Gujarat High Court
Dashrathbhai Jethabhai Patel vs State Of Gujarat on 24 August, 2022
Author: N.V.Anjaria
Bench: N.V.Anjaria, Samir J. Dave
C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/LETTERS PATENT APPEAL NO. 68 of 2020
In R/SPECIAL CIVIL APPLICATION NO. 20711 of 2019
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2019
In R/LETTERS PATENT APPEAL NO. 68 of 2020
With
CIVIL APPLICATION (FOR JOINING PARTY) NO. 1 of 2020
In R/LETTERS PATENT APPEAL NO. 68 of 2020
With
CIVIL APPLICATION (FOR PRODUCTION OF ADDITIONAL
EVIDENCES) NO. 1 of 2021
In R/LETTERS PATENT APPEAL NO. 68 of 2020
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE N.V.ANJARIA
and
HONOURABLE MR. JUSTICE SAMIR J. DAVE
==========================================================
1 Whether Reporters of Local Papers may be Yes
allowed to see the judgment ?
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the No
fair copy of the judgment ?
4 Whether this case involves a substantial No
question of law as to the interpretation
of the Constitution of India or any order
made thereunder ?
==========================================================
DASHRATHBHAI JETHABHAI PATEL
Versus
STATE OF GUJARAT
==========================================================
Appearance:
MR PK JANI, SR. ADVOCATE with MR HRIDAY BUCH(2372) for
the Appellant(s) No. 1,10,11,12,13,14,2,3,4,5,6,7,8,9
MR KAMAL TRIVEDI, ADVOCATE GENERAL assisted by MR VINAY
Page 1 of 35
Downloaded on : Thu Aug 25 21:16:06 IST 2022
C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022
VISHEN, AGP for the Respondent(s) No. 1
MR DHAVAL D VYAS(3225) for the Respondent(s) No. 2
NOTICE SERVED BY DS for the Respondent(s) No. 3
==========================================================
CORAM:HONOURABLE MR. JUSTICE N.V.ANJARIA
and
HONOURABLE MR. JUSTICE SAMIR J. DAVE
Date : 24/08/2022
CAV JUDGMENT
(PER : HONOURABLE MR. JUSTICE N.V.ANJARIA) Heard learned senior advocate Mr. P.K. Jani with learned advocate Mr. Hriday Buch for the appellants, learned Advocate General Mr. Kamal B. Trivedi, assisted by learned AGP Mr Vinay Vishen for the respondent State and its authorities and learned advocate Mr. Dhaval Vyas for respondent no.2, Director, Agricultural Produce Market Committee. Respondent No.3, Patan Agricultural Market Committee though served, has not opted to enter its appearance. Also heard learned advocate Mr. Dipan Desai, who is for the applicants wanting to join themselves in the proceedings of the present Letters Patent Appeal.
2. Preferred under Clause 15 of the Letters Patent, the challenge in this Letters Patent Appeal is addressed to judgment and order dated 20.12.2019 of learned Single Judge whereby he refused to interfere with the order of supersession of the Agricultural Produce Market Committee, Patan.
2.1 The captioned Civil Application No.1 of 2021 is Page 2 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 filed by the appellants praying to produce additional facts and evidence in the appeal.
2.2 As the proceedings of Letters Patent Appeal and the Civil Application bear nexus in facts, they both are treated together for disposal by the present common judgment and order.
3. The appellants-original petitioners happen to be the elected members of the respondent no.3 Agriculture Produce Market Committee (APMC). It was order dated 21.11.2019 passed by the competent authority of the Agriculture and Co-operation Department in exercise of powers under Section 46(1) of the Gujarat Agricultural Produce Markets Act, 1963, superceding the APMC, which was brought under challenge in the Special Civil Application. Upon superceding the market committee, it was ordered to appoint the administrator to run and manage the affairs market committee.
3.1 The aforesaid order dated 21.11.2019 superceding the market committee was preceded by show-cause notice dated 06.08.2019. While the charges and allegations mentioned in the show-cause notice are referred to in their requisite details hereinafter, briefly stated, the charges related to alleged irregularity and illegalities in the tender process for purchasing the tarpaulin, in the tender for construction and renovation of the canteen and in Page 3 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 respect of acquisition of the kitchen equipments etc., in grant and cancellation of licences, involvement and arrest of the Chairman of the Market Committee for the alleged offence under the Gambling Act. There was also a charge relating to payment of fees to the advocate, which was subsequently dropped.
3.2 The first charge was in relation to purchase of tarpaulin. It was alleged that the market committee proceeded to purchase 5000 tarpaulins though there was no need and that the purchase was made without prior approval of the Government required as per Resolution dated 10.04.2017. It was alleged that the tenders were issued without verifying the requirement; 28 parties submitted their bids; the market committee held negotiations with only four bidders. One of whom was M/s. Sarthi Agro Input, which had quoted lowest rate of Rs.1,750/- per piece.
