Whether there is violation of Articles 14 & 19 of the Constitution? i. The argument appears to be that the impugned provisions are arbitrary and the levy of market fee and development cess, particularly in the rates, on transactions also amounts to violation of Article 19(1)(g) of the Constitution guaranteeing freedom to carry on trade, occupation or business. ii. 39. Whether there is violation of Articles 14 & 19 of the Constitution? i. The argument appears to be that the impugned provisions are arbitrary and the levy of market fee and development cess, particularly in the rates, on transactions also amounts to violation of Article 19(1)(g) of the Constitution guaranteeing freedom to carry on trade, occupation or business. ii. We are of the view that there is no merit in the aforesaid argument. It is to be noted that, by virtue of the amended provisions, actually, the development cess, alone, is payable in vast majority of the cases before us. In other words, when market fee and development cess has been levied outside the State of Uttarakhand and the produce is brought into the market area in Uttarakhand for the purpose of manufacture or processing, then, only development cess at ½ per cent is leviable. We would not think that it could be said that there is any violation, in the circumstances of the case, on the basis of violation of Article 14 or Article 19. 40. Whether there is violation of Article 301 of the Constitution? i. Article 301 of the Constitution of India declares as follows: “301. Freedom of trade, commerce and intercourse.- Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free.” ii. This is followed by Article 302, which provides Parliament with the power, by legislation, to impose reasonable restrictions. Article 304(a) provides for the power with the State Legislature to impose a non-discriminatory tax. Article 304(b) provides for imposing reasonable restrictions by way of law, provided that the assent of the President is obtained for such a Legislation. There is no attempt to justify the market fee / development cess on the basis of it being a reasonable restriction within the meaning of Article 304(b). In fact, there is no assent of the President, as pointed out by the learned counsel for the appellants, and there can be no occasion for the State to invoke the protection of Article 304(b). Apparently, the contention is that it does not attract Article 301. It is, therefore, necessary for us to examine what Article 301 provides for. Article 301, as we have noted, declares that trade, commerce and intercourse throughout the Nation will be free. This provision, apparently, is taken from Section 92 of the Australian Constitution. Apparently, the contention is that it does not attract Article 301. It is, therefore, necessary for us to examine what Article 301 provides for. Article 301, as we have noted, declares that trade, commerce and intercourse throughout the Nation will be free. This provision, apparently, is taken from Section 92 of the Australian Constitution. The commerce clause in the American Constitution was borne in mind by the founding fathers. The scope of Article 301 was considered by a Constitution Bench of the Apex Court in the case of Atiabari Tea Co. Ltd. vs. State of Assam and others, reported in AIR 1961 SC 232 . Therein, the Court took the view that the freedom is not an absolute freedom. Unless there is a law, which directly impinges on the free flow of goods, inter alia, through the territory of India, there could be occasioned no breach of Article 301. That is a case, which involved the validity of the Assam Legislation, which provided for taxes on goods, which were transported by road. It is important to notice, however, that the correctness of the said judgment came to be considered by the Apex Court in the decision in Automobile Transport (Rajasthan) Ltd. vs. State of Rajasthan & others, reported in AIR 1962 SC 1406 . The Apex Court, through the majority, considered the matter exhaustively and, while rejecting the two extreme views, took the view that the freedom declared in Article 301 is not an absolute freedom and it can be regulated by the State by way of regulatory measures and also the imposition of compensatory taxes. It is significant to notice in this context, in the majority judgment, in rejecting the widest view, the Apex Court, inter alia, held as follows: “Under some of these entries the State Legislature may impose different kinds of taxes and duties, such as property tax, profession tax, sales tax, excise duty, etc., and legislation in respect of any one of these items may have an indirect effect on trade and commerce. Even laws other than taxation laws, made under different entries in the lists referred to above, may indirectly or remotely affect trade and commerce. Even laws other than taxation laws, made under different entries in the lists referred to above, may indirectly or remotely affect trade and commerce. If it be held that every law made by the Legislature of a State which has a repercussion on tariffs, licensing marketing regulations, price-control etc., must have the previous sanction of the President, then the Constitution in so far as it gives plenary power to the States and State Legislatures in the fields allocated to them would be meaningless. In our view the concept of freedom of trade, commerce and intercourse postulated by Art. 301 must be understood in the context of an orderly society and as part of a Constitution which envisages a distribution of powers between the States and the Union, and if so understood, the concept must recognize the need and legitimacy of some degree of regulatory control, whether by the Union or the States: this is irrespective of the restrictions imposed by the other articles in Part XIII of the Constitution. We are, therefore, unable to accept the widest view as the correct interpretation of the relevant articles in Part XIII of the Constitution.” iii. The theory of compensatory taxes was, in fact, judicially evolved by the Supreme Court in the case of Automobile Transport (Rajasthan) Ltd. vs. State of Rajasthan & others (supra). The concept of compensatory tax is that it is a tax, which is levied for a particular service, which is provided. Suffice it to say, the question as to whether, for the application of the doctrine of compensatory tax, some service is sufficient or there must be equivalence has been finally settled by the Constitution Bench of the Apex Court in the decision in Jindal Stainless Ltd. (2) & another vs. State of Haryana & others, reported in (2006) 7 SCC 241 , wherein the view expressed by some earlier decisions of the Apex Court that it is sufficient that some service, alone, will suffice to sustain a compensatory tax was held to be bad law. iv. In this case, therefore, appellants would, in fact, contend that the levy cannot be justified as a compensatory tax. But, here, the respondents are not justifying the same as a compensatory tax. On the other hand, they are justifying the same as being fees and cess. iv. In this case, therefore, appellants would, in fact, contend that the levy cannot be justified as a compensatory tax. But, here, the respondents are not justifying the same as a compensatory tax. On the other hand, they are justifying the same as being fees and cess. In this context, it is necessary for us to consider as to what is a “fee” and what is the distinction between a “tax” and a “fee” and, further, what is the import of the word “cess”. Generically, a “fee” is a compulsory imposition, just like a “tax”. A “tax” is a compulsory exaction of money for public purposes. The amount collected by way of tax goes into the public coffers without being earmarked for any particular purpose. A “fee”, on the other hand, though is a compulsory exaction, is one which is collected in lieu of some service, which is provided. Though in the case of The Commissioner, Hindu Religious Endowments, Madras vs. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt, reported in AIR 1954 SC 282 , the concept of quid pro quo was laid down, it is clear that, over the years, the courts have relaxed the concept of quid pro quo to the extent that, today, we would only rely on the following judgments of the Apex Court for the elements, which go to sustain the levy of fees: a. In the case of Municipal Corporation of Delhi & others vs. Mohd. Yasin, reported in AIR 1983 SC 617 , which was a case under the Delhi Municipal Corporation Act and which related to a fee for slaughtering animals in slaughter houses; the Apex Court, after referring to the case-law, which included Hingir-Rampur Coal Co. Ltd. vs. State of Orissa reported in AIR 1961 SC 459 among others, held as follows: “9. What do we learned from these precedents? We learn that is no generic difference between a tax and a fee, though broadly a tax is a compulsory exaction as part of a common burden, without promise of any special advantages to classes of taxpayers whereas a fee is a payment for services rendered, benefit provided or privilege conferred. Compulsion is not the hall-mark of the distinction between a tax and a fee. Compulsion is not the hall-mark of the distinction between a tax and a fee. That the money collected does not go into a separate fund but goes into the consolidated fund does not also necessarily make a levy a tax. Though a fee must have relation to the services rendered, or the advantages conferred, such relation need not be direct, a mere causal relation may be enough. Further, neither the incidence of the fee nor the service rendered need be uniform. That others besides those paying the fees are also benefited does not detract from the character of the fee. In fact the special benefit or advantage to the payers of the fees may even be secondary as compared with the primary motive of regulation in the public interest. Nor is the Court to assume the role of a cost accountant. It is neither necessary nor expedient to weigh too meticulously the cost of the services rendered etc. against the amount of fees collected so as to evenly balance the two. A broad correlation-ship is all that is necessary. Quid pro quo in the strict sense is not the one and only true index of a fee; nor is it necessarily absent in a tax.” b. In the case of The City Corporation of Calicut vs. Thachambalath Sadasivan & others, reported in AIR 1985 SC 756 , no doubt the matter related to levy of licence fee for the use of premises and land for soaking coconut husk. The court, inter alia, held as follows: “It is well-settled by numerous recent decisions of the Supreme Court that the traditional concept in a fee of quid pro quo is undergoing a transformation and that though the fee must have relation to the services rendered, or the advantages conferred, such relation need not be direct, a mere casual relation may be enough. It is not necessary to establish that those who pay the fee must receive direct benefit of the services rendered for which the fee is being paid. If one who is liable to pay receives general benefit from the authority levying the fee, the element of service required for collecting fee is satisfied. It is not necessary to establish that those who pay the fee must receive direct benefit of the services rendered for which the fee is being paid. If one who is liable to pay receives general benefit from the authority levying the fee, the element of service required for collecting fee is satisfied. It is not necessary that the person liable to pay must receive some special benefit or advantage for payment of the fee.” c. In P.M. Ashwathanarayana Setty & others vs. State of Karnataka & others, reported in AIR 1989 SC 100 , the court was dealing with a case under the Rajasthan Court-Fees and Suits Valuation Act. The court, inter alia, held that the co-relation between the amount raised through the fee and the expenses involved in providing the services need not be examined with a view to ascertaining any accurate, arithmetical equivalence or precision in the co-relation; but it will be sufficient that there is a broad and general co-relation. But a fee loses its character as such if it is intended to and does go to enrich the general revenues of the State to be applied for general purposes of Government. The court also held that the concept of fee is not satisfied merely by showing that the class of persons from whom the fee is collected also derives some benefit from those activities of Government. It was