Calcutta High Court (Appellete Side)
The West Bengal Marketing Board & Ors vs Ram Gopal Poddar And Ors on 29 July, 2013
Author: Arun Mishra
Bench: Arun Mishra
1
IN THE HIGH COURT AT CALCUTTA
Civil Appellate Jurisdiction
Present :
The Hon'ble the Chief Justice Arun Mishra
And
The Hon'ble Justice Joymalya Bagchi
M. A. T. NO. 1046 OF 2013
THE WEST BENGAL MARKETING BOARD & Ors. - APPELLANTS
-Versus-
RAM GOPAL PODDAR AND ORS. - RESPONDENTS
WITH M. A. T. NO. 1047 OF 2013 THE WEST BENGAL MARKETING BOARD & ORS. - APPELLANTS
-Versus-
RANIGANJ CHAMBER OF COMMERCE & ORS. - RESPONDENTS WITH M. A. T. NO. 1048 OF 2013 THE WEST BENGAL MARKETING BOARD & ORS. - APPELLANTS
-Versus-
JAYANTI LAL PATEL & ORS. - RESPONDENTS
WITH
C. A. N. NOS. 7169 TO 7171 OF 2013
For the Appellants : Mr. Pradip Kumar Roy
Mr. Joydeep Roy
For the Respondents : Mr. Saptanshu Basu
Mr. Kishore Dutta
Mr. Vijaya Bhatia
Mr. Ganesh Prasad Shaw
Heard on :
And
Judgment on : July 29, 2013
Arun Mishra, C. J. :
The intra-court appeals have been preferred questioning the legality of the interim order passed by the Single Bench on 20.6.2013 staying recovery of the market fees sought to be levied by the Asansol Market Committee, constituted under the West Bengal Agricultural Produce Marketing (Regulation) Act, 1972 (hereinafter referred to as the 'Act of 1972'). The Recovery has been stayed on 2 the ground that question has been raised whether the writ petitioners are traders within the meaning of section 2(t) of the Act of 1972. It has been observed that prima facie a person has to both purchase and sell agricultural produce in course of such person's business for such person to be regarded as a trader within the meaning of the Act and for the obligation to pay market fee under section 17A of the Act has to be fastened on such person. At the same time, restrain order has also been issued vis a vis petitioner from disposing of or alienating his or its fixed assets without the previous leave of Court. Similar interim orders have been passed in other writ petitions.
Aggrieved by the impugned orders, intra-court appeals have been preferred.
The facts are being mentioned from M. A. T. 1047 of 2013, in which the writ petitioners are Raniganj Chamber of Commerce and two traders. The averments have been made in the writ petition that the petitioner no.1, is a Chamber of Commerce and is a company registered under the Companies Act, 1956, looks after the interest of manufacturers and agriculturists and in particular of Raniganj Industrial Manufacturers and Agriculturists. Approximately, 563 members who are traders operating in and around Raniganj area. They are selling various commodities in and around Raniganj area. Asansol Market Committee decided all traders carrying on business within Asansol Sub Division and obtained licence under the Act of 1972 Market Committee has decided to collect and levy market fees on agricultural produce sold in the Asansol Sub Division Area. Earlier, for three years the market fees used to be realised by way of negotiation as submitted by the learned senior 3 counsel appearing on behalf of the writ petitioners. However, on 4.6.2012, decision was taken to levy market fees at the rate of Rs.5,000/- from those traders whose yearly turnover is upto Rs.2 crores, Rs.10,000/- in respect of traders whose yearly turn over is between Rs.2 crores to Rs.5 crores, Rs.20,000/- in respect of traders whose yearly turn over is between Rs.5 crores and Rs.10 crores, Rs.35,000/- with respect to traders, whose yearly turn over is between Rs.10 crores to Rs.25 crores and Rs.45,000/- in respect of traders whose yearly turn over is more than Rs.25 crores. Minutes of the meeting dated 4.6.2012, has been filed along with the writ petition as Annexure 'P-2'.
Now market fees is to be realised as per the aforesaid decision. It is submitted that earlier market fees used to be realised on the basis of negotiation was illegal and indicative of unfair practice. However, the fact remains that earlier for last three years market fees used to be realised by the Market Committee. But the petitioners submitted that market fees cannot be charged unless the service as stipulated in the statute is provided there has to be quid pro quo. The Market Committee is not authorised or empowered to levy fees on any commodities/agricultural produce sold in the market area. There is no proper constitution of the Market Committee. There is no declaration of the market area as envisaged under section 3(1) of the Act of 1972. Actual market complex has not been established by the Market Committee. Until and unless there is actual establishment of actual market, market fees cannot be realised. Constitution of Market Committee cannot be said to be in accordance with law. No infrastructure has been set up by the State of West Bengal. Pre-conditions for realisation of fees are not fulfilled. As such, the petitions have been filed. There 4 is no denial that the petitioners in the writ petitions are carrying on business and are trading in the agricultural produce also and they want to escape their liability. It is not in dispute that they are traders as envisaged under section 2(t) of the Act of 1972.