3.2.1 It was alleged that the party named Shri Kushal Polymers was favoured and was awarded contract at the rate of Rs.1,850/- per piece. The order was placed worth Rs.92.50/- lakhs with the said party while not seeking prior permission of the State Government as required under the aforementioned resolution as well as market committee's resolution dated 23.06.2018.
3.2.2 It was the further allegation that the tarpaulin so purchased came to be distributed at the Page 4 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 rate of Rs.1,400/- per piece, giving subsidy of Rs.450/- per piece to the member agriculturists. It was alleged that since the need of the tarpaulin was not verified, majority of the stock remained idle.
3.2.3 It was alleged that in spending for purchase of tarpaulin as above, the monetary limit was exceeded by the market committee, and that for incurring higher expenditure, the permission of the State Government was not obtained. It was alleged that by giving subsidy of Rs.450/- per piece to the agriculturist members in the price of tarpaulin, sizeable fund came to be wasted. It was alleged that thus, the members of the market committee committed misconduct under Sections 23 and 26 of the Act.
3.3 Second allegation was with regard to the contract for construction of canteen, awarded to one Manojkumar Chaturbhai Patel for Rs.1.20 crores for the proposed renovation of the canteen after demolishing the building. It was alleged that the tender was awarded to the said party, which had quoted the rates higher by 18% as compared to the estimated price of Rs.1.02 crores. The awardee of the contract was close friend of the Chairman of the Market Committee and also co-accused with him for the offence under the Gujarat Prevention of Gambling Act, 1887, it was stated.
3.3.1 It was next alleged that though three other Page 5 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 builders had submitted their tenders, none of them were called for negotiation. It was alleged that various bills were paid to the said contractor, favouring him. It was stated that for giving of the contract in the above manner, the Chief Officer of the Municipality also issued notice and started inquiry. The allegations were levelled also regarding irregularities in purchase of various kitchen equipments.
3.4 The ancillary charges included carrying out the construction and renovation of the canteen without permission and without obtaining the revised plans from the Municipality, disobeying the notice issued by the Municipality to stop the illegal construction and for putting up construction on the land reserved for parking in the approved plans.
3.4.1 Irregularities were also alleged in respect of the contract given to M/s. Dipak Construction Company for Rs.15,11,602/- in respect of sanitary work for canteen building, in which process also, two other eligible bidders were not called for negotiations though there was no much difference in the rates quoted. It was alleged that the proprietor of the said party was son of the Director of Patan Taluka Vehchan Sangh, close friend of one of the Directors of the Market Committee.
3.4.2 Also were charges relating to Page 6 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 irregularities committed in awarding of tender for kitchen equipments, VRV-VRF Air conditioning system, in respect of giving contract for storm water pipeline and awarding the contract for purchase of electric fitting, CCTV, Firesystem, TV cabling, etc., as also in respect of giving contract for designing work of the canteen building. The gist of the allegations in respect of awarding of those contracts was that they all were awarded to a known party without calling the eligible bidders for negotiation whose rates were nearer.
3.5 The aforementioned show-cause notice dated 06.08.2019 came to be challenged by the petitioners by filing Special Civil Application No. 14362 of 2019, which was dismissed on 07-09.1.2019 by this court and the Letters Patent Appeal thereagainst was also dismissed.
3.6 In calling in question the show-cause notice and assailing the impugned order, it was inter alia the case of the petitioners that they were 14 elected members who were not affiliated with the party in power and therefore, they were subjected to allegations as above and the consequent action of supersession of the market committee. It was also their case that the entire action was a pre- determined approach by the authorities. The petitioners sought to establish it by demonstrating the sequence of dates and events.
Page 7 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 3.7 Learned Single Judge while upholding the impugned order of supersession, did not accept the plea of malafide, nor found favour with the submission that it was a pre-determined action. He recorded in para 26 of the order that malafide cannot be readily assumed merely by alleging them. It was stated that set of facts did not indicate the pre- determined mindset of the authorities.
3.7.1 Learned Single Judge however, considered the charges and recorded his own findings. Regarding the alleged charge about irregularities in purchase and distribution of tarpaulin, about giving subsidy of Rs.450/- while distributing the tarpaulin to member agriculturists, it was observed as under, "14.4 That the Committee resolved to act in consonance with the government resolution dated 10.04.2017 would suggest that the expense of Rs.450/- per Tarpaulin sheet by the Committee was in the spirit of a gratuitous payment in one kind and merely because it is termed as "subsidy", it does not absolve the Committee. It was rightly perceived by the State as 'donation' and therefore the breach of provisions of Section 33(11A) read with the resolution dated 10.04.2017 was apparent."