further held as follows: “Nor does the concept of a fee and this is important-require for its substance the requirement that every member of the class on whom the fee is imposed, must receive a corresponding benefit or degree of benefit commensurate with or proportionate to the payment that he individually makes.” d. It is important to notice the judgment of a Bench of two Judges of the Apex Court in the case of Vijayalashmi Rice Mill & others vs. Commercial Tax Officers, Palakol & others, reported in (2006) 6 SCC 763 . That is a case, where the appellants were engaged in the business of rice milling. They paid tax on purchase of Paddy and sale of rice. They challenged the constitutionality of the A.P. Rural Development Act, 1996, under which, cess at a certain rate on purchase of goods, in addition to purchase tax and sales tax, was levied. They were unsuccessful. They paid tax on purchase of Paddy and sale of rice. They challenged the constitutionality of the A.P. Rural Development Act, 1996, under which, cess at a certain rate on purchase of goods, in addition to purchase tax and sales tax, was levied. They were unsuccessful. One of the contentions taken was that the levy of the cess was unconstitutional as the Legislature could not, in the exercise of its power under Entry 54 of List II, which related to the tax on sale and purchase of goods as provided therein, levy the impugned cess. The contention of the respondent, on the other hand, was that the cess in question was, in fact, a fee and, therefore, it came under Entry 66 of List II. Appellants contended that there was no quid pro quo and, therefore, it could not be treated as a fee. Rejecting the contentions of the appellants, the Apex Court, inter alia, held as follows: “12. Ordinarily, a cess means a tax which raises revenue, which is applied to a specific purpose. Thus in Guruswamy and Co. v. State of Mysore, (1967) 1 SCR 548 Hidayatullah, J. in his dissenting judgment observed : (SCR p. 571 D-E) “The word `cess' is used in Ireland and is still in use in India although the word rate has replaced it in England. It means a tax and is generally used when the levy is for some special administrative expense which the name (health cess, education cess, road cess, etc.) indicates. When levied as an increment to an existing tax, the name matters not for the validity of the cess must be judged of in the same way as the validity of the tax to which it is an increment.” (emphasis supplied) The aforesaid observations have been referred to by the Constitution Bench decision of this Court in India Cement Ltd. & Ors. v. State of T.N.(1990) 1SCC 12 vide para 19. 13. Hence ordinarily a cess is also a tax, but is a special kind of a tax. Generally tax raises revenue which can be used generally for any purpose by the State. v. State of T.N.(1990) 1SCC 12 vide para 19. 13. Hence ordinarily a cess is also a tax, but is a special kind of a tax. Generally tax raises revenue which can be used generally for any purpose by the State. For instance, the income tax or excise tax or sales tax are taxes which generate revenue which can be utilized by the Union or the State Governments for any purpose, e.g. for payment of salary to the members of the armed forces or civil servants, police, etc. or for development programmes, etc. However, cess is a tax which generates revenue which is utilized for a specific purpose. For instance, health cess raises revenue which is utilized for health purposes e.g. building hospitals, giving medicines to the poor etc. Similarly, education cess raises revenue which is used for building schools or other educational purposes. 14. However, in such matters nomenclature is not very important and we have to see the nature of the levy. Hence, what is called a cess may be in reality a fee depending on its nature. 15. It is well settled that the basic difference between a tax and a fee is that a tax is a compulsory exaction of money by the State or a public authority for public purposes, and is not a payment for some specific services rendered. On the other hand, a fee is generally defined to be a charge for a special service rendered by some governmental agency. In other words there has to be quid pro quo in a fee vide Kewal Krishan Puri v. State of Punjab, AIR (1980) 1 SCC 416 . 22. In Sona Chandi Oal Committee v. State of Maharashtra, (2005) 2 SCC 345 , this Court observed as under: (SCC pp.354-55, para 22) “[The traditional concept of quid pro quo in a fee has undergone considerable transformation. So far as the regulatory fee is concerned, the service to be rendered is not a condition precedent and the same does not lose the character of a fee provided the fee so charged is not excessive. It was not necessary that service to be rendered by the collecting authority should be confined to the contributories alone. So far as the regulatory fee is concerned, the service to be rendered is not a condition precedent and the same does not lose the character of a fee provided the fee so charged is not excessive. It was not necessary that service to be rendered by the collecting authority should be confined to the contributories alone. The levy does not cease to be a fee merely because there is an element of compulsion or coerciveness present in it, nor is it a postulate of a fee that it must have a direct relation to the actual service rendered by the authority to each individual who obtains the benefit of the service. Quid pro quo in the strict sense was not always a sine qua non for a fee. All that is necessary is that there should be a reasonable relationship between the levy of fee and the services rendered. …[and it is] not necessary to establish that those who pay the fee must receive direct or special benefit or advantage of the services rendered for which the fee was being paid. It was held that if one who is liable to pay, receives general benefit from the authority levying the fee, the element of service required for collecting the fee is satisfied.” 23. In State of W.B. v. Kesoram Industries Ltd. (2004) 10 SCC 201 a Constitution Bench of the Supreme Court (vide SCC p.330, para 140) observed: “The imposition of cess envisaged through the SADA Act and the Rules was a step towards developing the special area. It is a matter of common knowledge, and does not need any evidence to demonstrate, that mining activity carried on on the land within the special area involves extraction, removal, loading-unloading and transportation of the minerals accompanied by its natural consequences entailed on the environment and the infrastructure such as roads, water and power supply etc. within the special area. The impugned cess can, therefore, be justified as a fee for rendering such services as would improve the infrastructure and general development of the area, the benefits whereof would be availed even by the stone-crushers. Entry 66 in List II is available to provide protective constitutional coverage to the impugned levy as fee.” 25. within the special area. The impugned cess can, therefore, be justified as a fee for rendering such services as would improve the infrastructure and general development of the area, the benefits whereof would be availed even by the stone-crushers. Entry 66 in List II is available to provide protective constitutional coverage to the impugned levy as fee.” 25. Learned counsel for the appellant has relied on the Constitution Bench decision of this Court in Jindal Stainless Ltd. & Anr., v. State of Haryana and Ors., (2006) 7 SCC 241 and he relied on para 39 of the said judgment which refers to "the principle of equivalence". In our opinion the aforesaid decision cannot be interpreted to mean that the sea change which has taken place in the concept of fee (as noted above) has vanished, and that by this decision the old concept of fee has been restored, and that now it has to be established that the particular individual from whom the fee is being realized must be rendered some specific services. 26. It may be noted that the decision in Jindal Stainless (supra) was given in connection with Article 301 of the Constitution, and it was not regarding the nature of a fee. Hence, it cannot be regarded as an authority explaining the nature of a fee. In our opinion the decisions of this Court in Sreenivasa General Traders v. State of A.P. (1983) 4 SCC 353 , City Corpn. of Calicut v. Thachambalath (1985) 2 SCC 112 , State of H.P. v. M/s Shivalik Agro Poly Products (2004) 8 SCC 556 , etc. still hold the field regarding the nature of a fee.” It is also important to notice paragraphs 19 & 20 of the said judgment, which are as follows: “19. In the present case, there is no averment by the petitioner in the writ petition that there is no broad correlation between the amount realized as a cess and the amounts spent for the purposes mentioned in Section 9 of the Act, namely, to provide and accelerate rural development including the construction of rural roads and bridges and storage facilities for storing agricultural produce and for maintaining and strengthening of the public distribution system. All that has been alleged by the petitioner in para 5 of the affidavit to the writ petition is that no specific benefit is given to the dealer from whom the cess is collected. 20. Thus the factual averment in the writ petition is limited to the plea that there is no specific service rendered to a particular dealer from whom the fee is realized. There is no factual averment that there is no broad correlation between the total amount of cess realized and the total value of the service being rendered to the people living in the rural areas.” The aforesaid statements, as contained in paragraphs 19 & 20, would, in our view, suffice to dispose of the argument of the appellants in these cases that there is no quid pro quo as no specific service is rendered to them. e. Now, we shall take the pleadings in Writ Petition (M/S) No. 523 of 2013, in which Mr. Rahul Sripat, Advocate, appears. He drew our attention to paragraph 34 of the writ petition, which, inter alia, contains the following pleading: “Now without providing any service for the manufacture of cotton yarn and having no role to play in its manufacturing, merely to charge market fee and development cess from the factories like that of petitioner, the impugned amendment has been incorporated without any object and reasons.” f. We notice that it is similar to the fact situation referred to in the case of Vijayalashmi Rice Mill & others vs. Commercial Tax Officers, Palakol & others (supra), where no service is being provided, which we have already adverted to. No doubt, as far as the allegation in para 34 of the writ petition is concerned, in the counter affidavit, the answer is that the contentions raised in paragraph 34 are not admitted and it was denied that the petitioner is not liable to pay any Mandi fee and development cess. We, however, notice the following averments in paragraph 9 of the counter affidavit filed on behalf of respondent Nos. 2 to 4 (at page 155 of the paper-book): “9. That the contents of Para 9 of the writ petition are not admitted and denied. It is submitted that the provisions of Section 2(xxix) are general in nature and it is not necessary for the Mandi Samiti to provide facility and to render services to each and every individual. 