A.D. Koshal, J.
1. The petitioner is a dealer in rice carrying on business within, the territorial limits of Alandur Municipality (hereinafter referred to as the Municipality), since the early sixties. In the year 1964, the municipality prescribed a fee of Rs. 30 per year for a licence to carry on business as a dealer in rice. The petitioner took out such a licence in that year and was obtaining one every year thereafter till 31st March, 1972. By a notification dated 27th November, 1971 however, the Municipality enhanced the fee for such a licence from Rs. 30 to Rs. 200 per year with effect from 1st April, 1972 and it is that notification by which the petitioner feels aggrieved and which he seeks to have quashed in this petition under Article 226 of the Constitution of India through the issuance of a writ of certiorari.
2. The sole ground on the basis of which the impugned notification was attacked in the petition was that the licence fee had to be commensurate with the services rendered by the Municipality to the licencees, that the, licence fees realised, by the Committee at the rate of Rs. 30 per-annum in conformity with its 1964 decision more than sufficied for meeting the expenses incurred by the Municipality for rendering services to the licencees and that therefore the enhancement of the fee was liable to be struck down. At the hearing, however, another ground was also raised on behalf of the petitioner and that is based on the provisions of Sub-section (1) of Section 249 of the Tamil Nadu District Municipalities Act (hereinafter referred to as the Act), read with Clause (o) occurring in Schedule V thereto. Those provisions may be reproduced here with advantage:
249 (1) The council may publish a notification in the district gazette and by beat of drum that no place within municipal limits or at a distance within three miles of such limits shall be used for any one or more of the purposes specified in Schedule V without the licence of the executive authority and except in accordance with the conditions specified therein.
Schedule V. Clause (o):
(o) selling wholesale or retail, or storing for wholesale or retail trade or for purposes other than private or domestic use, grain, groundnut, tamarind, chillies, jaggery, pulses, flour, bran, oilcakes or agricultural produce which is likely to attract rats.
The contention of learned Counsel is that rice which is husked paddy is neither grain nor agricultural produce and that therefore no licence is required for dealing in it, no other clause of Schedule V being admittedly applicable to dealings in rice.
Both this contention and the ground taken in the petition appear to me to have force for reasons which follow.
3. In reply to the assertion made by the petitioner that there was no legitimate basis for the increase in the licence fee from Rs. 30 to Rs. 200 per annum, the Municipality, who is the sole respondent before me, states in paragraph 3 of its counter-affidavit:
There was considerable increase in establishment charges and this has warranted enhancement of fees to cover the inspection charges (i.e.) for example1 city compensatory allowance, increase in D.A. by two fold, revision of pay as per the Government Order with effect from 2nd October, 1970, increase in the pay and emoluments and incharges in staff.
The Alandur Municipality is adjacent to the City limits of Madras and Alandur caters to the needs of the whole city population in rice business for the past Several decades. The expenditure under Public Health made during the year 1964-65 and for the year 1971-72 are enclosed to show the increase is expenditure.
It is not shown, and in fact not even asserted, how the expenditure under the head 'Public Health' has any connection with the services rendered to dealers in rice. Apparently, the Municipality cannot charge from licencees such expenses as it incurs in relation to all and sundry. For services rendered to be relevant for the purpose of charging the licence fee, they must have some connection with the purpose for which the licence is granted, but in the in stant case no detail of the expenses, good, bad or indifferent, has at all been placed before the Court to enable it to determine their relevance. Apart therefrom, the income from the licence fees can also be not lost sight of. If the expenses have increased, say ten-fold during the eight years between 1964 and 1972, and the number of licencees has also gone up in the same ratio, no case for increase could be made out, while, on the other hand, if the number of licencees has gone up, say, a hundredfold, there may be a good case for reducing the fees, rather than for increasing it. As it is, the relevant details have not been disclosed and in the absence thereof it is not possible to hold that the increase is justified. It must accordingly beheld, to be illegal.
4. Now I come to the other contention raised in support of the petition and based on the language used in Clause (o) of Schedule V to the Act. In so tar as the word 'grain' occurring in that clause is concerned, the matter is concluded by a Bench decision of this Court in Municipal Council, Tuticorin v. Shanmuga Moopanar I.L.R. (1926) Mad. 219 : 23 L.W. 31 : 51 M.L.J. 62 : A.I.R. 1926 Mad. 251. In holding that the word 'grain' did not include rice or broken-rice, both Spencer J., and Madhayan Nayar, J., who constituted the Bench, relied on a decision of the House of Lords reported in Cotton v. Vogan and Co. (1896) A.C. 457. In that case, the question arose whether maize and oats imported with a view to their being first Subjected to a process of grinding or crushing before sale would be 'grain' brought into the Port of London for sale within the meaning of Section 4 of the Metage on Grain. (Port of London) Act, 1872. By Section 2 of that Act 'grain' is defined to mean:
Corn, pulse and seeds, except the following seeds when brought into the Port of London in sacks or bags, that is to say linseed, rapeseed, millet seed etc.