3.7.2 According to learned Single Judge, in awarding the tender contract to Kushal Polymers, the circumstances indicated irregularities, "14.5 Even on the question of awarding the contract to Kushal Polymers, what is revealed is that, pursuant to the public advertisement dated Page 8 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 27.06.2018, 28 bids came forth, of which only 5 were called for negotiation. No clarification or explanation has come forth that why when negotiations were held and Sarthi Agro had the lowest bid in terms of the advertisement and tender/offer conditions, the tender conditions were unilaterally changed resulting in 4 others to raise their bids except Kushal Polymers, who, then became the lowest bidder. These circumstances point to an irregularity in the award of the tender. The Committee's contradictory stand is recorded by the State Government when it records that when this tender was considered, 4 out of 28 were invited for negotiation whereas when the canteen tender was considered only one was invited for negotiation."
3.7.3 Learned Single Judge observed in para 14.6 that it was apparent that 5000 pieces of tarpaulin were ordered, out of which 2167 pieces had been long lying unsold of the worth of Rs. 40,08,950/- and the cash subsidy in respect of 2339 pieces was Rs. 10,52,500/-, which according to learned Single Judge, was misuse of funds to the extent of Rs. 50,61,500/-. It was observed in paragraph 14.7 that "Taking overall view of the matter, the case of the State that the Committee has abused its powers is made out".
3.7.4 In respect to the charge pertaining to extension, construction and renovation of the work of the canteen building, the learned Single Judge noticed to discuss the aspects and circumstances in paragraph 14.7 of the order to conclude that the Page 9 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 tender process stood vitiated for various reasons. It was observed that circumstances like non-obtaining of permission of Nagarpalika, sanctioning of bills in irregular manner, proximity of the contractor with the Chairman exposed due to their involvement in the gambling case, non-obtaining of permission from the competent authority regarding awarding of contract for kitchen equipments, electrification of canteen, sanitary work, etc., and such other circumstances were not in the nature of honest or innocent aberrations. Learned Single Judge recorded that the process of awarding said contract could not be said to be transparent.
3.8 With regard to other allegations regarding irregularities in issuing licences to the traders and involvement of the Chairman in the gambling act, etc., learned Single Judge took view that they were not the instances and circumstances which would warrant supersession of the Market Committee. In other words, the exercise of powers under Section 46 of the Act to supersede the Market Committee came to be upheld by learned Single Judge in the context of and in respect of two charges and allegations, firstly the charges pertaining to tendering process and distribution of tarpaulin and secondly with regard to award of contract for renovation and construction of canteen building. About the remaining allegations, the findings came to be recorded in favour of the petitioners that these Page 10 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 allegations could not have been basis for exercise of powers to supersede the market committee.
4. Learned Senior Advocate for the appellants while reiterating the contentions raised before the learned Single Judge, sought to assail the order of the learned Single Judge and the order of superceding the Market Committee on various counts, inter alia that none of the allegations could be termed as 'abuse of powers' so as to attract exercise of powers under Section 46 of the Act.
4.1 It was submitted that the entire process commencing from issuance of show-cause notice was pursuant to the two identically worded complaints lodged by certain traders against whom the Market Committee had taken certain action. It was submitted that the preliminary inquiry was conducted by the District Registrar, Patan, whose order was made the foundation for the action against the Market Committee, however, the very authority was party to the decision making process.
4.1.1 It was next submitted that learned Single Judge rejected the case of the petitioners about malafide in slip-short manner and that the circumstances did suggest that there was malice of fact as well as malice in law in initiating action against the very Market Committee. It was submitted that the entire exercise was motivated and actuated Page 11 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 by political malafide.
4.1.2 It was elaborated that the decision of the Division Bench of this court in Letters Patent Appeal No. 1790 of 2019 dated 18.11.2009 was received by the parties on 20.11.2019. The hearing was abruptly concluded on 19.11.2019 and the impugned order was passed on 21.11.2019; Notification was issued on the same day and administrator came to be appointed at 11.00 AM on 22.11.2019, who took charge accompanied by politically influential persons and also in presence of those persons who had given complaint on 02.04.2019. It was submitted that the caveat application was prepared on 21.11.2019, on the date of impugned order supersession, even before the Market Committee was served.
4.1.3 It was strongly submitted on the basis of the above dates and events that they evidently demonstrated malafides, and that those important aspects were completely ignored by learned Single Judge. It was then urged on behalf of the appellants that in order to supersede the Market Committee, Section 46 of the Act was misapplied. It was submitted that the supersession could happen only in the statutorily contemplated eventualities, namely that the Market Committee is not competent to perform its duties; secondly, that it consistently makes default in performing duties imposed on it or abuses its powers.
Page 12 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 4.1.4 It was submitted that the conditions were not satisfied to justify the resort to Section 46 of the Act. It was further submitted that other provisions in the Act such as Sections 27(4), 44(4), 47 and 48 could have been resorted to by the authorities if there was any error committed by the members of the Market Committee. Instead of exercising such supervisory powers, it was submitted, drastic powers of supersession were acted upon without formation of any opinion whether the facts of the case called for superseding the Market Committee and that it was an exercise done at the political dictates.
