1. This appeal has been filed by the State against the order of the Judicial Magistrate, First Class, Kolhapur, by which the respondent-accused was acquitted of an offence consisting of the alleged contravention of certain provisions of the Bombay Agricultural Produce Markets Act, 1939, and the Rules and Bye-laws made thereunder. The accused was the working partner of a firm which did business at Kolhapur. The city of Kolhapur is included in a 'Market' under the Bombay Agricultural Produce Markets Act, 1939, and transactions of the sale and purchase of agricultural produce in the market are governed by the provisions of that Act. The firm of the accused held a licence which enabled it to function as a trader as well as a commission agent in the market. On February 23, 1955, the accused, as a partner in his firm, sold 491 lumps of jaggery to the Sabarkantha District Co-operative Purchase and Sale Union, Himatnagar. He sent a bill for the dues of that transaction, which included certain items in addition to the price of the lumps of jaggery, and the items which are claimed by the prosecution to have been unauthorised were: (1) Es. 3-1-6 as 'Sadharan'; (2) Bs. 6-3-0 as 'Vatav'; (3) Rs. 7-10-9 as 'Panjarpol'; and (4) Rs. 12-1-0 as 'Marfat'. The prosecution case was that the accused, by including the above items in the bill, contravened three provisions: firstly, Section 17 of the Bombay Agricultural Produce Markets Act, 1939, a contravention of which is made punishable by Section 21; secondly, Rule 74 of 'the Bombay Agricultural Produce Markets Rules, 1941, a contravention of which is made punishable under Rule 77; and thirdly, Rule 12 of Bye-law 35A of the Bye-laws made by the Kolhapur Market Committee, a contravention of which is made punishable under Bye-law 68.
2. In his defence, the accused admitted having included the aforesaid charges in the bill, but he claimed that he had not committed any offence by doing so. He contended that these charges were his trade expenses and were not 'trade allowances' within the meaning of that phrase in Section 17 of the Act. His further defence was that the Bombay Agricultural Produce Markets Act, 1939, and the Rules and Bye-laws made thereunder, apply only to transactions in which an agriculturist producer sells his produce to a purchaser or commission agent, and that subsequent transactions of the sale and purchase of that produce are not covered by the Act and by the Rules and Bye-laws made thereunder.
3. In the Court below, the charge in respect of the item of Rs. 6-3-0 claimed as 'Vatav' was not pressed. Regarding the remaining three items, the learned Magistrate held that they were in the nature of trade expenses and not 'trade allowances. He also held that re-sales between traders of agricultural commodities are not covered by the Act, the Rules and the Bye-laws. On these findings, he held the accused not guilty of the alleged offence.
4. None of the facts found by the learned Magistrate has been challenged before us. According to the learned Magistrate, 'Panjarpol' is a charitable institution functioning in Kolhapur since 1906. Traders in Kolhapur who purchase jaggery from the primary producers pay 'Panjarpol' charges to the institution at the rate of one pice per lump of jaggery, and these traders in their turn recover the amount so paid from those who purchase the jaggery from them. The learned Magistrate found that, in the present case, the accused had himself paid Rs. 7-10-9 as 'Panjarpol' to two persons from whom he 'had purchased the 491 lumps of jaggery, and that in including the amount in the bill the accused merely tried to recover the expenses incurred by him in that behalf. 'Marfat' is the name given to the charges of carting agents called hundekaries, and these charges are calculated at a rate related to the number of cartloads, each of 24 lumps of jaggery, handled by the hundekaries. It is not disputed in this case that the accused had to incur these charges in despatching the goods to the Sabarkantha District Co-operative Purchase and 'Sale Union, Himatnager. 'Sadharan' is a charge which represents the aver-age of the expenses incurred by the local traders in Kolhapur for making arrangements for the lodging and boarding of their customers who come from outside places, and this charge is calculated at the rate of one anna for 24 lumps of jaggery purchased by the outside customers. The learned Magistrate found that this charge as well as the charges described as 'Panjarpol' and 'Marfat' were included in the bill by the accused according to a well-recognised custom in the Kolhapur market.
5. The main charge against the accused was that he contravened Section 17 of the Bombay Agricultural Produce Markets Act, 1939. Section 17 runs as follows:
No person shall make or recover any trade allowance, other than an allowance prescribed by rules or bye-laws made under this Act, in any market area in any trans- action in respect of the agricultural produce concerned and no civil Court shall, in any suit or proceeding arising out of any such transaction, have regard to or recognise any trade allowance not so prescribed.