2 to 4 (at page 155 of the paper-book): “9. That the contents of Para 9 of the writ petition are not admitted and denied. It is submitted that the provisions of Section 2(xxix) are general in nature and it is not necessary for the Mandi Samiti to provide facility and to render services to each and every individual. The Mandi Samiti is expensing huge amount in development of markets, constructions of Link Roads, Pathways Jeepable Roads, Mule path, Pulia Water tanks hand pumps for drinking Water in market area, development of hats, constructions of shops shelter houses parking places accommodation for storage and providing facilities to the producers and commissions agents in the market area.” g. The allegation in paragraph 9 of the writ petition, incidentally, is as follows: “9. The definition of Market Charges under Section 2(xxix) is founded on the principle of equivalence and quid-pro-quo making sure that the charges recovered would have nexus with the facility provided inter-alia in the form of commission, brokerage, weighing, measuring, hammali (loading, unloading and carrying) cleaning, drying, sieving, stitching, stacking, hiring, filling up of gunny bags, stamping, bagging, storing, warehousing, grading, surveying, transporting and processing.” h. Even in Writ Petition (M/S) No. 665 of 2012, in which Mr. Ramesh Singh, Advocate, made his contentions, we notice that the allegation is that such element of quid pro quo, as is referred to in Ground D, is completely missing in the present case, as respondent No. 2 has rendered no service in the notified area for the purpose of or in connection with manufacturing. i. We would, therefore, reject the contention of the appellants based on total lack of quid pro quo or total absence of any benefit at all to the appellants. j. In the case of Consumer Online Foundation & others vs. Union of India & others, reported in (2011) 5 SCC 360 , the court was considering the question of the power of lessees of the Airports Authority of India to levy and collect development fee from embarking passengers at Delhi and Mumbai International Airports. The court took the view that the High Court’s conclusion that the lessees had power was contrary to the legislative intent of the amending Act of 2003. The court took the view that the High Court’s conclusion that the lessees had power was contrary to the legislative intent of the amending Act of 2003. The court relied on the judgment in the case of Vijayalashmi Rice Mill & others vs. Commercial Tax Officers, Palakol & others (supra) for the proposition that cess is a tax, which generates revenue, which is utilized for a special purpose, and that a levy under Section 22-A of the Act in question, though described as fee, is really in the nature of a cess or tax for generating revenue. The court further referred to Article 265 to hold that, once it is found to be a cess or a tax for a specific purpose, Article 265 stood attracted. k. In the case of Delhi Race Club Limited vs. Union of India & others, reported in (2012) 8 SCC 680 , a Bench of two Judges of the Apex Court was concerned with the validity of the Delhi Race Course Licensing (Amendment) Rules, 2001. The contentions raised were whether a licence fee charged was not in the nature of a fee but a tax having regard to the absence of the element of quid pro quo and whether the tenfold increase in the licence fee was highly excessive. The High Court answered the two questions raised as to whether it is a fee and, if fee, whether it is excessive, against the appellant. After an exhaustive review of the earlier case-law, the court, inter alia, held as follows: “31. Therefore, the pivotal question to be determined is the nature of the impost in the present case. The characteristics of a fee, as distinct from tax, were explained by this Court, as early as in The Commissioner, Hindu Religious Endowments, Madras Vs. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (commonly referred to as the ‘Shirur Mutt’s Case’). The ratio of this decision has been consistently followed as locus classicus in subsequent decisions dealing with the concept of ‘fee’ and ‘tax’. 32. A Constitution Bench of this Court in Hingir Rampur Coal Co. Ltd. Vs. State of Orissa12 was faced with the challenge of deciding upon the constitutional validity of the Orissa Mining Areas Development Fund Act, 1952, levying cess on the colliery of the petitioner therein. The Bench explained different features of a ‘tax’, a ‘fee’ and ‘cess’ in the following passage: “9. Ltd. Vs. State of Orissa12 was faced with the challenge of deciding upon the constitutional validity of the Orissa Mining Areas Development Fund Act, 1952, levying cess on the colliery of the petitioner therein. The Bench explained different features of a ‘tax’, a ‘fee’ and ‘cess’ in the following passage: “9. … The neat and terse definition of Tax which has been given by Latham, C.J., in Matthews v. Chicory Marketing Board (1938) 60 C.L.R. 263 is often cited as a classic on this subject. “A tax", said Latham, C.J., "is a compulsory exaction of money by public authority for public purposes enforceable by law, and is not payment for services rendered". In bringing out the essential features of a tax this definition also assists in distinguishing a tax from a fee. It is true that between a tax and a fee there is no generic difference. Both are compulsory exactions of money by public authorities; but whereas a tax is imposed for public purposes and is not, and need not, be supported by any consideration of service rendered in return, a fee is levied essentially for services rendered and as such there is an element of quid pro quo between the person who pays the fee and the public authority which imposes it. If specific services are rendered to a specific area or to a specific class of persons or trade or business in any local area, and as a condition precedent for the said services or in return for them cess is levied against the said area or the said class of persons or trade or business the cess is distinguishable from a tax and is described as a fee..” 33. It was further held that: (Hingir-Rampur case, AIR pp. 465-66, para 14) “14. … It is true that when the Legislature levies a fee for rendering specific services to a specified area or to a specified class of persons or trade or business, in the last analysis such services may indirectly form part of services to the public in general. If the special service rendered is distinctly and primarily meant for the benefit of a specified class or area the fact that in benefiting the specified class or area the State as a whole may ultimately and indirectly be benefited would not detract from the character of the levy as a fee. If the special service rendered is distinctly and primarily meant for the benefit of a specified class or area the fact that in benefiting the specified class or area the State as a whole may ultimately and indirectly be benefited would not detract from the character of the levy as a fee. Where, however, the specific service is indistinguishable from public service, and in essence is directly a part of it, different considerations may arise. In such a case it is necessary to enquire what is the primary object of the levy and the essential purpose which it is intended to achieve. Its primary object and the essential purpose must be distinguished from its ultimate or incidental results or consequences. That is the true test in determining the character of the levy.” (Emphasis supplied by us) 34. Recently in State of W.B. Vs. Kesoram Industries Ltd. & Ors.13, a Constitution Bench of this Court, relying upon the decision in Hingir Rampur Coal Co. Ltd (supra), explained the distinction between the terms ‘tax’ and ‘fee’ in the following words: (Kesoram Industries case, SCC p. 332, para 146) “146. … The term cess is commonly employed to connote a tax with a purpose or a tax allocated to a particular thing. However, it also means an assessment or levy. Depending on the context and purpose of levy, cess may not be a tax; it may be a fee or fee as well. It is not necessary that the services rendered from out of the fee collected should be directly in proportion with the amount of fee collected. It is equally not necessary that the services rendered by the fee collected should remain confined to the persons from whom the fee has been collected. Availability of indirect benefit and a genera l nexus between the persons bearing the burden of levy of fee and the services rendered out of the fee collected is enough to uphold the validity of the fee charged.” (Emphasis supplied by us) 35. In the light of the tests laid down in Hingir Rampur (supra) and followed in Kesoram Industries (supra), it is manifest that the true test to determine the character of a levy, delineating ‘tax’ from ‘fee’ is the primary object of the levy and the essential purpose intended to be achieved. In the light of the tests laid down in Hingir Rampur (supra) and followed in Kesoram Industries (supra), it is manifest that the true test to determine the character of a levy, delineating ‘tax’ from ‘fee’ is the primary object of the levy and the essential purpose intended to be achieved. In the instant case, it is plain from the scheme of the Act that its sole aim is regulation, control and management of horse-racing. Such a regulation is necessary in public interest to control the act of betting and wagering as well as to promote the sport in the Indian context. To achieve this purpose, licences are issued subject to compliance with the conditions laid down therein, which inter alia include maintenance of accounts and furnishing of periodical returns; amount of stakes which may be allotted for different kinds of horses; the measures to be taken for the training of the persons to become jockeys, to encourage Indian bred horses and Indian jockeys; the inclusion and association of such persons as the government may nominate as stewards or members in the conduct and management of the horse-racing. Therefore, by applying the principles laid down in the aforesaid decisions, it is clear that the said levy is a ‘fee’ and not ‘tax’. 37. It is pertinent to note that in Liberty Cinema (supra), the Court had identified the existence of two distinct kinds of fee and traced its presence to the Constitution itself. It was observed that in our Constitution, fee for licence and fee for services rendered are contemplated as different kinds of levy. The former is not intended to be a fee for services rendered. This is apparent from a bare reading of Articles 110(2) and 199(2) of the Constitution, where both the expressions are used, indicating thereby that they are not the same. Quoting Shannon Vs. Lower Mainland Dairy Products Board15, with approval, it was observed thus:- “8. … ‘… if licences are granted, it appears to be no objection that fees should be charged in order either to defray the costs of administering the local regulation or to increase the general funds of the Province or for both purposes…It cannot, as their Lordships think, be an objection to a licence plus a fee that it is directed both to the regulation of trade and to the provision of revenue.” 38. The same principle was reiterated in Secunderabad Hyderabad Hotels Owners’ Association case (supra) where the existence of two types of fee and the distinction between them has been highlighted as follows: “9. It is, by now, well settled that a licence fee may be either regulatory or compensatory. When a fee is charged for rendering specific services, a certain element of quid pro quo must be there between the service rendered and the fee charged so that the licence fee is commensurate with the cost of rendering the service although exact arithmetical equivalence is not expected. However, this is not the only kind of fee which can be charged. Licence fee can also be regulatory when the activities for which a licence is given require to be regulated or controlled. The fee which is charged for regulation for such activity would be validly classifiable as a fee and not a tax although no service is rendered. An element of quid pro quo for the levy of such fees is not required although such fees cannot be excessive.” (Emphasis supplied by us) 39. Dealing with such regulatory fees, this Court in Vam Organic Chemicals Ltd. & Anr. Vs. State of U.P. & Ors.; observed that in case of a regulatory fee, like the licence fee, no quid pro quo is necessary, but such fee should not be excessive. The same distinction between regulatory and compensatory fees has been highlighted in P. Kannadasan Vs. State of T.N.17; State of Tripura Vs. Sudhir Ranjan Nath18; B.S.E. Brokers’ Forum case (supra) and followed in several later decisions.” l. From the aforesaid judgments, we can arrive at the following conclusions: (I) The original concept of the law relating to quid pro quo to sustain a fee has undergone a sea change. As far as fee is concerned, there are different types of fees. A fee may be regulatory or compensatory. If it is for a particular service that the fee is levied, there must be a certain element of quid pro quo. A fee, which is, however, regulatory, does not require an element of quid pro quo and the only requirement is that it should not be excessive. In the case of a regulatory fee, even if no service is rendered, it could be validly treated as a fee and not a tax. A fee, which is, however, regulatory, does not require an element of quid pro quo and the only requirement is that it should not be excessive. In the case of a regulatory fee, even if no service is rendered, it could be validly treated