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Sholapur Bakar Khatik Association Vs. Sholapur Agricultural Produce Marketing Committee - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Application No. 857 of 1971
Judge
Reported in(1979)81BOMLR121
AppellantSholapur Bakar Khatik Association
RespondentSholapur Agricultural Produce Marketing Committee
DispositionPetition dismissed
Excerpt:
.....20-prosecution for operating as a trader except in accordance with the licence granted by the market committee-whether 'trader' should fulfil both the characters of seller and purchaser at the same time-whether goats and sheep are agricultural produce-whether bye-law 20 ultra vires the provisions of the act.;the definition of 'trader' in section 2(t) is clear and explicit, namely that a trader is a person who buys or sells agricultural produce. a trader need not fulfil the character of a seller and a purchaser at the same time; it is enough if he is one or the other at any time.;devendra trad. co. v. state of mah. [1974] mh. l.j. 463, muhammadbhai v. state of gujarat [1962] a.i.r. s.c. 1517, mohd. hussain v. state of bombay [1962] a.i.r. s.c. 97, and arunachalo nadar v. state of..........20 which specifies that trade in live stock, poultry and goats and sheep shall be regarded as wholesale sale. if therefore a single goat or sheep is purchased by any of the khatiks it will be regarded as a wholesale purchase within the meaning of bye-law 20 farmed by sholapur marketing committee,6. dr. r.s. kulikarni, appearing in support of this petition, has made mainly three grievances. he contends in the first place that members of the petitioner association viz. khatiks of sholapur are not traders within the meaning of that term as defined in the act. he has secondly contended that the sheep and goats which are being purchased by members of the petitioner association are not agricultural produce as defined in the act. thirdly and more emphatically dr. kulkarni contends that bye-law.....
Judgment:

Jahagirdar, J.

1. The petitioner in this petition is the association of Khatiks of Sholapur. The association itself is registered under the Societies Registration Act and has also been registered as a public trust under the Bombay Public Trust Act, 1950. The Khatiks, who are members of this association, purchase goats and sheep in the market and after slaughtering the same sell the meat in the market for personal consumption of the citizens of Sholapur. The purchase of goats and sheep is made by them in the Sholapur market. The purchases thus made by them are regular and organized inasmuch as such purchases are necessary for enabling them to carry on their own business of selling of meat.

2. Respondent No. 1 in this petition is Sholapur Agricultural Produce Marketing Committee which is a committee established under Section 11 of the Maharashtra Agricultural Produce Marketing (Regulation) Act, 1963, hereinafter referred to as 'the Act', Under Section 6 of the Act there is a prohibition against using any place in the market area for marketing of declared agricultural produce and also against operating in the market area as a trader, among other things, in relation to marketing of the agricultural produce without a licence issued by the committee under Section 7 of the Act. There is no dispute that Sholapur city has been declared as market area under Section 3 of the Act. It is also an admitted position and indeed it is the basis of this petition that Khatiks have not obtained any licence as required under Section 6 of the Act. The khatiks maintain that they are not required to obtain licences under Section 6 of the Act and they complain that the marketing committee is threatening them with prosecutions under Section 46 of the Act for making purchases of sheep and goats in the market of Sholapur. The petitioner therefore prays that respondent No. 1 viz. the marketing committee of Sholapur be restrained from compelling the petitioner, presumably its members, from obtaining licences under Section 7 of the Act. It has been mentioned that some prosecutions have been launched against the members of the association and one or two of such prosecutions have resulted in conviction. In order to get a declaration that the provisions of the Act do not apply to the purchase of sheep and goats made by the khatiks of Sholapur with a view to be saved from the criminal prosecutions launched or to be launched by the marketing committee this petition has been filed.