An Explanation is included in the section and it is in the following terms:-
Every deduction other than a deduction on account of deviation from sample when the purchase is made by sample or on account of deviation from standard when the1 purchase is made by reference to a known standard or on account of difference between the actual weight of the container and the standard weight or on account of the admixture of foreign matter, shall be regarded as a trade allowance for the purposes off this section.
It is clear from this Explanation that it applies to all deductions, and provide that deductions other than those specifically mentioned in the Explanation are to be regarded as trade allowances for the purpose of Section 17. It is also clear from the context that the word 'deduction' in the Explanation means a deduction in the price which a purchaser has to pay or in the weight of the goods purchased. In the present case, the charges included in the bill by the accused are not deductions in any sense, but are items of expenditure added by the seller to the purchase price. It must, therefore, follow that they are not trade allowances under the Explanation to Section 17.
6. It was urged before us by the learned Assistant Government Pleader that the Explanation to Section 17 is not exhaustive of the meaning of the term 'trade allowance' used in Section 17, and that, although the Explanation comprehensively covers 'every deduction', the term 'trade allowance' would comprise an allowance not consisting of a deduction. If we were to accept the argument of the learned Assistant Government Pleader and to hold that the Explanation to Section 17 does not purport to define what is meant by a trade allowance, it must follow that the Legislature has nowhere denned that term, although it is provided by Section 21 that whoever makes or recovers any trade allowance in contravention of the provisions of Section 17 shall be punishable with a fine which may extend to Rs. 200. It appears to us, however, that the word 'allowance'' in its commercial meaning implies only a customary deduction, and if that is the ordinary meaning of the term 'trade allowance', it would follow that the Explanation, since it deals with 'every deduction', is exhaustive of the meaning of 'trade allowance' in Section 17 of the Act.
7. In Webster's New International Dictionary, 2nd edn., the meaning given to-the word 'allowance', when used in commerce, is 'a customary deduction from the gross weight of goods, different in different countries, as tare and tret.' The Dictionary further gives the meaning of 'trade allowance' to be the same as 'trade discount', and gives the meaning of 'trade discount' as 'a deduction from the retail or list price of goods allowed by a manufacturer or distributor to a merchant'. It would thus appear that a trade allowance1 means a deduction either in the weight of goods or in the purchase-price. A similar meaning is found assigned to the terms 'allowance' and 'trade allowance' in Chambers' 20th Century Dictionary. In Wharton's Law Lexicon, 14th edn., the general meaning of the word 'allowance' is given as a 'deduction, an average payment, a portion', and it is further observed (p. 54) :
Also in selling goods, and in paying duties upon them, certain deductions are made from their weights, depending on the nature of the packages in which they are enclosed, and which are regulated in most instances by the custom of merchants, and the rules laid down by public offices. These allowances, as they are termed, are distinguished by the epithets draft, tare, tret, and doff.
The terms 'draft', 'tare', 'tret' and 'cloff' are then explained, and the explanation of these terms shows that they apply to certain deductions from the weight of the goods.
8. It would thus appear that the term 'trade allowance' applies to deductions. allowed by custom either in the weight of goods sold or in the purchase price. ,If that is the correct interpretation of the term 'trade allowance', it must follow that the charges included by the accused in his bill, being in addition to the purchase-price, were not in the nature of trade allowances.
9. The learned Assistant Government Pleader relied on a recent decision of the Supreme Court in Arunachala Nadar v. State of Madras : AIR1959SC300 in which the term 'trade allowance' occurring in Section 14 of the Madras Commercial Crops Markets Act came up for interpretation. On the meaning of the term 'trades allowance', the judgment of the Supreme Court says:-.Allowance means something given as compensation, rebate or deduction. Under the section (i.e. Section 14 of the Madras Commercial Crops Markets Act), the said deduction should be in any transaction in respect of commercial crops. The deduction may be out of the commodity or out of the price. The recipient may be the seller, the buyer or a third party.... The question whether a particular payment is a trade allowance or not, depends upon the facts of each case. Firstly, it must be a deduction in any transaction in respect of commercial crops. If it is a deduction out of the price or commodity agreed to be paid or transferred, it would be a trade allowance. On the other hand, if the payment is 'de hors' the terms of the transaction but made towards consideration for the use of the premises or services rendered, it would not be a deduction from the price or in any transaction.