as a fee and not a tax. The fact that the collections for the service goes to the consolidated fund of the State and is not appropriated towards expenditure for rendering the service is also not conclusive. (II) In this context, it is necessary to note that the development cess or the cess in question in these cases does not even go to the consolidated fund of the State as such. Instead, Section 31(1) of the Act provides that a fund known as Market Committee Fund is to be created to which all moneys received is to be credited. Entire expenditure incurred by the Committee is to be derived from the said fund. As per Section 31(2), the surplus is to be invested as prescribed. No doubt, we notice that no Rules have been made. Section 61 of the Act further provides for the creation of a separate fund known as the Uttarakhand Marketing Development Fund into which the contributions received under Section 31(4), except such percentage thereof as the State Government may direct, to be credited to the Board’s fund. Section 31(4) provides that every market committee shall, out of its net income (Mandi fee + Licence fee) of the financial year, pay to the Board as contribution as the State Government may, by notification, declare from time to time. We have already referred to Section 61 of the Act and the manner of utilization of the fund under Section 61. Section 62 of the Act specifically provides for the creation of a Kendriya Mandi Fund to be operated by the Managing Director. Inter alia, it provides that all amount of development cess received from the Mandi Samities under sub-section (5) of Section 31 is to be credited, besides other amounts, as the State Government or the Board may direct. Section 62 of the Act specifically provides for the creation of a Kendriya Mandi Fund to be operated by the Managing Director. Inter alia, it provides that all amount of development cess received from the Mandi Samities under sub-section (5) of Section 31 is to be credited, besides other amounts, as the State Government or the Board may direct. Under sub-section (2) of Section 62, the amount is to be used for aid to financially weak and under developed Committees in the form of loans and grants; development works in the hilly areas; expenditure involved on the value addition and processing of agriculture produce; and any other purpose as per the direction of the State Government or the Board. (III) Therefore, a perusal of the aforesaid provisions will show that the cess is not being credited even to the consolidated fund of the State. It is, in fact, going into the specified funds as provided. The learned Additional Advocate General has also pointed out that, when the funds are used for the purposes of development works in the hilly areas, it is also for the protection of the producers, who, on account of the lack of development works, are not able to market their produce properly. v. It is important to bear in mind that, in order that there is a violation of Article 301, there must be a direct effect on the movement of goods, whether outside the State or within the State, posed by the impugned Legislation or other action. If the matter is of a regulatory nature and if the control is in the form of regulation, which is essentially to regulate, there would be no violation of Article 301 of the Constitution. That revenue may be generated, would not, by itself, convert what is a regulatory measure into a taxing measure. The impugned Legislation is a market legislation. We would think that the Legislation, such as the present, would not, in such circumstances and in view of the law laid down, constitute an infringement of Article 301 of the Constitution of India. 41. Whether there is discrimination between goods brought from outside and goods produced within the State and, hence, violation of Article 14? i. The argument of Mr. 41. Whether there is discrimination between goods brought from outside and goods produced within the State and, hence, violation of Article 14? i. The argument of Mr. Pankaj Kumar, learned counsel appearing on behalf of some of the appellants, is that there is violation of Article 14, inasmuch as, under clause (iv) of Section 27(c), goods originating in the State of Uttarakhand, and which are subjected to market fee and development cess, are immune from further levy of market fee and development cess when the goods reach another market area within the State of Uttarakhand; whereas, when goods, after suffering market fee and / or development cess, are brought into the market area in the State of Uttarakhand from outside Uttarakhand, the same are visited with development cess under the proviso to clause (v) and, in fact, in clause (v), where the goods are brought for the purposes mentioned in clause (v) as such, market fee and development cess are again, both, payable. Hence, there is clear discrimination. ii. We are of the view that the contention of the State in this regard is to be upheld that there is no discrimination. All that the Legislature has provided for is that there should be levy of market fee and / or development cess at least once within the State of Uttarakhand. Clause (iv) deals with a situation, where market fee and development cess has been collected once under the impugned enactment from one of the market areas within the State of Uttarakhand. Having so collected market fee and development cess once from a transaction in one market area, the law, apparently in order to provide against double levy on the very same goods, provides that there will be no fresh levy when they are brought into another market area within the State of Uttarakhand. As far as the proviso to clause (v) is concerned, when market fee and / or development cess is collected in another State in respect of a transaction, which took place within that State, and the goods are brought for the purpose of processing or manufacturing; then the Act provides for levy of development cess alone and we cannot see any justification for the complaint of discrimination made by the appellants. The goods originating in the State of Uttarakhand and subjected to levy once in the State of Uttarakhand and the goods, which are brought from outside the State of Uttarakhand and which had been subjected to market fee and / or development cess in another State, cannot be treated as equals and they are to be treated differently. If the Legislature of the State thought it fit to levy market fee and / or development cess on such transactions, be it under clause (v), where both market fee and development cess is payable in respect of transactions covered by clause (v) as such, or under the proviso to clause (v), where only development cess is levied in respect of transactions covered by the proviso; we are unable to detect the vice of discrimination afflicting the impugned provisions. 42. Whether the impugned Legislation is bad for nullifying the earlier judgment and whether it is violative of Articles 14 & 19 of the Constitution having regard to it being retrospective? i. We are dealing with these issues together as they have an inter-connection. That a sovereign Legislature has power to make laws with retrospective effect is beyond reasonable doubt. The only caveat, which has been entered by the courts over a period of time, is that, in view of the mandate of Article 14 commanding the State not to act in an arbitrary manner and the mandate of Article 19 that any valid law be reasonable, if the retroactivity introduces and imposes cumbersome and oppressive terms; then, the courts may not hesitate to strike at the retroactivity. We are of the view that, in this case, the law cannot be attacked for it being retroactive. It is noteworthy in this regard that the Act came into force on 01.11.2011. Proceedings were taken, apparently, on the basis that “processing” embraces within its scope “manufacturing”. This Court held otherwise. That is to say, in the absence of the word “manufacturing”, if the goods are brought into the market area for manufacturing, it is not open to the market committee to levy market fee and cess. This judgment was pronounced on 01.01.2013. Meanwhile, the proposal for amendment was discussed apparently and the law was amended. It was notified two days after the date of the judgment. The amended law is made retrospective from the date of the original enactment, namely, 01.11.2011. This judgment was pronounced on 01.01.2013. Meanwhile, the proposal for amendment was discussed apparently and the law was amended. It was notified two days after the date of the judgment. The amended law is made retrospective from the date of the original enactment, namely, 01.11.2011. The retrospectivity stretches over a period of about 14 months only. No doubt, there is an argument that the appellants would not be able to pass it on and, having regard to the amount involved, it brings about an incursion into their fundamental right to be treated fairly, as also their right to carry on business. ii. It is apposite at this juncture to take note of the judgment of the learned Single Judge of the Karnataka High Court, namely, Justice H.L. Dattu, as His Lordship then was, passed in the case of Shamanur Kallappa & Sons vs. State of Karnataka & another (supra). That was a case, where sugar was exempted under the Karnataka Sales Tax Act under the Fifth Schedule therein. The exemption was granted to sugar, as described from time to time by the Additional Duties of Excise (Goods of Special Importance) Act, 1957, which, in turn, adopted the definition of “sugar” in the Central Excise Act, 1944, which defined “sugar” as any form of sugar produced in a factory ordinarily using power in the course of production of sugar. The court took the view that even imported sugar came within the scope of the exemption, provided it was produced in a factory ordinarily using power in the course of production of sugar. The Karnataka Legislature, however, thought it fit to, retrospectively, legislate on the basis that duties of additional excise would be imposed only on sugar, which is manufactured in India. Accordingly, it was that Entry 31, the relevant Entry in the Schedule as per which sugar stood exempted, was amended to indicate that tax was to be levied on imported sugar for the past periods. The learned Single Judge elaborately considered the matter and took the view that, in spite of the impugned amendment, in the absence of an express provision in the impugned Legislation, itself; imported sugar could not be taxed under the Act from an anterior date. The learned Single Judge elaborately considered the matter and took the view that, in spite of the impugned amendment, in the absence of an express provision in the impugned Legislation, itself; imported sugar could not be taxed under the Act from an anterior date. This was so laid down in the backdrop of a large body of case-law to support the proposition that there could not be taxation by implication and no tax could be imposed on the citizens without words clearly showing the intention to levy the burden and further that, where the purpose and object of an Act is to affect a vested right or to take away an existing right or create a new obligation or impose a new liability, the statute should specifically provide for it. Therefore, the learned Single Judge took the view that, in the absence of anything in the enactment to show that the Legislature intended to levy tax on the imported sugar for the past period, it could not be construed that the amendment would alter or deny the benefit of tax exemption for the past period extended by judicial interpretation of the word “sugar”. No doubt, the learned Single Judge, then, proceeded also to the question relating to the effect of retrospective levy. The court referred to a large body of case-law to the effect that all laws, which affect rights, generally, operate prospectively. There is a presumption against their retrospectivity if they affect vested rights and obligations, unless the Legislation is clear. The court referred to several correspondences to consider, whether the impugned Legislation was in the nature of clarification or validating an earlier enactment. The court took the view that, at no point of time, either the Government or the Department had any doubt in their mind that imported sugar would fall under the relevant Entry, which provided for exemption. The court, therefore, took the view that the impugned Legislation could not be