3. Before we proceed to consider the merits of the petition it will be necessary to notice some of the important provisions of the Act. The present Act replaces some original acts dealing with the same subject which were in force formerly and has been enacted as the preamble shows for regulating the marketing of agricultural and certain other produce in the market areas and markets to be established thereof in the city. As the title of the Act itself suggests, the Act deals with agricultural produce which term has been denned in Section 2 Clause (a) meaning all produce of agriculture, horticulture animal husbandry, apiculture, pisciculture and forest specified in the schedule. Section 3 of the Act empowers the State Government to declare its intention of regulating the marketing of such agricultural produce in such area as may be specified in the notification. Provision has been made under Sub-section (2) of Section 3 for the lodging of suggestions or objections by the members of the public within a specified period. After the expiry of the specified period the State Government under Section 4 may by another notification declare the area specified as market area. There is a provision in Section 5 of the Act for the establishment of a principal market and one or more subsidiary markets for every market area. The important section dealing with the regulation' of marketing of agricultural produce is Section 6 which says that no person shall on and after the date on which the declaration is made specifying a market area use any place in. the market area for the marketing of declared agricultural produce or operate in the market area or in any market therein as a trader in relation to the marketing of the declared agricultural produce without a licence or otherwise than in conformity with the terms and conditions of a licence. All these provisions however will not apply, according to Sub-section (2) of Section 6, to retail sales or to sales by an, agriculturist who sells his own produce or to sales made generally for the personal consumption.

4. Section 7 of the Act empowers the market committee to grant or renew a licence for the use of any place in the market area or for operating therein as a trader among others. Chapter III of the Act deals with the constitution and working of the market committees. In particular in Section 11 it has been provided that the State Government shall establish a market committee for every market area. The composition of the committee has also been prescribed by that section. Sections 12 to 28 of chap. Ill deal with the composition of the market committee such as election and terms of office of the members of the committee and other incidental matters. Section 29 which finds place in chap. IV of the Act enumerates the powers and duties of the market committee. The duty of a market committee is to provide such facilities for marketing of agricultural produce therein as the Director may from time to time direct. The Director referred to is a person appointed as a Director of Agricultural Committee by the State Government. Sub-section (2) of . 29 in particular provides that a market committee may regulate the entry of persons into the market, supervise the behaviour of those who enter the market for transacting business, grant, renew, refuse, suspend of cancel licences, maintain and manage the market, including admissions to and conditions for use of markets, regulate marketing of agricultural produce in the market area or the market and the payment to be made in respect thereof, weighment or delivery of the agricultural produce. The market committee is also empowered to enforce the provisions of the Act and rules, bye-laws and conditions of licence granted under this Act.

5. Section 61 of the Act empowers the market committee to make bye-laws in respect of market area under its management for determining the quantity of agricultural produce for the purpose of retail sale and for regulation of the business and the conditions of trading in the market area. A bye-law thus made may also provide that any contravention thereof shall, on conviction, be punished with fine which may extend to one hundred rupees. The penal provision for contravention of the provisions contained in Section 6(1) which as we have already referred above prohibits the use of the market area or for operating in the market area as a trader except in accordance with the licence granted by the market committee is contained in Section 46. As far as the present petition is concerned, the bye-law which is followed by the marketing committee of Sholapur is bye-law 20 which specifies that trade in live stock, poultry and goats and sheep shall be regarded as wholesale sale. If therefore a single goat or sheep is purchased by any of the khatiks it will be regarded as a wholesale purchase within the meaning of bye-law 20 farmed by Sholapur Marketing Committee,

6. Dr. R.S. Kulikarni, appearing in support of this petition, has made mainly three grievances. He contends in the first place that members of the petitioner association viz. khatiks of Sholapur are not traders within the meaning of that term as defined in the Act. He has secondly contended that the sheep and goats which are being purchased by members of the petitioner association are not agricultural produce as defined in the Act. Thirdly and more emphatically Dr. Kulkarni contends that bye-law 20 which defines that any sale in goats and sheep is wholesale is ultra vires the provisions of the Act and in particular of Section 61 read with Section 6(2) of the Act.

