Andhra HC (Pre-Telangana)
A. Hampayya vs The Secretary, Agricultural Market ... on 26 March, 1996
Equivalent citations: 1996(2)ALT19, 1996 A I H C 3568, (1996) 2 ANDH LT 19
Author: V. Rajagopala Reddy
Bench: V. Rajagopala Reddy
ORDER V. Rajagopala Reddy, J.
1. The petitioner, a licensed dealer in notified commoditions like Coriander seeds, Groundnut etc., under the A.P. Agricultural {Produce & Livestock) Markets Act, 1966 (for short, 'the Act'), challenges, in this Writ Petition, the levy of market fee and the best judgment assessment proceedings dated 31-12-1990 for the years 1981-82 to 1987-88.
2. The case of the petitioner, in short, is that, in fact, no Market Yard was established at Guntakal, in spite of Government issuing a G.O. Under Sections3 and 4ofthe Act establishing a Market Yard, hence the petitioner was transacting the sales in his village. In the absence of Market Yard it cannot be said that any services have been rendered by the Market Committee and in fact no facilities have been provided by the Market Committee to the traders. Section 12 of the Act empowers a Market Committee to levy market fee only in case the Government established a Market Yard providing adequate facilities for sales or purchases, to the traders, in a market area. Hence no levy of market fee would arise and the impugned assessment is illegal.
3. The 1st respondent filed a counter affidavit denying the allegation that there was no Market Yard at Guntakal. It was specifically averred that in pursuance of a notification issued by the Government in G.O. Ms. NO. 1311, dt. 11-12-1973, the Market Yards have been established in Guntakal and Gooti and the notified market area was specified as extending a radius of 16 km., around the office of Guntakal Municipality, within the notified area of Agricultural Market Yard, Guntakal. Subsequently an amendment to the notification dt. 20-9-1973 has been issued prescribing the area mentioned therein as Market Area of the Guntakal Market Yard. The allegation that no facilities have been provided by the Market Committee for the traders was also denied and it was stated that the Market Committee has spent about Rs. 45 lakhs for providing facilities in the new Market Yards and about Rs. 2,26,000/- for old Market Yard at Guntakal. Thus, the petitioner was liable to pay market fee.
4. The contentions of the learned counsel for the petitioner are three-fold:
(i) The Act underwent drastic amendments in the year 1987 by A.P. Agricultural (Produce & Livestock) Markets (Amendment) Act, 1987, (Act, 4 of 1987), (for short, 'the Amendment Act'), which came into effect w.e.f., 4-2-1987 by which, among other provisions, Sections 12-A to 12-C have been inserted in the parent Act prescribing the procedure for submission of returns relating to the turnover of the traders and making best judgment assessment of the market fee due from the traders. The parent Act has received the as sent of the President of India on 18-11-1966 and thereafter it was published in A.P. Gazette. However, the Amendment Act has not received the assent of the President of India, but was assented to by the Governor of A.P. on 4-2-1987. Hence the Amendment Act is inoperative, unenforceble and void. Consequently the impugned assessment made in accordance with Sections 12-A and 12-B of the Act is illegal.
(ii) The Government has not established any Market Yard at Guntakal, providing adequate facilities to the traders, within the meaning of Section 4 (3) (a) of the Act. Hence the levy of market fee Under Section 12 of the Act is not permissible.
(iii) The impugned assessment proceedings are barred by limitation prescribed Under Section 12-B (1), which prescribes a period of 3 years from the expiry of the year to which assessment is levied.
