Punjab-Haryana High Court
Super Seeds Private Limited vs State Of Haryana And Ors. on 1 February, 2006
Equivalent citations: (2006)144PLR113
Author: Hemant Gupta
Bench: Hemant Gupta
JUDGMENT Hemant Gupta, J.
1. The primary challenge in the present writ petition is to the demand raised on 26.7.1993 vide Annexure P.8 for the period 1.4.1989 to 10.12.1991, claiming a sum of Rs. 5,26,489.87 towards the market fee in terms of the provisions of Punjab State Agricultural Markets Act, 1961 (hereinafter referred to as 'the Act').
2. It is the case of the petitioner that it is involved in manufacture/production on various kinds of seeds in particular that of cereals, pulses, oil seeds etc. the entire process of manufacture and production of seeds is governed and monitored under the Seeds Act, 1966 and the Rules framed thereunder.
3. The grievance of the petitioner is that the respondent Market Committee has found that market fee is payable by the petitioner although the petitioner is not dealing in food grains or agricultural produce and is only dealing in seeds as defined in the Seeds Act. Such seeds do not fall within the definition of agricultural produce within the meaning of Section 2(a) of the Act. It is the case of the petitioner that the distinction between seeds and grain is vital. The seed strictly speaking is an embryo and a living organism created in the supporting or food storage tissue. All the scientific research in framing would be of little use unless a farmer gets a seed, which is genetically pure possessing high germination percentage and vigour, high purity sound health etc. Only seeds with assured quality can be expected to respond to fertiliser and other inputs in an expected manner. Reference was made to the provisions of the process of certification under the Seeds Act.
4. The petitioner has also detailed the procedure of certification starting from producing seeds when the foundation seed is supplied to the farmers, who are registered with the petitioner. The details of land are identified in which foundation seed is to be sown for the seed crop. Such foundation seed is not normally available in the market for producing agricultural produce. The farmers are given instructions for the purpose of relevant stages of the crop i.e. land requirements, isolation of field where the foundation seed is to be sown i.e. field should be separate from other fields having the same crop i.e. land requirements, isolation of field where the foundation seed is to be sown i.e. field should be separate from other fields having the same crop. The general seed certification standards specifically lay down the phases of seeds certification, field inspections, to verify conformity to the prescribed field standards, established source of seed, supervision at post-harvest stage, processing and packing, seed sampling and analysis including genetic purity test, seed health test etc. Harvesting, thrashing and transport is also governed under the Seeds Act.
5. On the basis of the case set up, it is the case of the petitioner that the petitioner is not liable to pay market fee in respect of which show cause notice was issued to the petitioner on 7.9.1991. The petitioner has submitted its reply Annexure P.3. The petitioners submitted another reply on 23,12.1991 (Annexure P.6) in response to another show cause notice Annexure P.5 dated 16.12.1991. The petitioner also appeared for personal hearing with the relevant record but still demand notice has been issued on 26.7.1993 without considering any of the contentions raised by the petitioner in its reply.
6. In the written statement, the respondents have taken a preliminary objection that there is remedy of appeal available against the assessment order. On merits it has been submitted that the market fee is leviable on the produce of agricultural produce from the procedures/growers. The petitioner purchases agricultural produce from the producers/growers at the first stage like wheat, sarson and on the second stage it processes agricultural produce such as cleaning, sorting, use of chemical to prepare the good quality grain for seed purposes. Thus, growers sow the seeds and produce grain which is an agricultural produce. Therefore, in terms of Section 23 of the Act, the petitioner is liable to pay market fee.
7. The petitioner in its reply (Annexure P.3) to the show cause notice has pointed out that the petitioner is a Seeds Production Organisation in the Private Sector working on the style and pattern of National Seeds Corporation and Haryana State Seeds Development Corporation Ltd. The programme of seed supervision is carried out under the provisions of Seeds Certification Agency. Its every activity is recorded and controlled by this Agency. The process of certification begins with sowing and completes on tagging. Certified seed is the seed which conforms to the Seeds Act, 1966. It has been pointed out that the petitioner has not procured any agricultural produce from the purchasers other than the seeds and working as per the procedure laid down in the Seeds Act, 1966 for seeds production. In Annexure P.6, the petitioner reiterated its stand and also pointed out that the liability created by Market Committee, Karnal in the case of another seed development agency was exempted.
8. A perusal of the assessment order (Annexure P.8) dated 26.7.1993 shows that any of the contentions raised by the petitioner have not been considered. Even no reference has been made to such contentions. The petitioner has given detailed process of certification of seeds and has also pointed out that each of its activity is controlled and monitored by the Seed Agencies. Therefore, mere allegation that the petitioner is producing agricultural produce at first stage, will not make it liable to pay market fee, if the purchase is for the purpose of development of a seed in terms of Seeds Act and, therefore, the seed process will not be eligible to market fee.
9. Learned Counsel for the petitioner has also referred to a judgment of the Hon'ble Supreme Court reported as , Krishi Utpadan Mandi Samiti and Ors. v. Piliphit Pantnagar Beej Ltd. and Anr. wherein, it has been held that the production of seeds is an integrated process and needs to be regulated at every stage to maintain genetic identity and genetic purity. Therefore, the seeds are not specified agricultural produce under the provisions of U.P.Krishi Utpadan Mandi Adhiniyam, 1964.
10. Since, the respondents had not considered any of the contentions raised by the petitioner in reply to the show cause notice and has raised demand by a non speaking order, 1 am of the opinion that the liability created vide order Annexure P.8 is wholly unsustainable.
11. Consequently, the said order is set aside. It shall be open to the respondents to pass a fresh speaking order after considering the contentions raised by the petitioner and if considered necessary, after associating the petitioner.
The writ petition stands allowed in the above terms.