4.2 Defending the impugned order passed by the authority and pressing for dismissing the present appeal, it was submitted by the learned Advocate General that in illegalities and irregularities committed by the APMC, Patan, pertaining to purchase of tarpaulin and construction of canteen, involved were the acts of expending huge amount which was misuse and misapplication of public funds. He accordingly justified, terming the charges to be serious, the exercise of powers under Section 46 of the Act.
4.2.1 Learned Advocate General relied upon decision of the Supreme Court in The Management Of Narendra & Company Private Limited vs. the Workmen Page 13 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 of Narendra & Company [(2016) 3 SCC 340] to submit about the scope of the powers of the court while dealing with intra court appeal. It was submitted on the basis of the judmgent that in intra court appeal, on the findings of fact, unless the findings are found to be perverse, the same shall not be disturbed by the appellate court. It was highlighted that merely because another or better view is possible, the order of learned Single Judge should not be interfered with. For similar purpose, decision of the Division Bench of this Court in National Insurance Co. Ltd. Vs. Sreenath Industries [2020 (0) AIJEL-HC 243316] was pressed in service.
4.2.2 By pressing into service the decision of the Division Bench of this Court in Varvabhai Nathabhai Rabari v. State of Gujarat [2003(1) GLR 97], it was submitted on behalf of the respondents that when the Market Committee is superseded for the reasons of acts of commissions and omissions, the High Court would not interfere unless there is breach of principles of natural justice. From paragraph 10 of the said decision, the observations were relied on that it is well settled that in the matter of supersession of any elected body, the scope of judicial scrutiny and review under Article 226 of the Constitution is not that of exercising the powers of Court of appeal, but the same is restricted to procedural aspects.
Page 14 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 4.3 Learned advocate who appeared for the applicants of Civil Application No. 1 of 2021, seeking to be impleaded as parties respondents in this appeal and who were the complainant against the APMC who by their complaint pursuaded the authorities to take the impugned action against, adopted the submissions made on behalf of the authorities and defended the action as well as the order of learned Single Judge. It was submitted that there was misuse of funds by respondent no.3 APMC. It was submitted that the APMC ought to have acted as trustees of its funds.
Civil Application for production of additional material
5. During the pendency of the Letters Patent Appeal, the appellants filed Civil Application No. 1 of 2021 praying to permit to place certain documents produced along with application, on the record of the main appeal. It was prayed that the said documents may be treated as additional evidences in support of the contentions raised by the applicants-appellants.
5.1 The details and the supportive documents which the appellants seek to place on record of the appeal are,
(i) Application made to the Director of Agriculture Produce Market Committee seeking details about the permissions sought by the Agriculture Produce market Committee in the State including APMC, Unjha for Page 15 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 purchase and distribution of tarpaulin at subsidised rate including the audit reports of Unjha APMC.
(ii) Communication dated 04.06.2020 and 15.07.2020 from the Deputy Director and District Registrar, Cooperative Societies, Mehsana informing that no permission was given to Unjha APMC for the purpose of purchase and distribution of tarpaulin.
(iii) Unjha APMC purchased 8561 pieces of tarpaulin worth Rs. 1.61 crore in the year 2018-2019 by just giving one advertisement and without formal tender process. Purchases had been made from two different dealers at different rates. Total subsidy of Rs.58,64,650/- is given to the farmers and traders. Again, without issuing any advertisement and/or inviting any tender, the said APMC purchased 10,272 pieces of tarpaulin worth more than Rs. 2 crore in the year 2019-20.
(iv) After purchase of tarpaulin, the same had been distributed at subsidised rates. For example, in the year 2019-20, Unjha APMC distributed 10,272 pieces of tarpaulin and gave subsidy of Rs.650 per piece and thereby gave total subsidy of Rs.66,76,800/-.
(v) In support of the above, copy of the advertisement dated 14.04.2018 for purchase of tarpaulin by Unjha APMC at Rs. 1,950/- per piece dated 28.06.2018 and the audit report for the year 2018-19 and 2019-20 were produced. Further sought to Page 16 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 be produced was invitation card of the programme held at APMC, Unjha on 29.06.2019 whereat the tarpaulin was distributed at subsidised rate.
(vi) The auditors gave no objection with regard to purchase and distribution of tarpaulin at subsidised rate by Unjha APMC. It was stated that the authorities also okayed the purchase and distribution. It was next stated that auditor distinguished between subsidy and donation.
(vii) In yet another instance, Visnagar APMC, purchased tarpaulin in the year 2016-17 at the rate of Rs.2,250/- per piece totally worth Rs.45 lacs and distributed at subsidised rates. The subsidy amounted to Rs. 15 lakhs. The purchase orders were produced.