5. The second contention can be disposed of first, conveniently, in the light of the facts stated supra. The contention of the learned counsel for the petitioner that there was no Market Yard at Guntakal is controverted by the Standing Counsel for the Maket Committee and in support of his submission, he took us into the averments made in the counter affidavit. In view of the clear and categorical averments made in the counter affidavit filed by the 1st respondent, who is the Special Grade Secretary of the Market Committee, the assertion of the petitioner that there was no Market Yard at Guntakal has to be rejected. The Market Area of Guntakal was notified by a notification issued in G.O, Ms. No. 1311 dt 11-12-73 Under Section 4 (4) of the Act and the notified Market Area was specified as 16km. around the Guntakal Municipal Office, and the Market Area of the Guntakal Market Yard was also prescribed in the notification dated 20-9-1973, which was published on 31-7-1980. Admittedly the petitioner transacted his business at Kasavapuram within the market area and therefore liable for levy of the market fee Under Section 12 of the Act. In the course of the arguments, the learned counsel has almost abandoned his case that no Market Yard was established. In fact a petition W.P. M.P. 6523 of 1994 was already filed by the petitioner for appointment of advocate-Commissioner to ascertain when the Market Yard at Guntakal was established with all facilities as per the G.O. and notified. It is vehemently contended by the learned counsel that practically no facilities have been provided in the Market Yard and hence a Commissioner has to be appointed to ascertain the factual situation in the Market Yard. It is significant that the said application is not supported by any affidavit other than the affidavit filed by the petitioner in the Writ Petition. As stated above, the thrust of the petitioner's case in Writ Petition was that there was no Market Yard at all at Guntakal. The Market Committee has not been providing facilities in the Market Yard to the traders, was not the grievance of the petitioner initially. The affidavit is woefully Jacking in details on this aspect. No specific allegation is made with regard to the nature of the market that is existing and the nature of amenities that are yet to be provided. No material has been placed before us, to prima facie hold that the Market Yard at Guntakal was not providing the basic facilities. The learned Standing Counsel for the Market Committee has filed a 'statement' showing the facilities provided in the Market Yard. A perusal of the same would indicate that the Market Committee has spent huge amounts to the tune of Rs. 43,73,000/- in the new Market Yard and about Rs. 2,26,000/- in the old Market Yard at Guntakal, providing office buildings sanitary blocs, ryot guesthouses, open platforms god owns, weighing sheds, water connections etc. In view of the above facts and circumstances it is difficult to hold that the traders are deprived of the basic facilities in the Market Yard. In W.A. No. 517 of 1993 a Division Bench of this Court by its Judgment dated 7-8-1993 has also held that the Market Committee has established a Market yard at Guntakal by notification dated 20-9-1973 and subsequently by an amendment published in A.P. Gazette dated 31-7-1980. Further, the contention of the appellant therein that no facilities were provided by the Market Committee at Market Yard was also considered and rejected. It is also relevant to notice that the very same contention was raised in W.P. No. 429 of 1987 and was rejected by another Division Bench of this Court. The Apex Court in Sreenivasa General Traders v. State of A.P., and in City Corporation of Calicut v. T. Sadasivan, has unambiguously held that the traditional view that actual quid pro quo for a fee has undergone a sea change subsequent to the decision in Kewal Krishan v. State of Punjab, . All that was necessary is that there should be a reasonable relationship between levy of fee and services rendered. It is not necessary to establish that the traders have not received direct benefit of the services rendered for which the fee is being levied. If one receives general benefit from the authorities living the fee, the collection of fee is justified. The decision of a Division Bench of this Court in Pan Merchants' Wholesale Commission Agents Association, Hyderabad v. M.R.O., Musheerabad, Hyderabad, 1993 (1) An.W.R. 201 cited by the learned counsel for the petitioner to the proposition that no market fee can be levied unless a Market Yard was established Under Section 4 (3) of the Act, is of no avail to the petitioner since we have already held that the Market Committee has established a well regulated Market Yard within the notified area at Guntakal. It may be relevant to notice that the operation of the above Judgment has been stayed by the Supreme Court in S.L.P. No. 991113ofl993dt.l2-8-1993,theeffect of which now is the Judgment is wiped out. Another decision of a Division Bench of this Court in Agricultural Market Committee Anantapur v. Kulluru Subbi Reddy, relied upon by the counsel for the petitioner does not also come to his aid in view of the decisions of the Supreme Court cited supra and the conspectus of facts that are present in the case on hand, and particularly in view of the decision of this Court which already held that the Guntakal Market Committee has provided a well established Market Yard. Hence there is no force in this contention either and is therefore rejected.
6. Now we will deal with the first contention regarding the constitutionality of A.F. Agricultural (Produce & Livestock) Markets (Amendment) Act, 1987, Act, 4 of 1987. The said Amendment Act has received the assent of the Governor on 4-2-1987. By the said Amendment Act some provisions have been amended and certain other provisions have been inserted in the parent Act viz., A.P. Agricultural (Produce & Live Stock) Markets Act, 1966. New Sections 5-A, 5-B, 12-A to 12-G, 17-B, 17-C, 23-A, 27-A have been inserted. It is contended by the learned counsel for the petitioner that by reason of the parent Act (Act 16 of 1966) having been assented to by the President of India any legislation amending parent Act made only by the State Legislature and assented to by the Governor does not validate the Amending Act in that the President has not been approached for his consent. The amending law must be made in the same manner as the parent Act, proceeded the argument of Sri K. Venkataramanaiah. Article 254 of the Constitution of India is the relevant article in this context, which is extracted hereunder:
"254. (1) If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by parliament which Parliament is competent to enact, or to any provision of any existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of Clause (2), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case maybe, the existing law, shall prevail and the law made by the Legislature of me State shall, to the extent of the repugnancy, be void.