The Single Bench has passed the interim order on the ground that for being traders as envisaged under section 2(t) of the Act of 1972 person has to be ordinarily engaged in the business of purchasing and selling agricultural produce as a principal or as a duly authorised agent of one or more principals and includes a person ordinarily engaged in the business or processing or preservation of agricultural produce. It has been doubted whether petitioners can be said to be traders.
Aggrieved by the interim order granted by the Single Bench on the aforesaid ground intra-court appeals have been preferred by the Market Committee.
Mr. Pradip Kumar Roy, learned counsel appearing on behalf of the appellants, Market Committee, has submitted that no case was made out to grant stay. Realisation of tax or fees normally should not be stayed. He has further submitted that market fees was realised for the last three years on the basis of negotiation. Thereafter, criteria have been evolved in the joint meeting on 4.6.2012 of realization of fees as per actual turn over of trader. It cannot be said to be illegal or arbitrary in any manner whatsoever. He has placed reliance on the decisions, in the case of H.S. Jayanna & Brs. & Ors. -vs- State of Karnataka & Ors., (2002) 4 SCC 125 and in the case of Kishan Lal -vs- State of Rajasthan, AIR 1990 SC 2269.
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Mr. Saptanshu Basu, learned Senior Counsel appearing on behalf of the respondents has made five fold submissions. He has submitted that there is no market area established under section 3 of the Act of 1972. Constitution of the Market Committee is not there as per section 5(3) of the Act of 1972. There is no notification issued under section 5 of the Act of 1972. Vires of section 11(5) of the Act of 1972 has been questioned in the writ petition pending consideration before the Single Bench and lastly, he has urged, there is no quid pro quo as no services are being rendered by the Market Committee. Hence, no case for interference has been made out in the intra-court appeals. He has further submitted that the facts have not been correctly stated in the order. There were some cases where traders are not involved and in some cases traders are involved as contemplated in section 2(t) of the Act of 1972. The differentiation could not be noticed by Single Bench as common order had been passed. However, there are other aforesaid grounds on which interim relief is proper. Interim stay order granted by the Single Bench is justified on the aforesaid grounds in the facts and circumstances of the instant case.
We propose to deal with the submission raised for the purpose of interim relief; but the decision shall not have any impact on the final decision to be taken by the Single Bench as we are dealing with the interlocutory matter and any finding made in the interlocutory matter is not binding at the time when final decision is rendered.
The Act of 1972 has been established so as to provide for the regulation of marketing agricultural produce in West Bengal and for matters connected therewith. Similar acts were enacted in the various States in the year 1972 itself 6 so as to protect the interest of agriculturists. 'Agriculturist' is defined in section 2(b) of the Act of 1972. 'Market' has been defined in section 2(g) means a market established or declared as such under the said Act and for a market area and including principal market yard and sub market yard, if any. Section 2(h) defines 'market area' which means any area declared to be a market area under section 3 of the Act of 1972.
Section 3 of the Act of 1972 provides the State Government may by notification declare any area as a market area in which purchase and sale of such agricultural produce as may be specified in the notification shall be regulated. Section 3(2) of the Act of 1972 provides that no person shall set up, establish or continue or allow to be set up, established or continued any place for the purchase or sale of such agricultural produce as has been specified in the notification under sub section (1), except in accordance with the provisions of the Act of 1972.
Section 4 of the Act of 1972 deals with declaration of principal market yard and sub market yard. Section 5 of the Act of 1972 deals with constitution of Market Committee. Section 5(2) deals with the State Government's power to constitute Market Committee comprising with various members as provided in section 5(3) of the Act of 1972. Section 11 of the Act of 1972 provides that no action of a Market Committee shall be called in question merely by reason of the existence of any vacancy in or any defect in the constitution of the Market Committee at the time of taking such action. Section 12 of the Act of 1972 deals with the duties and functions of the Market Committee to establish market for the market area 'if so required' by the State Government and to grant or renew 7 any licence in the manner prescribed to traders commission agents brokers weighmen measurers warehousemen surveyors and other persons or firms referred to in the Act. There are various other functions specified in section 12 of the Act of 1972 with respect to market yard etc. Section 17 of the Act of 1972 deals with levy of the market fee notwithstanding anything contained in the Bengal Finance (Sales Tax) Act, 1941 or any other law relating to taxation of agricultural produce in force, the Market Committee shall levy fee on agricultural produce sold in the market area when agricultural produce are sold in the market. However, there is rider that no fee shall be levied in the same market area more than once in relation to the same agricultural produce irrespective of the number of transactions. There are various other provisions contained in the explanations I, II and III. Obligation is cast upon the licensed traders - in case licensed traders are buyers they shall pay fees to the Market Committee in the prescribed manner within a week from the date of the transaction.