construed as a validating enactment or curative statute or in the nature of clarification. The court, therefore, took the view that the impugned Legislation could not be construed as a validating enactment or curative statute or in the nature of clarification. We also notice that the court took into consideration the following principles laid down in Lohia Machines Ltd. vs. Union of India, reported in (1985) 152 ITR 308: “Retrospective validation is permissible, if tax already imposed is declared invalid owing to defect in legislation and not permissible if retrospectivity has the effect of imposing a tax not already sought to be imposed but in effect fresh levy.” iii. It is important to see further, however, that the learned Single Judge, in paragraph 36, proceeds to notice that “the implied imposition of tax made would be most unreasonable and arbitrary”. This understanding was on the basis that it was, for the first time, that a tax was sought to be imposed on imported sugar by inserting the words “produced and manufactured in India” after the word “sugar” in the relevant Entry retrospectively from the inception of the statute. The court considered the fact that such imposition will have considerable unexpected tax burden and it is, in this conspectus of facts, that the court took the view that the retrospective levy was dubbed unreasonable and unconstitutional and violative of Article 19(1)(g). iv. We are of the view, for reasons which we shall mention hereinafter, that the appellants cannot lay store by the principles enunciated by the learned Single Judge in the backdrop of the facts, which gave rise to the dispute. Incidentally, we may also notice the following observations of the learned Single Judge in the above judgment: “24. …Inability of the dealer to realise the sales tax from its customers during the period covered by retrospective operation of law is also not a relevant factor which affects the competence of the Legislature to enact a law imposing sales tax retrospectively and lastly the test of the length of time covered by the retrospective operation of amended law cannot, by itself, necessarily be a decisive test…” v. Therefore, we would think that these observations, far from advancing the case of the appellants, would detract from their case. We have already noticed that the period of retrospectivity is only about 14 months. We have also noticed the backdrop, namely, there was belief held by the enforcers of the statute that “manufacturing” was comprehended within “processing”. We have already noticed that the period of retrospectivity is only about 14 months. We have also noticed the backdrop, namely, there was belief held by the enforcers of the statute that “manufacturing” was comprehended within “processing”. There was litigation. It is, thereafter, that, apparently, the realisation dawned on the law-maker that the absence of the word “manufacture” may prove fatal. It is, in this context, we feel that the learned Single Judge was right in placing reliance on the judgment of the Apex Court in the case of R.C. Tobacco (P) Ltd. and another vs. Union of India and another, reported in (2005) 7 SCC 725 , wherein the court, inter alia, held as follows: “The factors which are generally considered relevant in answering the question as to whether a particular provision, which is in terms retrospective, ex facie discriminatory, or so unreasonable or confiscatory that it violates Articles 14 and 19 of the Constitution are: (i) the context in which retrospectivity was contemplated, (ii) the period of such retrospectivity, and (iii) the degree of any unforeseen or unforeseeable financial burden imposed for the past period.” vi. The court, thereafter, further held as follows, inter alia: “Although the length of time is not by itself decisive, the effect of the retrospectivity of the legislation in this case was less than two years. The tussle between the Excise Authorities and the petitioners started almost immediately upon the latter claiming and obtaining refunds of the excise duty paid by them on the manufacture of cigarettes. Between 2000 to 2003, the matter was pending in the High Court. While the proceedings were pending before the Supreme Court and the issue was still at large, Section 154 was enacted. In these circumstances, Parliament cannot be blamed for having at least awaited the decision of the High Court, nor can the statutory provision be questioned as being unreasonably retrospective.” vii. In such circumstances, we would think that the retrospective levy cannot be said to be oppressive or excessive so as to fail the test of fairness under Article 14 or reasonableness under Article 19. In this connection, it is noteworthy that, originally, Section 27(c)(iii) was what the Court had considered and, noticing the absence of bringing in agricultural produce for manufacturing as such, the court interfered with the matter. In this connection, it is noteworthy that, originally, Section 27(c)(iii) was what the Court had considered and, noticing the absence of bringing in agricultural produce for manufacturing as such, the court interfered with the matter. Subsequently, as we have noted, the clause, which would govern most of the cases before us, would be clause (v) and, more particularly, the proviso. That is to say, in respect of agricultural produce, which has already suffered market fee and / or cess, on their entry into any market area in Uttarakhand, only the development cess would have to be paid. This is a new provision, undoubtedly. But, these provisions hold sway expressly with effect from 01.11.2011. The retrospectivity is clear. The impact, as we have noticed, is limited to the development cess. At this juncture, we may also observe that, even in such cases, there is a complaint that there is a demand also for payment of market fee besides the cess. We make it clear that only the cess would be realizable. viii. The next question, which is connected as we have noticed, is whether the impugned Legislation must be interfered with for nullifying the earlier judgment of this Court. ix. The judicial function is, essentially, to adjudicate disputes. Once the disputes are adjudicated, neither by an executive fiat, nor even by legislation, can the judicial function be impaired or interfered with by either the Executive or the Legislature by either declaring it as non est or by nullifying it as such. That would be an impermissible encroachment by one organ of the State with the duties, powers and functions of another organ. But that apart, it is settled law that it is always open to the Legislature to take away the foundation of the factual and legal basis on which the judgment of the court rested and it is true that with retrospective effect, such exercise would not invite the wrath of the principle that judgments of the courts cannot be nullified by either the Executive or by the Legislature. x. We have gone through the judgment of the Apex Court in the case of S.R. Bhagwat and others vs. State of Mysore (supra). That was a case, where the matter arose in the backdrop of the State Reorganisation Act. The case had a chequered history behind it. It related to seniority. x. We have gone through the judgment of the Apex Court in the case of S.R. Bhagwat and others vs. State of Mysore (supra). That was a case, where the matter arose in the backdrop of the State Reorganisation Act. The case had a chequered history behind it. It related to seniority. The petitioners’ contentions had been accepted by the Central Advisory Committee to whom the representations had been forwarded under sub-section (5) of Section 115 of the Reorganisation Act. There were further writ petitions. The correctness of the decision of the High Court was unsuccessfully challenged before the Apex Court and there was final adjudication regarding the claim of the petitioners and others similarly situated for equation and seniority. The petitioners claimed that though they were senior in the final seniority list to many others, their juniors were promoted in the meantime on the basis of higher ranking in the provisional seniority list. Since their claim for being granted deemed dates of promotion with all consequential benefits was not accepted by the State of Mysore, the writ petitions were filed before the High Court of Karnataka and the High Court granted the following relief: “We, therefore, make a common order in all these writ petitions that the case of each of these petitioners be considered for promotion to the post next above the cadre of the post he was holding on 1.11.1956 as on the date on which any one of his juniors according to the final inter-State Seniority List was for the first time so promoted and that if he is found fit and promoted, he be given all the benefits consequential thereon including consideration for promotion to higher cadres and financial benefits. Time three months.” xi. Pursuant to the same, petitioners were granted the deemed dates of promotion. The matter had become final. Since financial benefits were not made available, contempt was filed, which was being adjourned and it is, while so, that the State issued the impugned Ordinance, which was converted into an Act. It is apposite to refer to the words, which were found objectionable, as can be seen by their being in italics, “but he shall not be entitled to payment of any arrears for the period prior to the date of his actual promotion”. Sub-section (2) of Section 11 also was the subject matter of attack. It is apposite to refer to the words, which were found objectionable, as can be seen by their being in italics, “but he shall not be entitled to payment of any arrears for the period prior to the date of his actual promotion”. Sub-section (2) of Section 11 also was the subject matter of attack. The same is as follows: “(2) Notwithstanding anything contained in any judgment, decree or order of any court or other competent authority the rights to which a civil servant is entitled to in respect of matters to which the provisions of this Act are applicable, shall be determined in accordance with the provisions of this Act, and accordingly, any judgment, decree or order directing promotion or consideration for promotion of civil servants and payment of salaries and allowances consequent upon such promotion shall be reviewed and orders made in accordance with the provisions of this Act.” xii. In such circumstances, the court, inter alia, held as follows: “18. A mere look at sub-section (2) of Section 11 shows that the respondent, State of Karnataka, which was a party to the decision of the Division Bench of the High Court against it had tried to get out of the binding effect of the decision by resorting to its legislative power. The judgments, decrees and orders of any court or the competent authority which had become final against the State were sought to be done away with by enacting the impugned provisions of subsection (2) of Section 11. Such an attempt cannot be said to be a permissible legislative exercise. Section 11(2), therefore, must be held to be an attempt on the part of the State Legislature to legislatively over-rule binding decisions of competent courts against the State. It is no doubt true that if any decision was rendered against the State of Karnataka which was pending in appeal and had not become final it could rely upon the relevant provisions of the Act which were given retrospective effect by sub-section (2) of Section 1 of the Act for whatever such reliance was worth. It is no doubt true that if any decision was rendered against the State of Karnataka which was pending in appeal and had not become final it could rely upon the relevant provisions of the Act which were given retrospective effect by sub-section (2) of Section 1 of the Act for whatever such reliance was worth. But when such a decision had become final as in the present case when the High Court clearly directed respondent-State to give to the concerned petitioners deemed dates of promotions if they were otherwise found fit and in that eventuality to give all benefits consequential thereon including financial benefits, the State could not invoke its legislative power to displace such a judgment. Once this decision had become final and the State of Karnataka had not thought it fit to challenge it before this Court presumably because in identical other matters this Court had upheld other decisions of the Karnataka High Court taking the same view, it passes one’s comprehension how the legislative power can be pressed in service to undo the binding effects of such mandamus. It is also pertinent to note that not only sub-section (2) of Section 11 seeks to bypass and over-ride the binding effect of the judgments but also seeks to empower the State to review such judgments and orders and pass fresh orders in accordance with provisions of the impugned Act. The respondent-State in the present case by enacting sub-section (2) of Section 11 of the impugned Act has clearly sought to nullify or abrogate the binding decision of the High Court and has encroached upon the judicial power entrusted to the various authorities functioning under the relevant statutes and the Constitution. Such an exercise of legislative power cannot be countenanced. 