(viii) Visnagar APMC also decided to distribute charging torch to the agriculturists at the subsidised rates in the year 2019-20. A work order was given to purchase 7012 pieces of charging torch at the rate of Rs.630 per piece. The same has been distributed to the agriculturists at total subsidy amounting to Rs.19,83,254/-. Audit report was produced stating therein that the auditors there gave no objection.
(ix) The audit report of Visnagar APMC as well as Unjha APMC revealed that huge amount were spent for the purpose of purchase of note books and distributed Page 17 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 amongst the agriculturists and traders at subsidized rates. Moreover, Unjha APMC disbursed amount of Rs. 54 lacs as compensation to 28 persons for accidents suffered by them. No permission was taken even when such money was paid from their own funds.
(x) In case of Patan APMC, the authorities have a different opinion. It was stated that when a MLA applied under the Right to Information Act, to supply above details, only the audit reports were supplied and other details were refused.
(xi) Mahuva APMC also ordered to purchase tarpaulin in August 2020 at the rate of Rs.2,990/-. No such permission has ever been taken for purchase and distribution in Mahuva. In support of this, the advertisement as well as the work order were produced.
5.2 Following tabular form gives the details of purchase of tarpaulin, price thereof, etc, by Visnagar, Unjha and Mahuva Agricultural Produce Market Committee :-
Name of Purchase Quality of Quantity Price per Total amount APMC year Tarpaulin piece total purchase Visnagar 2016-17 200 GSM 2,000 2,250 45,00,000 7.31 X 5.48 sq. mts Visnagar 2017-18 200 GSM 111 2,250 2,49,750 7.31 X Page 18 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 5.48 sq. mts Unjha 2018-19 250 GSM 3,000 1,950 58,50,000 8 X 6 Sq.Mtrs.
Unjha 2018-19 250 GSM 5,561 1,850 1,02,88,205 8 X 6 Sq.Mtrs.
Unjha 2019-20 Plastic 10,272 1,850 1,90,03,200 tarpaulin (without mention of size GSM) Mahuva 2020-21 150 GSM 200 2,990 5,98,000 7.60 X 9.14 sq. mtrs.
Patan 2018-19 250 GSM 5,000 1,850 92,50,000
with ISI
mark 8 X 6
sq. mtrs.
5.2.1 In respect of respondent no.3 Patan
Agriculture Produce Market Committee, it was stated that best quality of tarpaulin at the lowest rate was purchased by it, still however, the office bearers were victimised.
5.3 In addition to the details of the tarpaulin purchased by different Agriculture Product Market Committees, following details were averred and sought to be produced as additional facts.
(a) As per Rule 44 of the Gujarat Agriculturist Produce Market Rules, an engineer is required to be appointed. The Director of APMC issued circular dated 20.09.2002, requiring the APMCs to have a panel Page 19 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 engineer to plan, design, float tenders and supervise construction activities of the purchase which may be undertaken by the APMC.
(b) By orders dated 04.04.2014 and 11.04.2017, one Shri Mansukhbhai Patel came to be appointed as empanelled engineer. On 23.06.2018, the managing committee of the Market Committee, Patan passed a resolution for renovation and expansion of canteen building as per the layout plan submitted by the said empanelled engineer, tenders are invited, which were opened and tender of one Manoj C. Patel was finally accepted on 05.09.2018.
(c) The empanelled engineer informed the managing committee that the canteen building was 50 years old and needed renovation process immediately, as the slab and plaster testing was necessary. The report was solicited from the engineer and based on the report received, the Managing Committee passed Resolution dated 05.11.2018 undertaking the construction activity as suggested by the engineer.
(d) The calling of only lowest bidder for negotiations by the Managing Committee was also not fraught with any error. The Roads & Buildings Department had informed on 20.10.2020, 21.10.2020 and 07.11.2020 that only the lowest bidder should be called for as per the policy of the Government.
(e) Under the provisions of the Gujarat Town Page 20 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 Planning and Urban Development Act, 1976, permission to put up construction within the market area was not necessary. Similar construction activity was carried out by the North Gujarat University, Patan and no permission was considered necessary.
(f) It was also stated that Visnagar APMC constructed huge canteen building in the year 2016-17 within its precincts at the huge cost of Rs. 3.50 crores, where also, permission was not required and not taken.
(g) Deesa APMC also carried out the construction and the Municipality by communication dated 22.12.2020, informed the APMC, Deesa that permission was not necessary for APMC in view of the provisions of the Gujarat Town Planning and Urban Development Act, as the APMC was local authority within the meaning of law.
(h) It was stated that the Deputy Director acted as a judge at his own cause. Reference of Government Resolutions dated 10.08.1998 and 26.04.1997 were made to suggest that they contain mandate that every meeting of the APMC has to be attended by the Deputy Director/District Registrar and the minutes of such meeting prepared under his supervision shall be sent to the office of the Director.
(i) All the resolutions regarding purchase and distribution and resolutions regarding renovation and Page 21 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 construction work of the canteen and other attendant steps, were submitted to the office of the Deputy Director and the copies thereof were submitted, however, no objections were raised at any point of time. The very officer has been finding errors and faults in such resolutions who himself became custodian/administrator of the APMC.