Section 19 of the Act of 1972 provides constitution of Market Committee fund and section 20 thereof deals with its application. Various aspects are mentioned therein in respect of construction and repair of buildings and installation of equipment and maintenance of standard weights and measures, payment of pay, leave allowance, gratuity etc. of the employees, payment of interest of loan. Incurring expenses for training in marketing of the agricultural produce. There are various other aspects for application of the Market Committee fund as provided in Section 20.
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Along with the stay application, the appellants, Market Committee has filed various Notifications issued in the Gazette by the Government of West Bengal, Department of Agriculture, under section 1(3) of the Act of 1972. It was ordered that the Act of 1972 shall come into force with effect from 18th September, 2008. In Asansol and Durgapur (Part) as specified with reference to different police stations in the District of Burdwan.
Yet another Notification has been issued under section 3(1) of the Act of 1972 and the same is for whole of Asansol and part of Durgapur Sub Division comprising of police stations mentioned in the notification has been declared to be market area of Asansol Regulated Market Committee. Yet another notification has been issued under section 4(1) of the Act of 1972 specifying market area, market yard and the area shown in column no.4 under the police stations mentioned in the notification to be such market yard. Thus, there is not only establishment of market area but also declaration of yard and sub market yard.
Yet another notification has been issued under section 5(2) of the Act of 1972, wherein names of the Market Area Committee had been specified with respect to market in column 3 of Asansol and Durgapur (Part). Thus, there are other various notifications issued.
In view of the aforesaid notifications which have been filed the submissions raised by the learned Counsel appearing on behalf of the respondents/writ petitioners that no market area has been established under section 3 of the Act cannot be accepted. It is also not correct that there is no notification under section 5 of the Act of 1972. Alternative submission raised that in case there is notification under section 5(3), the same is violative of 9 section 5(3)(dd), is equally not acceptable as there is constitution of Market Committee and same is functioning in the area in question. With respect to quid pro quo, the Act has been enacted in order to safeguard the interest of agriculturists to ensure payment is made to them and the stand of the Market Committee is that application of market fund is being made as envisaged under section 20 of the Act of 1972 and they are rendering services as envisaged in the Act while regulating such businesses.
The learned senior counsel on behalf of respondents has also submitted there are hardly any agriculture fields in Asansol. We need not go into the aforesaid disputed question of fact that as the Act regulates trading in agriculture produce which, admittedly, takes places in area in question. The Single Bench has also not granted interim stay on the basis of quid pro quo and that is the question to be decided at the time of final decision after calling for affidavit-in-opposition and cannot be made a ground by us also to sustain interim stay.
The Single Bench had passed a common order in various writ petitions, whereas the facts were not similar. In the instant case the petitioners are traders and that was within the purview of section 2(t) of the Act of 1972. However, their case is that provisions of the Act are not applicable and they have questioned the vires of section 11 of the Act of 1972. Merely, questioning vires of section 11 cannot be a ground employed by the respondents-writ petitioners so as to sustain interim stay. Section 11 deals with the validity of the action of the Market Committee. It provides no action of the Market Committee shall be called in question merely by reason of the existence of any vacancy in or any defect in 10 the constitution of the Market Committee at the time of taking such action. Though vires of section 11 has been questioned without meaning to decide it, prima facie, it appears such action and vacancy in the constitution cannot invalidate the action under the provisions of the Act of 1972. Whatever that may be, the decision on this question has to be rendered by the Single Bench. We decline to dilate upon the submission any further and we keep all questions open to be adjudicated by the Single Bench.
The learned senior counsel, Shri Basu relied upon a decision in Kewal Krishan Puri & Anr. -vs- State of Punjab; AIR 1980 SC 1008 with respect to quid pro quo. Quid pro quo has to be seen in the fact of each case after receiving affidavit-in-opposition and doctrine of quid pro quo has to be seen in pragmatic manner as apparent from several decisions.
In Jaiprakash Associates Limited -vs- State of Madhya Pradesh & Oirs. , 2009(7) SCC 339, the aforesaid decision has been referred to a larger bench. Whatever it may be, since quid pro quo action is to be decided on the facts after affidavit-in-opposition is filed, no ground has been made so as to grant or sustain interim stay on the aforesaid argument urged by the respondents.
The submission raised by the learned Senior Counsel that there is no actual setting up of market area is wholly unsustainable. In our opinion, actual construction or setting up market area or yard is not necessary. Merely declaration of market area is enough. Once market area has been declared as per the provisions of section 17 of the Act of 1972, there is liability to make the payment of market fees.
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Moreover, we have no hesitation in setting aside the order impugned as normally levy of the fee/tax should not be stayed and it is not in dispute that for the last three years market fee was realised. There is no ground to grant interim stay. New criteria evolved on the basis of turn over cannot be said to be arbitrary one. There is no valid reason in the eye of law so as to sustain interim stay. As such, we are of the opinion that interim stay ought not to have been granted.
It is reiterated at the costs of repetition that any observation made by us shall not influence the Single Bench while deciding the matters finally.
We allow the appeals and set aside the impugned orders passed by the Single Bench. The applications are also disposed of.
(Joymalya Bagchi, J.) (Arun Mishra, Chief Justice)