(2) Where a law made by the Legislature of a State..,, with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provision of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State:
Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter-including a law adding to, amending, varying or repealing the law so made by the Legislature of the State."
Clause (1) lays down the general rule and Clause (2) is an exception to Clause (1) and the proviso qualifies that exception. As per Clause (2) of the above Article when a law is made by the State Legislature on any subjects in the Concurrent List of VII Schedule of the Constitution, which is found to be repugnant of an earlier law made by Parliament or an existing law, such law of the State prevails if the assent of the President was received. However, it does not prevent the Parliament from legislating with respect to the subject covered by the law made by the State. In compliance with the above provision the main Act has been assented to by the President in order to save any of its provisions from being challenged in the court of law on the ground that such law was made on a subject in the Concurrent List. It does not, therefore, follow that any amendment to the present Act must also receive the assent of the President. This aspect has been exhaustively considered by the Division Bench of this Court in D.R. & B. Oil Mills v. State of A.P., . After a careful analysis of the relevant provisions of the Constitution of India, Chief Justice Chandra Reddy (as he then was) speaking for the Bench observed thus:
"It is thus plain that the President does not become a limb of the State Legislature merely because he gives his assent to certain Bills reserved for his consideration.............If we now examine the relevant provisions of the Constitution carefully it becomes clear that it is not every amendment that should be submitted for the assent of the President irrespective of whether the amendment involves any thing which calls for the assent of the President, merely because the main Act was referred to for his assent----.. A scrutiny of some of the Articles of the Constitution will also show that there are some provisions in relation to the assent of the President. Article 31, Clauses (3) and (6), which deal with laws that affect the right to property, require that such laws should be assented to by the President. Article 31-A which relates to the saving of laws provided for acquisition of estates etc., postulates that the assent of the President should be obtained to save such legislations from being challenged on the ground that they contravene any existing law or that they infringe the * fundamental rights guaranteed to the citizen.
Similarly, Article 254 requires that when there is repugnancy between a law made by the State Legislature and an earlier one made by the Parliament with respect to any of the matters enumerated in the concurrent list or an existing law with regard to that matter, the assent of the President should be obtained to save it from repugnancy......... Often, the parent Act by a State Legislature may contain some provisions which deal with a matter coming either (Sic) under list III and it is only to save a law made by such a Legislature from challenge on the plea of repugnancy between it and an existing law or a Parliamentary law that the device of obtaining the President's assent is resorted to........That does not follow that a minor amendment like the one contemplated by the impugned Act shall be reserved for the assent of the President though it does not in any way affect the free flow of trade or commerce......."
In the case on hand in the parent Act there are certain provisions which impinge upon the subjects falling under the Concurrent List. Hence, the State Legislature thought it necessary and appropriate to obtain the assent of the President to save the Act from a possible challenge in the courts. By that it does not follow that all amendments should be reserved for the assent of the President, though the amendments do not touch upon any subjects relating to any entry in the Concurrent List. The Division Bench decision in Padmanabhan v. Narayanan, AIR 1964 Kerala 92 in also to the same effect wherein it has been held:
"Even though under Clause (3) of Article 246 of the Constitution, the legislature of the State was competent to enact the impugned section, its validity would depend upon the further question whether or not any other Constitutional limitation has been transgressed in enacting the section. Clause (b) of Article 304 recognises the power of the State Legislature to enact laws imposing reasonable restrictions on the freedom of trade, commerce and intercourse with or within the State as may be required in public interest, but the exercise of the power has been made subject to the condition of having obtained previous sanction of the President. Article 304 modifies and controls the power conferred by Clause (3) of Article 246. These two articles have to be read and construed together for the purpose of determining the validity of the impugned section of the Act. The proviso to Clause (b) of Article 304 expressly prohibits the introduction and the moving of a bill without previous sanction of the President. The direction is mandatory and contravention of the proviso is, therefore, fatal to the validity and the legality of the section. Section 3 of the Act has therefore to be declared illegal and void and it naturally follows that the orders issued in exercise of the powers derived from that section being devoid of legal sanction have also to be declared void.