(j) The additional aspect was put forward that the Patan APMC had donated Rs. 25 lakhs to the Chief Minister Welfare Fund and the cheque was handed over to the Chief Minister by one Manoj Patel, who was amongst the complainants and instrumental in initiating the proceedings against the APMC was also present.
5.4 All the details narrated in (i) to (xi) and (a) to (j) hereinabove and sought to be produced as additional facts and evidence, are sought to be supported by the related documents annexed to the Civil Application.
6. The Civil Application for additional evidence was directed to be placed to be heard with the Letters Patent Appeal.
6.1 It was submitted that all the above additional materials were obtained during the pendency of the Letters Patent Appeal by making application under Right to Information Act. The application for additional evidence was filed on 04.01.2021. It was Page 22 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 submitted that the Letters Patent Appeal came up for hearing before the Court on 16.01.2020, notice was issued and appeal was fixed for hearing on 29.09.2020, however, due to Covid-19 Pandemic and for want of time, the appeal could not be heard. It was stated that in the meantime, the applicants could gather further evidence in support of the contentions they have raised in the appeal.
6.1.1 Learned Senior advocate for the applicants submitted that the additional materials and evidence proposed to be produced on record are quite germane to the issues of facts as well as the legal aspects involved and that they are required to be permitted on record to be considered in interest of justice and for proper decision in respect of the order challenged in the petition.
6.2 The prayer for production of additional evidence was vehemently opposed. Learned Advocate General drew attention of the Court to the observations made in paragraph no. 37 of the decision of the Apex Court in the case of H.S. Goutham Vs. Rama Murthy & Anr, [(2021) 5 SCC 241] wherein it was observed that as per the provisions of Order 41 Rule 27 of Code of Civil Procedure, 1908 the appellate court may permit additional evidence to be produced provided the conditions mentioned in Order 41 Rule 27 are satisfied and unless the conditions are satisfied, the parties to the appeal cannot be permitted to lead Page 23 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 evidence. It was submitted that necessary conditions are not satisfied and that no case is made out for permitting additional materials. It was submitted that normally the parties could not be allowed to produce additional evidence unless the overriding reasons exist.
7. The criteria and condition upon which the appellate court, in appeal, permit production of additional evidence are stated in Rule 27 of Order 41 of the Code of Civil Procedure itself.
(a) the court from whose decree the appeal is preferred has refused to admit evidence which ought to have been admitted, or
(b) the party seeking to produce additional evidence, establishes that notwithstanding the exercise of due diligence, such evidence was not
-within his knowledge or could not, after the exercise of due diligence, be produced by him at the time when the decree appealed against was passed, or
(c) the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such evidence or document to be produced, or witness to be examined.
7.1 It is mentioned in sub-rule (2) of Rule 27 that whenever additional evidence is allowed to be produced by the appellate court, the Court shall record its reasons for its admission. The provision Page 24 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 permits the appellate court to receive additional evidence in the appellate proceedings. The purpose is that, the appellate court is able to deal with the controversy in effective manner. The ultimate purpose of provision of such nature is to advance the cause of substantial justice. If the evidence is necessary for any other substantial cause, it is permitted. The test of due diligence by the parties is also prescribed.
7.2 It is not a cast-iron rule that the appellate court would not permit additional evidence. In Union of India Vs. Ibrahim Uddin [(2012) 8 SCC 480], the Supreme Court observed thus, "The general principle is that the Appellate Court should not travel outside the record of the lower court and cannot take any evidence in appeal. However, as an exception, Order XLI Rule 27 CPC enables the Appellate Court to take additional evidence in exceptional circumstances. The Appellate Court may permit additional evidence only and only if the conditions laid down in this rule are found to exist. The parties are not entitled, as of right, to the admission of such evidence. Thus, provision does not apply, when on the basis of evidence on record, the Appellate Court can pronounce a satisfactory judgment. The matter is entirely within the discretion of the court and is to be used sparingly. Such a discretion is only a judicial discretion circumscribed by the limitation specified in the rule itself. (Vide:
K. Venkataramiah v. A. Seetharama Reddy & Ors., AIR 1963 SC 1526; The Municipal Corporation of Greater Bombay v. Lala Pancham & Ors., AIR 1965 SC 1008; Soonda Ram & Anr. v. Rameshwaralal & Page 25 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 Anr., AIR 1975 SC 479; and Syed Abdul Khader v. Rami Reddy & Ors., AIR 1979 SC 553)".
(Para 36) 7.2.1 It was held that in Order 41 Rule 27, CPC, the appellate court has got power to allow a document to be produced and witness to be examined. It was stated that the requirement in this regard has to be limited to those cases where it is found necessary to obtain such evidence for enabling the court to pronounce the judgment. The provision does not however empower the appellate court to lead fresh evidence on record at the appellate stage if without such evidence, it can pronounce judgment in the case.