20. We, therefore, strike down Section 11 sub-section (2) as unconstitutional, illegal and void. So far as the underlined impugned portions of Section 4 sub-sections (2), (3) and (8) are concerned, they clearly conflict with the binding direction issued by the Division Bench of the High Court against the respondent-State and in favour of the petitioners. Once respondent-State had suffered the mandamus to give consequential financial benefits to the allottees like the petitioners on the basis of the deemed promotions such binding direction about payment of consequential monetary benefits cannot be nullified by the impugned provisions of Section 4…” xiii. Once respondent-State had suffered the mandamus to give consequential financial benefits to the allottees like the petitioners on the basis of the deemed promotions such binding direction about payment of consequential monetary benefits cannot be nullified by the impugned provisions of Section 4…” xiii. We are of the view that the context, in which the said judgment was rendered, is provided by the direction which was given; the proceedings for contempt taken; and the nature of the Legislation, which was brought in with retrospective effect, which had the effect of, without taking away the basis, the refusal to comply with the final binding judgment of the court. In other words, the court had directed that parties be given consequential benefits; whereas, the amendment provided that the parties will not get the consequential benefits, meaning thereby, the arrears of pay. We would think that the reliance placed on the said judgment, therefore, is not apposite in the circumstances. xiv. The earlier judgment of this Court proceeded on the basis of the legislative text and the mandate contained in Section 27(c)(iii) of the Act. When the Legislature realised the absence of the word “manufacture”, in conjunction with agricultural produce being brought into the market area for the said purpose, it stands to reason that when the legislative context was altered, the foundation was transformed and this cannot be treated as the case of legislative nullification of a judicial verdict. In such circumstances, we are of the view that it cannot be held that there is any legislative nullification as such. In a manner of speaking, as contended by the learned Additional Advocate General, there was a defect in the legislative provision on account of the absence of the word “manufacture”. That defect was rectified by insertion of the word “manufacture”. It was done with retrospective effect. Therefore, the legal premise, which was the very foundation for the earlier judgment, no longer continues to exist. In the case of National Agricultural Cooperative Marketing Federation of India Ltd. & another vs. Union of India & others (supra), the court, inter alia, held as follows: “The Legislative power either to introduce enactments for the first time or to amend the enacted law with retrospective effect, is not only subject to the question of competence but is also subject to several judicially recognized limitations. The first is that the words used must expressly provide or clearly imply retrospective operation. The second is that the retrospectivity must be reasonable and not excessive or harsh, otherwise it runs the risk of being struck down as unconstitutional. The third is apposite where the legislation is introduced to overcome a judicial decision. In such cases, the power cannot be used to subvert the decision without removing the statutory basis of the decision. There is no fixed formula for the expression of legislative intent to give retrospectivity to an enactment. A validating clause coupled with a substantive statutory change is therefore only one of the methods to leave actions unsustainable under the unamended statute, undisturbed. Consequently, the absence of a validating clause would not by itself affect the retrospective operation of the statutory provision, if such retrospectivity is otherwise apparent.” 43. Whether the levy is bad for the reason that there are no computation provisions in place? i. This, by far, to our mind, is the most vexed question. The argument of Mr. Ramesh Singh, learned counsel for the appellants, is, essentially, as follows: Section 27(c)(ii) provides for the levy of market fee and development cess by providing that the market fee shall be payable on the transaction of sale of specified agricultural produce in the market area at rates, which should not be less than 1 per cent, but not more than 2 ½ per cent of the price of agricultural produce so sold, as the State Government may, by a notification, specify. As far as the development cess is concerned, levy and collection of development cess at the rate, which is not less than ½ per cent and not more than 2 ½ per cent of the price of such deal is what is contemplated. The manner of realisation is provided in Clauses (A), (B), (C) & (D). Under Clause (A), if the produce is sold through a commission agent, the agent may realise the market fee and development cess from the purchaser and he is liable to pay the same to the Committee. Under Clause (B), if the produce is purchased directly by a trader from a producer, it is the trader, who becomes liable to pay the market fee and development cess. Under Clause (B), if the produce is purchased directly by a trader from a producer, it is the trader, who becomes liable to pay the market fee and development cess. Under Clause (C), if the produce is purchased by a trader from another trader, the trader selling the produce may realise the market fee and development cess from the purchaser and he is liable to pay it to the Committee, provided though, if the purchaser was only a licence holder, then he will become liable to pay the market fee and development cess. Under Clause (D), in every other case of sale, the purchaser becomes liable to pay the market fee and development cess to the Committee. The proviso to Clause (D) provides for a prohibition against any market fee or development cess being levied or collected on the retail sale of any specified agricultural produce, where such sale is made to the consumer for his domestic consumption only. The seller of the produce is not exempted from paying the development cess on the ground that he has not recovered the same from the purchaser. This is what is provided in the second proviso to Clause (D). It is, thereafter, that we come to the provision in controversy, namely, Section 27(c)(iii) and the further provisions. ii. Therefore, the argument runs that the Legislature has contemplated levy of market fee and development cess only in respect of the transactions of sale. The further argument is that the sale must, in turn, take place within the market area in the State of Uttarakhand, as there is reference to market fee being payable on the transaction of sale of specified agricultural produce in the market area. It is submitted by Mr. Ramesh Singh, learned counsel for the appellants, that, even proceeding on the basis that there is a valid levy and, on the basis of that, if we are to treat clauses (iii), (iv) & (v), read with the proviso, as charging Sections, in the absence of computation provisions, it is impermissible to levy the charge. It is submitted by Mr. Ramesh Singh, learned counsel for the appellants, that, even proceeding on the basis that there is a valid levy and, on the basis of that, if we are to treat clauses (iii), (iv) & (v), read with the proviso, as charging Sections, in the absence of computation provisions, it is impermissible to levy the charge. This is for the reason that, inasmuch as there is no sale or purchase effected of the agricultural produce in question in any market area in the State of Uttarakhand, insofar as the sale or purchase is already effected by the appellants from other States, it is impossible and impermissible to levy market fee and / or development cess. It is pointed out that, in the controversial clauses, namely, clauses (iii) & (v), read with the proviso therein, there is no reference to the method, by which the market fee or the development cess is to be calculated, as all that is said is that market fee and / or development cess, as the case may be, shall be payable. To buttress this argument, Mr. Ramesh Singh, learned counsel for the appellants, sought support from the judgment of the Apex Court in the case of CIT, Bangalore vs. B.C. Srinivasa Setty. In the said case, the question arose in the following factual matrix: In terms of the instrument of partnership of the assessee firm, goodwill of the firm was valued on the dissolution of the firm and the new partnership took over the assets including the goodwill. Section 45 of the Income Tax Act, 1961 provides for income tax being levied on the capital gains, which arose from the transfer of the capital assets. iii. Therein, the court took the following view: “Section 45 charges the profits or gains arising from the transfer of a capital asset to income-tax. The asset must be one which falls within the contemplation of the section. It must bear that quality which brings Section 45 into play. To determine whether the goodwill of a new business is such an asset, it is permissible, as we shall presently show, to refer to certain other sections of the head, “Capital gains”. Section 45 is a charging section. For the purpose of imposing the charge, Parliament has enacted detailed provisions in order to compute the profits or gains under that head. Section 45 is a charging section. For the purpose of imposing the charge, Parliament has enacted detailed provisions in order to compute the profits or gains under that head. No existing principle or provision at variance with them can be applied for determining the chargeable profits and gains. All transactions encompassed by Section 45 must fall under the governance of its computation provisions. A transaction to which those provisions cannot be applied must be regarded as never intended by Section 45 to be the subject of the charge. This inference flows from the general arrangement of the provisions in the Income-tax Act, where under each head of income the charging provision is accompanied by a set of provisions for computing the income subject to that charge. The character of the computation provisions in each case bears a relationship to the nature of the charge. Thus the charging section and the computation provisions together constitute an integrated code. When there is a case to which the computation provisions cannot apply at all, it is evident that such a case was not intended to fall within the charging section. Otherwise one would be driven to conclude that while a certain income seems to fall within the charging section there is no scheme of computation for quantifying it. The legislative pattern discernible in the Act is against such a conclusion. It must be borne in mind that the legislative intent is presumed to run uniformly through the entire conspectus of provisions pertaining to each head of income. No doubt there is a qualitative difference between the charging provision and a computation provision. And ordinarily the operation of the charging provision cannot be affected by the construction of a particular computation provision. But the question here is whether it is possible to apply the computation provision at all if a certain interpretation is pressed on the charging provision. That pertains to the fundamental integrality of the statutory scheme provided for each head.” iv. In this connection, it is also relevant to notice the following statements contained in the aforesaid judgment: “Goodwill is intangible in