7. The first contention that the members of the petitioner association are not traders is based upon the premises viz. that the purchase made by the members of the association is not for the purpose of selling it in the same form in which it is purchased. Unless whatever goods are purchased by person in the market area or in the market are sold in the same form in which they were purchased a person so purchasing will not be a trader as defined in the Act. In other words, Dr. Kulkarni contends that in order that a person should be a trader under the Act he must indulge in an activity in an organized manner by purchasing and selling any particular commodity or produce. In the case of members of the association the purchases made of a goat or a sheep as and when they are required for the purpose of meeting the requirements of the citizens of Sholapur in relation to meat, the purchase is of an agricultural produce, if at all, and the sale is of altogether a different commodity. The upshot of this argument therefore seems to be that a person in order to be a trader as defined in the Act must be both-a purchaser and a seller of the same agricultural commodity. A person who merely purchases cannot be characterised as a trader. That at least is the submission of Dr. Kulkarni. It is difficult to accept this contention of Dr. Kulkarni in the face of the definition of the word 'trader' found in Section 2(t) of the Act which is as follows:

'trader' means a person who buys or sells agricultural produce, as a principal or as duly authorised agent of one or more persons;

The definition is clear and explicit viz. that a trader is a person who buys or sells agricultural produce. To accept Dr. Kulkarni's contention will be to substitute the word 'and' for the word 'or' contained in the definition which course is not permissible.

8. Apart from the clear and explicit language in which the definition of 'trader'' is couched there are other indications in the Act itself which show that a trader need not fulfil the character of a seller and a purchaser at the same time; it is enough if he is one or the other at any time. For example, Section 10 of the Act provides for a settlement of dispute between buyers and sellers which means, therefore that there will be persons covered by this Act who may be either buyers or sellers and disputes may arise between a buyer on the one hand and a seller on the other. More conspicuous is the provision contained in Section 31 of the Act which makes a market committee competent to levy and collect fees in, the prescribed manner from every purchaser of agricultural produce marketed in the market areas, The very fact that power has been given to a market committee to levy and collect fees from a purchaser of agricultural produce shows that there is a class of persons who will be nothing but purchasers of agricultural produce. Indeed the very object of the Act is to protect sellers of agricultural produce who are in our country mostly rural people and who are unorganized in their selling activities. In Devendra Trad. Co. v. State of Mah. [1974] Mh. L.J. 463, it was held that persons who buy Tendu leaves within Gondia Market Committee area were liable to take licences under Section 6(1) of the Act because though they buy Tendu leaves in their area they were held to be traders under the Act. In Muhammadbhai v. State of Gujarat : AIR1962SC1517 questions regarding the interpretation of the provisions of the Act and the bye-laws made by the marketing committee arose. The bye-laws which were the subject-matter of interpretation before the Supreme Court .provided for three classes of dealers to whom three different types of licences were issped. One class of traders covered by those bye-laws were permitted only to buy in the market area on payment of small licence fee but were not allowed to sell in the market area. Another case viz. Mohd. Hussain v. State of Bombay : [1962]2SCR659 , also deals with a person who was a purchaser and therefore was held to be covered by the provisions of the Act. In Arunachala Nadar v. State of Madras : AIR1959SC300 the Court was considering the validity of Madras Commercial Crops Markets Act the scope and objects of which were somewhat analogous to the provisions of the Act which we are considering It has been mentioned in that judgment that the purpose of the Act was for the regulation of buying and selling of commercial crops by providing suitable and regulated market by eliminating middlemen and bringing face to face the purchaser and the buyer so that they may meet on equal terms. The question whether a purchaser as such was a trader or not of course did not fall to be determined before the Supreme Court in that case. However looking to the scheme and the objects of the various Acts which have been passed in various States for the purpose of regulating agricultural produce and considering in particular the clear words of the definition in the Act before us the conclusion is inescapable that a trader means either purchaser or buyer of the agricultural produce as defined in the Act. He may of course fulfil both characters but it is enough if he fulfils one or the other character to be a trader under the Act.