7.2.2 The appellate court however, may permit additional evidence when such evidence is of importance and constitutes a "substantial cause". In other words, the appellate court may allow the production of additional evidence in order to enable it to pass a satisfactory judgment in a case. To ensure satisfactory judgement in a case is the acid criteria for laying additional evidence permitted at the appellate stage.
7.2.3 While the evidence at the stage of appeal is not to be an easy reception, it is not to be rigid as well. The rigidity should not hamper the process of pronouncing a satisfactory judgment covering all the points and facilitating wholesome adjudication of the controversy, which the appellate court may Page 26 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 require to address in a given set of facts.
7.2.4 The test was stated by the Supreme Court of India in Ibrahim Uddin (supra). The decision in Ibrahim Uddin (supra) was followed by the Supreme Court in Andisamy Chettiar vs A. Subburaj Chettiar, [(2015) 17 SCC 713] wherein it was observed that irrespective of whether the applicant of the application for additional evidence had opportunity to produce such evidence at trial stage or not, admissibility of additional evidence does not depend upon relevancy of document to legal or factual issues, but it depends upon requirement of the appellate court to pronounce the judgment or for any other substantial cause.
7.3 Looking to the nature of the controversy involved in the main proceedings, the grounds on which the impugned order of supersession of the APMC, Patan, is founded and other attendant considerations mentioned herein, there is no gainsaying that the facts, the materials and the evidences proposed to be produced as additional evidence by the appellants in the proceedings of the present appeal, bear clear nexus to have relevance with the issues and aspects to be gone into in the Letters Patent Appeal while examining the challenge to the order of learned Single Judge.
7.4 As stated above, undoubtedly, the evidence Page 27 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 sought to be produced is related to the controversy.
They are materials, which are germane to the nature of lis between all the parties and to judge the legality and validity or otherwise of the order which was impugned before the learned Single Judge. The materials taken together to be viewed and comprehended with the challenge in the petition, would enable the Court to take an overall view and would further facilitate the Court to have a wholesome adjudication. The materials sought to be produced are not only related to the controversy, but could be said to be substantially concerned with the issue and the grounds of challenge involved.
7.5 It could also not be said that the documents and evidences sought to be produced are in the nature of altogether a new ground sought to be raised all of a sudden. On the perusal of the memo of the petition, the purchase of tarpaulin at subsidised rate is also mentioned as the ground in respect of the grievance and challenge. It is stated that similar subsidy was given by the Agriculture Produce Market Committee, Unjha. The said APMC distributed tarpaulin at subsidized rate in a function presided over by a high political dignitary . No action has been taken in this regard against Unjha APMC.
7.6 In the same way, when the reply to show- cause notice was filed by the appellants-original petitioners, it was mentioned that the facts Page 28 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 regarding Unjha APMC was mentioned stating that in earlier years, tadpatri was supplied and even subsidy was given by Unjha Agricultural Produce Markets Committee. It was declared that the help to the farmers by way of subsidy, in any case, cannot be equated with donation. The respondents submitted that when the market committee decided to give subsidy on tadpatri to the farmers and traders, Unjha Market Committee also had given the same to the farmers and traders by giving subsidy on higher rate and the same function is attended by the highest officers and no action had been taken under the Act.
7.7 It could not be said that there was no due diligence on the part of the applicants-appellants when they seek to produce the additional evidence at this stage. It is undeniably averred that they have been seeking information by making application under Right to Information Act and that due to intervening Covid-19 pandemic, the proceedings were delayed and in the meantime, the applicants could gather further materials and evidences in support of the contentions raised by them. It is also to be noted that the details sought to be produced are all part of and from the Government record.
7.8 In all the facts and reasons stated above, the Court is of the view that the materials and documents sought to be produced in the nature and form of additional evidence by filing this application Page 29 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 deserves to be allowed so as to enable the Court to take comprehensive view and for addressing the controversy regarding challenge to the impugned order in a complete manner.
8. Now, the powers are exercised by the competent authority under the Agricultural Produce Market Committee Act, 1963, and under Section 46 of the Act. The submission canvassed by the appellants was that straightway this drastic power of supersession was resorted to without adverting to other controlling and supervisory provisions, though the ingredients of the Section are not satisfied.
8.1 Section 46 of the Act reads as under :-
"46. Supersession of market committee.- (1) If in the opinion of the State Government a market committee is not competent to perform or persistently makes default in performing the duties imposed on it by or under this Act or abuses its powers, the State Government may, by notification in the Official Gazette, supersede such market committee : Provided that before issuing a notification under this sub-section, the State Government shall give a reasonable opportunity to the market committee for showing cause why it should not be superseded and shall consider the explanation and objections, if any, of the market committee.