nature, insubstantial in form and nebulous in character and denotes benefit arising from connection and reputation. It is an asset of the business. It is not possible to predicate the moment of its birth. No business commenced for the first time possesses goodwill from the start. It is an asset of the business. It is not possible to predicate the moment of its birth. No business commenced for the first time possesses goodwill from the start. It is generated as the business is carried on and may be augmented with the passage of time. It is affected by everything relating to the business, the personality and business rectitude of the owners, the nature and character of the business, its name and reputation, its location, its impact on the contemporary market, the prevailing socio-economic ecology, introduction to old customers and agreed absence of competition. In the Income Tax Act, the charging section and the computation provisions together constitute an integrated code. When there is a case to which the computation provisions cannot apply at all then such a case was not intended to fall within the charging section. The relevant provisions pertaining to ‘capital gains’ suggest that the computing Section 48 is concerned with an asset capable of acquisition at a cost. Since goodwill generated in a new business is an asset which is acquired by way of production in which no cost element can be identified or envisaged, when such an asset is sold and the consideration is brought to tax, what is charged is the capital value of the asset and not any profit or gain. Moreover, the ‘cost of acquisition’ mentioned in Section 48 implies a date of acquisition, which cannot be determined in case of a new business. Having regard to the nature of goodwill it will be impossible to determine the cost of acquisition for Section 49(1). Nor can Section 55(3) be invoked, because the date of acquisition by the previous owner will remain unknown.” v. Next, he would also rely on the judgment in the case of Nalnikant Ambalal Mody vs. Commissioner of Income-Tax, Bombay. Therein, the appellant was an Advocate, who had maintained his accounts on the cash system. He was elevated to the Bench in the year 1957. Certain professional dues were received by him in the accounting year 1958 and 1959. He showed them in the return for the assessment years 1959-1960 and 1960-1961. They were assessed by the Income Tax Officer. He challenged the order in revision, which was decided against him. It was challenged before the Supreme Court under Article 136. Certain professional dues were received by him in the accounting year 1958 and 1959. He showed them in the return for the assessment years 1959-1960 and 1960-1961. They were assessed by the Income Tax Officer. He challenged the order in revision, which was decided against him. It was challenged before the Supreme Court under Article 136. By a majority, the Apex Court allowed the appeal on the basis that the receipts were not chargeable to tax either under the head of “professional income” or under the residuary head. The court noted that the income in question was the profits and gains of a profession and they fell under the fourth head, i.e. “profits and gains of business, profession or vocation”. They were, however, held to be not chargeable to tax under the said head because, under the corresponding computing section, namely, Section 10, income received by an assessee, who kept his accounts on the cash basis in an accounting year, in which the profession had not been carried on at all, was not chargeable and the income was found to be, in the said case, so received. Thereafter, the court proceeded to consider the question as to whether the receipts would be income under the residuary head of income, which was all sources of income other than those specifically mentioned in the other five heads. The court took the view that an income falling under any head could be charged to tax if it is so chargeable under the corresponding computing section. Considering the question whether it fell under the residuary clause, the court found that the argument was ill-founded. The court rejected the contention that whatever is included in the total income under Section 4 must be liable to tax. It was found that Section 4 does not refer at all to chargeability to tax. It was found that Section 3 states that tax ..…shall be charged in accordance with and subject to the provisions of this Act in respect of the total income and that the said provision did not provide that the entire total income is to be charged to tax. The chargeability was to be in accordance with and subject to the Act. In other words, it was found that it is chargeable only if it is so chargeable under the computing section corresponding to that head. The chargeability was to be in accordance with and subject to the Act. In other words, it was found that it is chargeable only if it is so chargeable under the computing section corresponding to that head. The court took the view that income has to be brought under one of the heads mentioned in Section 6 and could be charged to tax only if it is so chargeable under the computing section corresponding to that head. vi. We notice that in the case of Consumer Online Foundation and others vs. Union of India & others, reported in (2011) 5 SCC 360 , the Apex Court referred to the Principles of Statutory Interpretation, 12th Edition, by Justice G.P. Singh, wherein the learned Author had stated as follows: “26. In Principles of Statutory Interpretation, 12th Edition, at Page 813, Justice G.P. Singh states: “There are three components of a taxing statute, viz., subject of the tax, person liable to pay the tax and the rate at which the tax is levied. If there be any real ambiguity in respect of any of these components which is not removable by reasonable construction, there would be no tax in law till the defect is removed by the legislature.” The court further proceeded to hold as follows: “27. Thus, the rate at which the tax is to be levied is an essential component of a taxing provision and no tax can be levied until the rate is fixed in accordance with the taxing provision. We have, therefore, no doubt in our mind that until the rate of development fees was prescribed by the Rules, as provided in Section 22A of the 1994 Act, development fees could not be levied on the embarking passengers at the two major airports.” That is a case, where the court took the view that the tax was not leviable as the rate of the development fee was not yet prescribed by making rules. vii. The learned Additional Advocate General, in reply, would, first of all, point out that such a contention, as such, has not been raised in the writ petitions before the learned Single Judge. The answer in regard to the absence of computation provision given by him is that, clearly, the market fee and development cess would be assessed on the basis of the sale price. The answer in regard to the absence of computation provision given by him is that, clearly, the market fee and development cess would be assessed on the basis of the sale price. He would submit that there is a sale price, in fact, with reference to the market area even if sale is outside the State. At the same time, he would submit that no dispute has been raised by the assessees on this score. The market fee and development cess have to be computed with reference to the price, for which the goods have been brought, may not be in the market area in the State of Uttarakhand, but wherever they have been sold. He would submit that there would be documents evidencing the same. viii. As far as the judgment of the Apex Court in the case of CIT, Bangalore vs. B.C. Srinivasa Setty (supra) is concerned, we have extracted the paragraphs devoted by the Apex Court to the consideration of the question in the context of goodwill of a newly started business being transferred and the question, which must be treated as having arisen and decided, in the context of the fundamental elements, which go into the transfer of the capital assets yielding capital gains, which is made assessable to tax. Dehors the cost of an asset, going by the computation provision, there could not possibly be capital gains ascertained and it is there that the court found that, in the case of a new business, the cost of acquisition mentioned in Section 48 implies a date of acquisition, which is not possible. Therefore, the question, really, was whether, in such a situation, the play of computation provision is possible in respect of the interpretation, which was sought to be placed on the charging section. In other words, Section 45 levied tax on the capital asset and the question, which, therefore, went to the root of the chargeability of the alleged asset involved in the case, namely, the goodwill generated by a new business and the question, which, ultimately, fell for decision must be treated as being whether it could be treated as a capital asset, which lent itself to be taxed under Section 45. Therefore, that was a peculiar circumstance, where there is no specific levy, as is the case involved in these appeals. Therefore, that was a peculiar circumstance, where there is no specific levy, as is the case involved in these appeals. We may ask ourselves the question as to what would be the position when goods are brought in for the purpose of processing. There also, there is no sale within the market area. Equally, foods when brought for storage, would the tax mechanism fail and those transactions, which are otherwise specifically brought to tax, go out of the tax net for absence of transaction of sale within the market area in the State of Uttarakhand? ix. As far as the reliance placed on the judgment of the Apex Court in Nalnikant Ambalal Mody vs. Commissioner of Income-Tax, Bombay (supra), there also, the matter related to the scheme under the Income Tax Act. The charging section accompanied by the computing section provided an integrated code to decide the very question of taxability. No doubt, the learned Additional Advocate General does confess to the absence of any rules made under the Act, though the Act was framed in the year 2011. We are also further handicapped in the matter due to the absence of any rules. There can be no uncertainty about the fact that the law does levy the tax on goods brought in by the manufacturers for the purpose of manufacturing. In all these cases, the case of the appellants would appear to be that there has been a sale effected within the Mandis, which are located outside the State. There is no serious dispute that the levy is not based on the sale price but on any other basis. We do think that there must be a sale in a Mandi either in Uttarakhand or elsewhere and both market fee and development cess can be levied only with reference to their sale price. We say this because we do contemplate a situation, where goods are brought in by a manufacturer from his own farm and without there being a sale at all anywhere. We say this because we do contemplate a situation, where goods are brought in by a manufacturer from his own farm and without there being a sale at all anywhere. x. Acceptance of the contentions of the appellants could result in the following reasoning and result: (a) Whether it is a case covered by Section 27(c)(iii) or clause (v) or the proviso to clause (v), it is clearly a levy imposed by way of market fee and / or development cess in regard to the agricultural produce, which is brought into a market area within the State of Uttarakhand for the purpose of manufacture inter alia. There is no case projected before us in regard to the person liable to pay the tax. The taxing event or the subject of the tax also appears to be clearly articulated. The rate is not separately mentioned in Section 27(c)(iii) or (iv) or (v). Necessarily, the legislative intent appears to be that in regard to the agricultural produce covered by Section 27(c)(iii) or (v) or the proviso to clause (v), the rate is to be as provided in Section 27(c)(ii). Since the rate as also the price of the material with reference to which the rate is to be applied are conspicuous by their absence in Section 27(c)(iii), (v) and the proviso thereto, the State must retrace its steps and fall back on Section 27(c)(ii). Let us now analyse what Section 27(c)(ii) provides for. It provides power with the Committee to collect market fees. Market fees is made payable in Section 27(c)(ii) on the