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Venugopala Rice Mill and ors. Vs. Secretary, Agricultural Market Committee, Palakol and anr. - Court Judgment

LegalCrystal Citation
SubjectOther Taxes
CourtAndhra Pradesh High Court
Decided On
Case NumberW.P. No. 3585 of 1978
Judge
Reported inAIR1981AP189
ActsAndhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966 - Sections 7(1), 12, 12(1) and 12(2); Essential Commodities Act, 1955 - Sections 3; Andhra Pradesh Rice Procurement (Levy) and Restriction on Sale Order, 1967; Andhra Pradesh Rice (Procurement Ex-Mill Prices) Order, 1975; Constitution of India - Article 226
AppellantVenugopala Rice Mill and ors.
RespondentSecretary, Agricultural Market Committee, Palakol and anr.
Appellant AdvocateT. Raman, Adv.
Respondent AdvocateR. Narsimha Reddy, Adv.
DispositionPetition allowed
Excerpt:
other taxes -market fee - sections 12 (1) and (2) of andhra pradesh (agricultural produce and livestock) markets act, 1966 - market fee payable by purchaser under act - respondent committee issued demand notice to petitioner for agricultural produce sold to food corporation of india and state civil supplies corporation - held, respondent's action beyond scope and power under section 12 of act and demand of market fee from petitioner illegal. - - in the said order it was clearly mentioned that the price fixed was exclusive of purchase tax, market fee and cost of new gunny bag. section 12 (2) clearly says that the market fees referred to in section 12 (1) shall be paid by thepurchaser of the notified agricultural produce except where the purchaser cannot be identified......exclusive of purchase tax, market fee and cost of new gunny bag.2. the petitioners delivered the levy rice to the food corporation of india in consultation with the state civil supplies corporation in compliance with the a. p. rice procurement (levy) and restriction and sale order, 1967. the paddy and rice are undisputedly notified agricultural produce, duly notified as items (1) and (2) in g. o. ms. no. 2095 f. a. (ag. iv) dated 29-10-1968. therefore, the market committee is entitled to levy fees under section 12(1) of the act. so the market committee raised a demand against the petitioners for the payment of the market fee on the value of levy rice delivered to the food corporation of india and the a. p. state civil supplies corporation from 7-9-1966 till the date of default. the.....
Judgment:
ORDER

1. The petitioners are all registered traders carrying on business in paddy and rice within the notified market area of the Agricultural Market Committee, Palakole. They have all obtained licences under Section 7 (1) of the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966 (hereinafter referred to as 'the Act') from the Market Committee, Palakole, which is the respondent in this writ petition. The trade in paddy and rice is controlled by the various Control Orders issued under Section 3 of the Essential Commodities Act, 1955 with regard to the sale and purchase. Under the provisions of the A. P. Rice Procurement (Levy) and Restriction on Sale Order, 1967, the petitioners have to deliver the prescribed quantity of rice to the Agent of the State Government at the notified price. Under the A. P. Rice (Procurement Ex-Mill Prices) Order, 1975, issued in G. O. Ms. No. 901 dated 8-10-1975 the price for quintal inclusive of taxes on paddy and exclusive of sales tax and cost of new gunny bag, the price of paddy and rice was fixed. But subsequently by an amendment to the said G. O. issued in G. O. Ms. No. 116, F. and A. dated 24-2-1977, the Government reduced the levy price of rice by Rs. 3/- for each variety. The said amendment was given retrospective effect from 7-9-1976. Later the Government again issued G. O. Ms. No. 734 Food and Agriculture (Civil Supplies) dated 14-10-1977 wherein the price of paddy was fixed. In the said order it was clearly mentioned that the price fixed was exclusive of purchase tax, market fee and cost of new gunny bag.

2. The petitioners delivered the levy rice to the Food Corporation of India in consultation with the State Civil Supplies Corporation in compliance with the A. P. Rice Procurement (Levy) and Restriction and Sale Order, 1967. The paddy and rice are undisputedly notified agricultural produce, duly notified as Items (1) and (2) in G. O. Ms. No. 2095 F. A. (Ag. IV) dated 29-10-1968. Therefore, the Market Committee is entitled to levy fees under Section 12(1) of the Act. So the Market Committee raised a demand against the petitioners for the payment of the market fee on the value of levy rice delivered to the Food Corporation of India and the A. P. State Civil Supplies Corporation from 7-9-1966 till the date of default. The petitioners have now approached this Court invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India to restrain the respondents from levying and collecting the market fee from the petitioners contending that the respondents have no power to do so under Section 12 (2) of the Act.

3. The question that falls for consideration is whether the Market Committee has power under Section 12 (2) of the Act to levy and collect the market fee from the petitioners who are registered traders in paddy and rice.

4. To answer the question it is necessary to read Section 12:

'12. Levy of fees by the Market Committees :--

(1) The Market Committee shall levy tees on any notified agricultural produce, livestock or products of livestock purchased or sold in the notified market areaat such rate, not exceeding one rupee as may be specified in the bye-laws for every hundred rupees of the aggregate amount for which the notified agricultural produce, livestock or products of livestock is purchased or sold, whether for cash or deferred payment or other valuable consideration.

Explanation I :-- For the purposes of this section, all notified agricultural produce, livestock or products of livestock taken out of a notified market area shall unless the contrary is proved, be presumed to have been purchased or sold within such area.

Explanation II :-- In the determination of the amount of fees payable under this Act, fractions of ten paise equal to or exceeding five paise shall be counted as ten paise and other fractions of ten paise shall be disregarded.

(2) The fees referred to in Sub-section. (1) shall be paid by the purchaser of the notified agricultural produce, livestock or products of livestock.

Provided that where the purchaser cannot be identified, the fees shall be paid bythe seller.'

5. It is clear from Section 12 (1) that the Market Committee has power to levy market fee on any notified agricultural produce. It is not disputed that paddy and rice are duly notified agricultural produce, notified under Section 3 of the Act. But the question is whether the said market fee can be collected from the petitioners who are only sellers. Under Sub-section (2) of Section 12 the fee referred to in Sub-section (1) shall be paid by the purchaser of the notified agricultural produce. The seller has to pay market fee only in cases where the purchaser cannot be identified. It is not the contention of the respondents that the purchaser who is the Food Corporation of India or the A. P. State Civil Supplies Corporation cannot be identified. But the learned counsel placed reliance on a memo issued by the Government on 19-1-1977 wherein it was declared that the Ex-Mill price of different varieties of rice includes market fee also, and that the market fee of rice and paddy shall be collected from the millers for the quantities delivered by them towards levy with effect from 7-9-1976. This memo runs contrary to the statute. Section 12 (2) clearly says that the market fees referred to in Section 12 (1) shall be paid by thepurchaser of the notified agricultural produce except where the purchaser cannot be identified. Therefore, in cases where the purchaser can be identified, the market fee should be collected from the purchaser. By the said memo the seller is made liable for the market fee and the Market Committee has raised demand against the seller. The memo violates the statute and is therefore unenforceable. In the circumstances, the demand raised on the basis of the memo for the collection of market fee against the petitioners from 7-9-1976 is illegal and unenforceable. The writ petition is therefore allowed with costs. Advocate's fee Rs. 150/-.


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