(2) Upon the publication of a notification under sub-section (1) superceding a market committee the following consequences shall ensue, namely:--
(i) all the members as well as the Chairman and Vice-Chairman of the market committee Page 30 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 shall as from the date of such publication be deemed to have vacated their respective offices.
(ii) The State Government may at its discretion, either order that a new market committee be constituted under section 11 or make such arrangements for carrying out the functions of the market committee, as it may think fit; and
(iii) all the assets vesting in the market committee shall, subject to all its liabilities, vest in the State Government.
(3) If the State Government makes an order under clause (ii) of sub-section (2), it shall transfer the assets and liabilities of the market committee as on the date of such transfer, to the new market committee constituted under section 11 or to the person or persons, if any, appointed for carrying out the functions of the market committee, as the case may be.
(4) If the State Government does not make such an order, it shall transfer all the assets of the market committee which remain after the satisfaction of all its liabilities, to the State Agricultural Produce Markets Fund constituted under section 34. The Director shall utilise such assets for such object in the area as he considers to be for the benefit of the agriculturists in that area."
8.2 The essential condition to be satisfied for invoking the above powers is that, if in the opinion of the State Government, a market committee is not competent to perform or persistently makes default in performing the duties imposed under the Act or it Page 31 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 abuses its powers. It was therefore the main plank of submissions on the part of the appellants that the criteria to be applied for considering the challenge to the impugned order of supersession is whether the APMC, Patan was rendered liable to be superseded. The question that would call for examination is that whether the APMC, Patan-respondent no.3 incurred any of the disabilities mentioned in Section 46 of the Act, including whether it abused its powers within the scope, context and purport of the meaning of the phrase 'abuse of powers' occurring in the provision.
Order in Civil Application No. 1 of 2021
9. The Civil Application for producing additional evidence is allowed in terms of para 12(B). The applicants-appellants are permitted to place the documents annexed along with the application on record of the main appeal. They shall be treated as additional material in support of the contentions raised by the appellants for challenging the impugned order before the learned Single Judge as well as the order of the learned Single Judge under consideration in this appeal.
Order in Letters Patent Appeal
10. As the Court has permitted additional evidence on record of the present appeal as above, the challenge to the impugned order of supersession and confirmation thereof by the learned Single Judge is Page 32 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 required to be expediently examined afresh by considering the additional materials. The Court thinks it to be appropriate course that the entire challenge is examined anew by the learned Single Judge in light of the the additional evidence as above.
10.1 In order that the learned Single Judge is enabled to examine the impugned challenge afresh as directed above, the order of the learned Single Judge dated 20.12.2019 dismissing the petition is set aside. Setting aside of the order shall not have the effect of reinstatement of the market committee to the office.
10.2 It is further observed that when the learned Single Judge re-examines the challenge, it shall be a fresh exercise, and none of the findings recorded either in the order impugned in this appeal shall bind the learned Single Judge. All contentions for both the sides are left large to be considered on merits and in accordance with law.
10.3 It is clarified that allowing of the additional evidence to be produced on record of this appeal by this Court shall not be viewed or construed as any expression of merits by the Court in respect of the impugned order.
10.4 It is further clarified that the Court has not gone into the merits, nor has expressed anything Page 33 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 on merits. It is only by allowing the additional evidence, on the above ground, that the learned Single Judge shall be required to examine the controversy afresh. This Court has also not gone into merit-effect of the additional material on the challenge.
10.5 In order to balance the rights of the parties, till the learned Single Judge re-examines the challenge in the Special Civil Application, as directed above, and renders his fresh decision, the administrator/custodian who is holding the office to run administration of APMC, Patan, shall not take any policy decision.
10.6 The proceedings of Special Civil Application No.20711 of 2019 are transmitted back to learned Single Judge accordingly for his decision afresh.
10.7 The details and the documents sought to be produced as to the prayer in the Civil Application shall be permitted to be on record of the proceedings to be taken into account in accordance with law by learned Single Judge while deciding the controversy in light of the present order.
10.8 The Civil Application for stay would not survive and is disposed of.
10.9 The other Civil Application No. 1 of 2020 is disposed of without requiring any orders as Page 34 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022 C/LPA/68/2020 CAV JUDGMENT DATED: 24/08/2022 learned advocate appearing for the applicants was heard and submissions on behalf of the applicants have been considered.
11. The Letters Patent Appeal is allowed to the aforesaid extent and in the aforesaid terms and directions. The Civil Application No.1 of 2021 for additional evidence is allowed.
The Market Committee was constituted on 12.10.2017 and the term of 5 years is to expire on 11.10.2022.
In that view, it is open for either of the parties to request the learned Single Judge to give priority of hearing of the main petition. It is expected that learned Single Judge shall take such request in the facts and circumstances of the case.
(N.V.ANJARIA, J) (SAMIR J. DAVE,J) BIJOY B. PILLAI Page 35 of 35 Downloaded on : Thu Aug 25 21:16:06 IST 2022