.....The condition precedent of President's previsous sanction is attached only to legislation which imposes restriction on freedom of trade, commerce or intercourse. Repealing is not imposing restrictions and so the proviso to Article 304 does not affect the validity of the repeal Under Section 73 of the Act if the repeal is otherwise valid. To see whether repeal is otherwise valid, what is to be looked into is whether the State legislature is competent to pass this legislation, because repealing is also a legislation."
The Kerala High Court, therefore, held that the Amending Act repealing the provisions was perfectly legal, though the President's assent has not been received since the entry relating to 'futures market' was principally concerned with the establishment of 'futures market' and entering into 'forward market' and 'futures market' and 'forward market' come within the expression of trade and commerce' of entry No. 26 in the State List.
7. In the instant case Sections 12-A to 12-C of the Act which are inserted by the Amending Act and their validity is now questioned in this writ petition. They relate to submission of returns of turnover by traders, assessment of market fee and payment of market fee and other dues payable under the Act. The argument is not that Sections 12-A to 12-C of the Act relate to any one of the entries in the Concurrent List so as to receive the assent of the President for their validity. In fact, they do not deal with any of the subjects in the Concurrent List. No decision was cited in support of the contention raised. In view of the Statement of law enunciated in the above decisions, we hold that it is not necessary to receive the assent of the President for the validity of these provisions on the sole ground that the parent Act was assented by the President Hence, this contention also fails.
8. The next contention relates to the bar of limitation. Section 12-B of the Act provides for the best judgment assessment in case the returns appear to be incorrect or incomplete. The said assessment shall be made only after making an enquiry. However, the assessment "shall be made only within the period of 3 years from the expiry of the year to which the assessment relates." It is stated in the Counter affidavit filed by the 1st respondent that a notice has been issued to the petitioner for paying the amount of Rs. 55,733,08 towards market fee and interest for the year 1980-81 to 1989-90. The petitioner submitted the assessment proceedings of the Dy. Commercial Tax Officer, Guntakal, and requested to assess the market fee. After verifying the proceedings issued by the Deputy Commercial Tax Officer, for the period 1981-82 to 1987-88 the Market Committee has issued assessment proceedings dt. 31-12-1990 for Rs. 15,689/-for the period 1981-82 to 1985-86 and for Rs. 2309/- for the period 1986-87 to 1987-88. Thus a total amount of Rs. 17,988/- was due from the petitioner and the same was sought to be recovered Under Section 12-C (iv) and Section 26 of the Act, in the same manner as arrears of Land Revenue. These proceedings are under challenge in this writ petition.
9. It is vehemently contended by the counsel for the petitioner that the Market Committee is precluded from recovery of market fee for the period of more than 3 years from the expiry to which the assessment relates. Admitedly the impugned assessment order relates for more than 3 years as it is for the period from 1981-82 to 1987-88. It is seen from the counter affidavit that best judgment assessment order is dated 31-12-1990. (The order is not filed in the material papers). The petitioner can therefore be held liable for the payment of market fee for the period commencing from 1986-87 in 1987-88 Under Section 12-B of the Act. The assessment relating to earlier periods, in our view, is clearly barred by limitation prescribed Under Section 12-B of the Act. It is contended by the learned Standing Counsel for the Agricultural Market Committees that several notices earlier to the impugned assessment have been served upon the petitioner, but on one objection or the other which are made by the petitioner only to drag on the passing assessment order, the final assessment could not be finalised. We cannot countenance this plea or this cannot be a valid explanation to arrest the bar or limitation. It is sought to be contended by Sri Harinatha Gupta that the writ petition was not maintainable as a remedy of appeal was provided Under Section 12-E of the Act and the Writ Petition was filed without availing the said remedy. We are afraid we cannot entertain this plea at this stage. In any event, in view of the fact that the constitutionality of the Amendment Act was also put in issue in the Writ Petition, we hold the Writ Petition cannot be held as not maintainable.
10. The respondents are, therefore, directed to recover only Rs. 2309/- being the liability of the petitioner with regard to payment of market fee for the assessment year 1986-87 to 1987-88 and the petitioner is directed to pay the same. The impugned order of assessment is accordingly modified.