This passage, in our opinion, also indicates that a trade allowance must be a deduction either in the weight of the goods sold or in the purchase-price. The learned Assistant Government Pleader pointed out that in the above passage it has been stated that the term 'allowance' means something given as 'compensation, rebate or reduction', and he argued that the trade allowance may not be a deduction, but may be an amount given by way of compensation or' rebate without at the same time being a deduction. It appears, however, from the above passage that a trade allowance in all cases must be a deduction, though the deduction may have been given as compensation or rebate. The only substantial difference which we are able to find between the meaning of the term 'trade allowance' as given in Webster's New International Dictionary, Chambers' 20th Century Dictionary and Wharton's Law Lexicon on the one hand, and the aforesaid judgment of the Supreme Court on the other, is; that, whereas in the former the term 'trade allowance' appears to imply an allowance made in favour of the purchaser, it is specifically stated in the latter that the recipient of the trade allowance may be the seller, the buyer or a third party. But in any case a trade allowance must be a customary deduction either in the weight of the goods sold or in the purchase-price, and the charges made by the accused are not of that nature.
10. Supposing, however, that the learned Assistant Government Pleader is right in his contention that the term 'trade allowance' may have a wider meaning than what we have mentioned above, we must nevertheless put a narrow construction, on that term, as it occurs in a provision the contravention of which has been made penal by the Legislature. If the Legislature intended' that charges like 'Panjarpol', 'Marfat' and 'Sadharan', which are customarily imposed in several markets in the State, should be abolished or otherwise restricted, it was necessary that the Legislature should have expressed its; intention in clear and unambiguous terms.
11. Another reason why the acquittal of the accused must be confirmed is that, according to Section 17 read with Section 21 of the Act, what is made punishable is to' 'make or recover any trade allowance, other than allowance prescribed by rules or bye-laws made under this Act'. In this case, the accused has merely included certain charges in the bill which he sent to the Sabarkantha District Co-operative Purchase and Sale Union. It is not the prosecution case that he has 'recovered' the charges mentioned in the bill. Being the seller in the transaction, he cannot, of course, be said to have 'made' the alleged trade allowances. The mere inclusion of the charges in the bill' does not amount to an offence under Section 21 of the Act.
12. Turning next to Rule 74 of the Bombay Agricultural Produce Markets Rules,. 1941, the rule provides, in so far as it is material, that no licensed general commission agent shall solicit or receive fees other than those specified for his services in the bye-laws. Rule 77 penalises, amongst others, a licensed general commission agent who demands, receives or retains, on account of fees or under the colour of fees, any sum not due under the rules or the bye-laws. Now it is obvious that the charges made by the accused are not in respect of his fees as commission agent, nor are they made under the colour of fees of a commission agent. They are charges in respect of what he claims to have been his expenses. He cannot, therefore, be guilty under these Rules.
13. The last objection of the prosecution to the inclusion of these charges in the bill is that the accused thereby contravened Rule 12 of the 'Duties of General Commission Agents' mentioned in Bye-law 35A of the Bye-laws made by the Kolhapur Market Committee. Contravention of any of these bye-laws has been made punishable by Bye-law 68. Rule 12 in the aforesaid part of the bye-law reads as follows:-
The general commission agent or purchaser shall not charge any amount which is not authorised by the Act, Rules and Bye-laws.
A reference to the context in which this rule appears makes it perfectly clear that the rule applies where a general commission agent or a purchaser purchases an agricultural commodity from a seller. Rule 12 prevents a general commission agent or a purchaser from charging to a seller any amount which is not authorised by the Act, Rules and Bye-laws. It has no application to the charges which may be made by a general commission agent as against a person who purchases agricultural commodities from him. In the present case, the accused has sold jaggery to the Sabarkantha District Co-operative Purchase and Sale Union, and obviously Rule 12 has no application to this transaction.
14. In view of these findings, it is not necessary to deal with the other question, namely, whether the Bombay Agricultural Produce Markets Act, 1939, the Rules made thereunder, and the Bye-laws of the Kolhapur Market Committee, apply to the sale of agricultural produce by one trader to another.
15. The result is that this appeal fails and is dismissed.
16. No order on the application filed by the complainant.