transaction of sale in the market area. At this juncture, it is necessary to refer to the definition of the word “market area” as contained in Section 2(xxviii), which reads as follows: “(xxviii) ‘Market Area’ means any area notified as such under section 10 or modified under section 11 of this Act.” b. Thus, market area contemplated in Section 27(c)(ii) would appear to be those market areas, which are notified under the Act. It may not be possible to contemplate a situation, where the sale takes place in a market area located outside the State of Uttarakhand and yet it is intended to be covered by Section 27(c)(ii). It may not be possible to contemplate a situation, where the sale takes place in a market area located outside the State of Uttarakhand and yet it is intended to be covered by Section 27(c)(ii). In other words, the market area alluded to in Section 27(c)(ii) with reference to which, on sales which take place therein, power to collect market fee is predicated, must be those located within the State of Uttarakhand. Thus, in other words, Section 27(c)(ii) contemplates imposition of market fees only on transactions of sale and, that too, within the market area. The rates are, undoubtedly, clearly mentioned and there can be no dispute about the same. Section 27(c)(ii) also makes it clear that the rate, as the Government may specify by notification, is to be applied with reference to the price of the agricultural produce so sold. Therefore, there must be a sale within a market area in the State of Uttarakhand and, on the price of such sale, the rate, which may be notified by the State Government by notification, is to be applied and the market fee arrived at. In regard to development cess, the maximum and minimum rates are mentioned and it is to be applied with reference to the price of the deal. The deal is proceeded by the word “such”. The word “such” would involve reference to the earlier part of Section 27(c)(ii). Therefore, it could be said that, be it the market fee or the development cess, it is predicated with reference to the sale in the market area. Now, if this is the position with reference to the levy of market fee and development cess in regard to the sale of agricultural produce, we must consider whether it is possible to apply the said criterion in regard to the bringing of agricultural produce into the market area for manufacture even if such transaction is preceded by a sale of such produce in a market area located outside the State. If a sale has taken place of the agricultural produce in a different State and it is brought to a market area within the State of Uttarakhand as defined and the said transaction, by itself, renders the agricultural produce exigible to market fee or development cess; then the question would necessarily arise as to how one would compute the market fee or the development cess. The provision contained in Section 27(c)(ii) of the Act, as such, cannot apply as there is no sale of the agricultural produce in the market area located in the State of Uttarakhand. The sale has taken place outside the State, may be in a market area located therein. But, that sale cannot be looked into for the purpose of determining either the market fee or the development cess, as that is not what is contemplated in Section 27(c)(ii) on the express language, which is employed. Since there is no sale in a market area as defined, there is no question of determining the price with reference to which the rate could be applied. c. It has been argued on behalf of the State that the price of the agricultural produce, for which it is sold in the market area located outside the State, is looked into and forms the basis for the purpose of the levy under Section 27(c)(iii) and clause (v). There is also a case that the price of the agricultural produce is ascertained and mentioned / notified and there can be no difficulty. d. The levy of the market fee and / or development cess can be done only if there is a law, which has specifically authorised the levy. We have no hesitation in accepting the case of the State that there is express basis for such levy in regard to the transaction of bringing agricultural produce into the market area for the purpose of manufacturing inter alia, as is contained in Section 27(c)(iii) and clause (v) read with the proviso. But, these provisions merely provide that, on these transactions, market fee/development cess shall be payable. No rules have been made. On what basis the persons, who bring the agricultural produce for processing or manufacturing into the market area, are liable to pay, is not at all mentioned in Section 27(c)(iii) or clause (v). We have already noticed that any reference to Section 27(c)(ii) may not help the State, inasmuch as, what is contemplated therein is ascertainment of market fee or development cess with reference to sale within the market area located in the State of Uttarakhand. We have already noticed that any reference to Section 27(c)(ii) may not help the State, inasmuch as, what is contemplated therein is ascertainment of market fee or development cess with reference to sale within the market area located in the State of Uttarakhand. If that be so, there would be merit in the contention that, even proceeding on the basis of there being levy provided by Section 27(c)(iii) and Section 27(c)(v) in regard to the transactions involved in these cases, inasmuch as no provision is provided for computation, the levy cannot be sustained. xi. We can also look at it from a different perspective. We have already referred to the definition of the word “Market Area”. Is it not possible to look at it differently in the sense as, in the cases before us, that is if the definition clause, which may not govern all situations and it may become inapplicable based on the context, as the definition clause itself declares, can it not be said that the market area is also capable of bearing the meaning in regard to cases covered under Section 27(c)(iii) and (v) and proviso to clause (v) that it impliedly refers to price in the market areas located outside the State and where the sale has, admittedly, taken place. If that interpretation is placed in regard to the word “market area” and if it is the sale price therein, which has been made use of for the purpose of arriving at the market fee / development cess, could it not be said that the levy is supported by provisions relating to computation, which flow from the provisions of the Act. In this context, it is apposite to notice that Section 27(c)(iii) refers to the agricultural produce reaching a market area of the State. No doubt, the purport of the said words is to refer to the situation, which is intended to be covered, as we have already reasoned. We find the same words attached to the word “market area” in Section 27(c)(iv). Likewise, the purport of Section 27(c)(v) and the proviso being to deal with agricultural produce brought to any market area from outside the State of Uttarakhand is made clear by the words, which are used. We find the same words attached to the word “market area” in Section 27(c)(iv). Likewise, the purport of Section 27(c)(v) and the proviso being to deal with agricultural produce brought to any market area from outside the State of Uttarakhand is made clear by the words, which are used. We would think that the absence of definite pleadings before the learned Single Judge would appear to have deprived the State of an opportunity to place the proper materials before the Court and also making it difficult for this Court to finally pronounce on the issue. We notice that the said contention has not been adverted to in the judgment of the learned Single Judge. The learned counsel for the appellants Sri Ramesh Singh, no doubt, pointed out that it was, indeed, pressed before the learned Single Judge and, what is more, an argument is referred to in the argument note. We, no doubt, find the following reference to the argument in the argument note (WPMS No. 822 of 2013): “3.2 The said position is further buttressed by the fact that even under Section 27, under which the present levy is sought to be imposed, provides for levy of market fee “at such rates, being not less than one percent and not more than two and half percent of the price of the agricultural produce so sold”. Hence, the computing Section of the present levy is only concerned with “agricultural produce sold”. In other words, the said computing Section does not contemplate or deal with agricultural produce brought within the market area “for manufacturing”. 3.3 It is a settled law that even if a particular transaction is covered by charging Section, the said subject cannot be taxed if the same does not fall within the computation provision. [see 1966 Supp. SCR 295 (298-H to 299 & E) & (1981) 2 SCC 460 – para 10].” xii. Similar ground is also taken in the appeal memorandums. But that would not mean that we can conclude that the said argument was actually pressed before the learned Single Judge. It is also not mentioned specifically in the appeals that the said argument was actually pressed as such and not considered. Similar ground is also taken in the appeal memorandums. But that would not mean that we can conclude that the said argument was actually pressed before the learned Single Judge. It is also not mentioned specifically in the appeals that the said argument was actually pressed as such and not considered. In such circumstances, we would think that, rather than pronouncing on this issue, we can leave it open, that is to say, we would refuse to pronounce on the contention; but, at the same time, in view of the fact that there is some merit in the contention of the appellants, as we have already noticed, we would leave open this question. 44. In one batch of cases, the learned Single Judge has declined to go into the merits and dismissed the writ petitions on the score that the conduct of the appellants therein will not measure-up to the standards expected of a writ applicant. The reason is that the writ petitions were disposed of in the earlier round on the reasoning that as the word “manufacture” did not figure in Section 27(c)(iii) of the Act, the levy was unauthorised. The writ petitions were filed by the appellants in this batch in the second round seeking to take the benefit of the earlier Bench judgment when, according to the learned Single Judge, there is no manufacturing as such involved and this led the learned Single Judge to take the view that the conduct was not appropriate. According to Mr. V.K. Kohli, learned Senior Counsel for the appellants, there was no such conduct and it was after hearing both the sides that the interim order was passed by the appellate court as well. Since we are deciding the matters on merit, we are disposed to take the view that the other matters also can be disposed of on the basis of our findings regarding the merits of the issue. We noticed that the learned Single Judge has, in fact, dismissed the writ petitions with cost. For the view that we are taking, we are inclined to delete the order as to costs and, to the said extent alone, the judgment in all these cases will stand modified. 45. We noticed that the learned Single Judge has, in fact, dismissed the writ petitions with cost. For the view that we are taking, we are inclined to delete the order as to costs and, to the said extent alone, the judgment in all these cases will stand modified. 45. The resultant position would be that we find there is no merit in the contentions of the appellants, which we have adjudicated on, and the appeals will stand dismissed, except as regards the deletion of cost as aforesaid. There will be no order as to costs. 46. As far as the appeals filed by the Krishi Utpadan Mandi Samiti against the judgment of the learned Single Judge in the earlier round are concerned, we have already expressed our view in this judgment as regards the amendments. Nothing else was pressed in regard to the findings of the learned Single Judge on the interpretation of the unamended provisions. Those appeals are also dismissed as regards the findings of the learned Single Judge in regard to the interpretation to be placed on the unamended provisions. 47. We only add in regard to the contention of Mr. Rahul Sripat, Advocate, that, in a case covered by the proviso to clause (v), if, apart from development cess, market fee is also levied; that cannot be sustained and such demands will stand quashed.