11. Lastly, it is further contended by the learned counsel for the petitioner, after the case has been heard at length, after advancing arguments on some points, that the writ petition, ought to have been heard by a single Judge as per the Writ Rules, 1977 and that the petitioner has lost his right of appeal if the writ petition was heard by a Division Bench. This contention ought to have been taken as a preliminary objection at the threshold. It is not permissable for the learned counsel to raised this objection at this stage. This writ petition was directed to be posted before us since we have disposed of a batch of several writ petitions which arose under the above Act As a matter of fact we have also disposed of several writ petitions wherein the scope of Section 4 and 12 of the Act has been considered. In our discretion, and for the purpose of speedy disposal of cases, we thought that all the similar matters that arise under the Act relating to levy of market fees should be posted before us. This writ petition thus came to be posted before us. under Rule 14 (b) of the Writ Proceedings Rules, framed in exercise of the power conferred by Article 225 of the Constitution, no doubt, the writ petition has to be posted before a single Judge. The Rule also empowers the single Judge to refer it to be heard by a Bench of two Judges. Thus the hearing of the writ petition only by a single Judge does not appear to be, mandatory, in all circumstances and violation of the Rule cannot be said to vitiate the hearing. Rejecting the preliminary objection that the Bench of this court hearing the appeal under Letters Patent against an interim order passed by a learned single Judge in the writ petition could not by itself hear the writ petition, without there being a direction, for hearing the writ petition by a Bench, on the ground that right of appeal under the Letters Patent was deprived of, a Bench of this court, in which my learned brother M.N. Rao, J. is a Member, held in J. Nageswara Rao v. The Chairman-cum-Managing Director, Visakhapatnan Steel Plant, thus:
"The hearing of writ petitions is regulated by the Writ Proceedings Rules, 1977. Rule 14 (a) provides that certain writ petitioners relating to Habeas Corpus, elections and taxes are to be heard by a bench of two Judges. Rule 14 (b) provides that every other petition shall be posted before a single Judge, who may, if he thinks fit, refer any of them to a bench of two judges. There is a similar provision in respect of the rules relating to petitions under Article 227 of the Constitution where Rule 2 states that the said petitions may be posted for admission before a single Judge dealing with the writ petitions and the Judge may, if he thinks fit, refer it to a bench of two Judges........Rule 14 (b) of the Writ Proceedings Rules provides that the learned single Judge may, if he thinks fit, refer a writ petition to be heard by a Division Bench. If he does so, the respondents cannot complain of the loss of the right of appeal because that will be in exercise of the power specifically conferred by the rule. The only objection of the respondents is that that power cannot be exercised by the Bench but it can only be exercised by the learned single Judge. There are two reasons why this objection cannot stand scrutiny. Under Article 36 of the Letters patent, any function which is directed to be performed by the High Court in the exercise of its original or appellate jurisdiction may be performed by any Judge or by any Division Court thereof and, therefore, the powers of the Judges of the Court are co-extensive and when a power can be exercised by one Judge, there is no reason why it cannot be exercised by two Judges sitting together in the absence of a specific statutory provision forbidding such a course of action........The power reserved for a single Judge under Rule 14 (b) of The Writ Proceedings Rules, 1977 enures to the bench of two Judges to hear the writ appeal against the interim direction. Therefore, in exercise of such judicial discretion, we over-rule the preliminary objection of the respondents and decide to hear the main writ petition it self. It is also to be noted that unlike in the case of an application under Article 227, which has to be sent to the bench only by the learned Chief Justice, there is no provision in the rules relating to petitions under Article 226, that for the bench hearing the appeal against an order of the learned Single Judge in W.P.M.P. to hear the main writ petition, it has to be sent to the bench by the learned Chief justice."
In view of the above decision of the Bench of this Court, we have no hesitation in rejecting the contention of the learned counsel for the petitioner in this regard.
12. No other contention is raised. The writ petition is partly allowed and the assessment order is modified as indicated supra on page 20.
13. An amount of Rs. 8,000/- has been deposited by he petitioner pursuant to the interim direction of this court dt. 25-3-1994. After deducting Rs. 2,309/-from out of that towards market fees for the years 1986-87 and 1987-88, the balance amount shall be adjusted towards future liability. For the future years i.e., subsequent to 1987-88, while computing the three year period of limitation, the period during which this Writ Petition has been pending in this court shall be excluded.
14. In the circumstances, we award no costs.