9. The next contention of Dr. Kulkarni that goats and sheep are not agricultural produce is more easily disposed of. Agricultural produce has been defined under Section 2(1) (a) of the Act as meaning all produce (whether processed or not) of agriculture, horticulture, animal husbandry, apiculture, pisciculture and forest specified in the schedule. Item IX enumerates animal husbandry products which are covered by the Act and which include sheep and goat. That the sheep and goat are covered by the words animal husbandry cannot be disputed but Dr. Kulkarni says that in order that goat and sheep should be regarded as agricultural produce they must be used for a purpose connected with agriculture. It is, according to him, not enough that they are produce of agriculture. Animal like goat or sheep is capable of being used for multifarious purposes and it is according to Dr. Kulkarni not the object of the Act to regulate the sale or purchase of these animals if they are being used for a purpose which is not, connected with the agriculture. There must be a nexus between the produce and the object for which it is used. That would determine whether such a produce is agricultural produce or not. It is impossible to accept this argument because there are no such words of restriction in the Act itself. What is being overlooked by Dr. Kulkarni is the fact that the Act deals with agricultural produce and not produce for agriculture. It is the produce itself that is the subject-matter of the Act and not the produce in relation to a possible use to which it will be made that is covered 'by the Act. There are several agricultural produce such as wheat and rice which were also capable of being used for different purposes. They can be used for production of starch in a factory but that will not take them away from the comprehensive definition of agricultural produce as given in the Act, The question whether a thing is used as agricultural produce is entirely irrelevant while determining whether that agricultural produce is governed by the provisions, of the Act.

10. Dr. Kulkarni then proceeded to assail the marketing committee of Sholapur for not complying with what he regarded as mandatory provision of Section 61 of the Act. According to Dr. Kulkarni there is a duty cast upon the market committee to determine the quantity of agricultural produce which may be regarded as the quantity of retail sale. It is only after such determination is made by the market committee that the sale of any quantity above that quantity will be wholesale and that alone will be the subject-matter of various rules and regulations under the Act. In the instant case as we have mentioned above by bye-law 20 the marketing committee of Sholapur has declared that all trade in livestock, poultry and goats and sheep shall be regarded as wholesale. It is thus clear that the sale or purchase of a single goat or sheep will be wholesale trade and will not be retail sale. Dr. Kulkarni relies upon the provisions of Section 6(2) of the Act for contending that the provisions of Section 61 are mandatory. He points out that as per Sub-section (2) of Section 6 the prohibition contained in Sub-section (1) of that section will not apply to sales by retail. There is according to Dr. Kulkarni implicit in this provision an obligation to apply the provisions of the Act to only trade of wholesale and there must be some trade in retail which must be defined by the market committee which is empowered in this behalf to do so. It will be shirking of the duty cast upon the market committee if it does not in relation to any particular duty determine the quantity of the retail sale which must be exempted under Section 6(2) of the Act.

11. We find it impossible to agree with Dr. Kulkarni on the somewhat wide interpretation which he has sought to give to the provisions contained in Section 61 and Section 6 of the Act. Section 61 of the Act is a provision which bestows upon the market committee the power rather than a duty to make bye-laws for determining, among other things, the quantity of agricultural produce for the purpose of its retail sale. We do not see any provision either in this section or in any other section which casts an obligation upon the Market Committee to make bye-laws for the purpose of determining the quantity of retail sale. Retail sale itself has been defined under Section 2(1) (o) as sale of that produce not exceeding such quantity as a market committee may by bye-laws determine to be a retail sale. It is undoubtedly true that the market committee alone can make bye-laws for determining the quantity of retail sale which, by virtue of Sub-section (2) of Section 6, will stand exempted from the prohibitions contained in Sub-section (1) of Section 6 but that by itself does not lead to any necessary inference that what is cast upon the market committee under Section 61 is the obligation or mandatory duty which it must fulfil before applying its bye-laws to any agricultural produce. If the bye-law determining the quantity of retail sale of any agricultural produce is not the product of the Act, the rales and bye-laws of the market committee may become applicable to the entire sale of agricultural produce irrespective of the quantity of such sale. We are therefore, unable to accept Dr. Kulkarni's contention that bye-law 20 is ultra vires of Section 61 or is made in defiance of the mandatory provision contained in Section 61. The bye-law, according to us, is perfectly valid and under the provisions of that bye-law the market committee of Sholapur is entitled to regulate trade in sheep and goats as a trade in wholesale.

12. We therefore hold that the members of the petitioner-association are not entitled to make any grievance against the bye-law made by the marketing committee of Sholapur in respect of sheep and goats, against the insistence of the marketing committee that the members of the association should take licences they being traders within the meaning of the Act and against the prosecutions launched by the marketing committee against the members of the association for not taking licences as required by Section 6(1) read with Section 7 of the Act.

13. The petition therefore fails. The rule is discharged with costs.


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