Answering the question raised in the negative. Lord Herschell observed:
If it (Legislature) had intended to include what had been always regarded and treated as manufactured articles such as flour and meal, as distinguished from the natural products of the earth untreated except by gathering, the language would have been altogether different to that which is to be found in this statute.
Following this process of reasoning Spencer, J., said:
Using similar language, I would say that if the Madras Legislature intended to include in Schedule V(o) rice and broken rice, which have gone through a certain process, as distinguished from the natural products of the earth untreated except the gathering, the storing of which without a licence may be prohibited by any Municipal Council, they would have used more explicit language to denote their meaning. In Clauses (b) and (q) (proviso) the word 'paddy' occurs and in Clause (1) the word 'grain' in Clause (o) is being used in the comprehensive sense of all articles of commerce into which grain can be turned by some process or other. The use of the Tamil word 'dhanyam' in the translation of the notification as the equivalent of 'grain' strengthens the respondent's case. A trader who sells rice may be called a grain-merchant and his merchandise may in a loose sense be called grain, when it includes both grain and rice: but rice is strictly not grain, and the separate entity of the grain by a process of disintegration disappears when they are converted into broken rice.
The observations of Lord Herscbell above quoted were thus dealt with by Madhavan Nayar, J.:
Though the decision was given with reference to the definition of the word 'grain' contained in a special statute, I think the description of the terra 'grain' in Lord Herschell's judgment is sufficiently general and may well be used for the purposes of the present case also. Judged by this test rice which is paddy subjected to the process involving the removal of husk and broken-rice cannot strictly be called 'grain'
Madhavan Nayar, J., proceeded:
Mr. Sitarama Rao for the petitioner invited our attention to the definition, of the word 'grain' contained in Section 456 of the Merchant Shipping Act, 57 and 58 Vict., Chapter 60. That Section defines 'grain' to mean corprice, paddy, pulse, seed, etc. But the section itself makes it clear that this is a special definition applicable to provisions of the part of the Act specially dealing with the 'carriage of Grain Cargo'.... That the Legislature never intended to include 'rice' and 'broken-rice' within the meaning of the term 'grain' appears to be clear from the fact that in the notification in Tamil published by the Municipality in pursuance of the above provisions of the Act, the word (dhanyam) is used as the Tamil equivalent of the English word 'grain'; 'dhanyam' as generally understood in the Tamil language does not mean 'rice' (see Winslow's Dictionary).
I am not only bound by the Bench decision above cited but with the utmost respect agree with it and hold that rice is not 'grain' within the meaning which that word has in Clause (o) of Schedule V to the Act.
Then, can rice be classified as 'agricultural produce'? My answer to this question also is in the negative. The expression 'agricultural produce' has not been defined in the Act and would therefore carry its ordinary meaning in Clause (o), viz., products resulting from agricultural operations alone, or agricultural produce in its ascent or pristine form. In other words, an article which has resulted from agricultural and other operations would not be regarded as 'agricultural produce' even though the parent article of which it was a component and from which it has taken shape through non-agricultural operations was agricultural produce. Thus, wheat and maize in the form of grain are agricultural produce, for they result from agricultural operations and from agricultural operations alone, viz., from cutting of the plants coupled with thrashing and winnowing; but wheat or maize flour cannot be called such produce even though its composition may be exactly the same as that of the grain from which it has resulted. Thus the reasoning of Lord Herschell in Cotton's case (1896) A.G. 457, is as much applicable to the interpretation of the expression 'agricultural produce' as to that of the word 'grain' and that expression as used to Clause (o) must remain limited to natural products of the earth resulting from agriculture and untreated except by gathering. If the scope of the expression is enlarged any further it would embrace not only wheat and maize-flour but also bread and chapathi, etc., i.e., things made from agricultural produce, which obviously could not have been the intention of the Legislature. As already concluded, rice is commodity which results from the husking of paddy, an agricultural produce. Husking is not an agricultural operation but one which is undertaken after the conclusion of agricultural operations on paddy crops. As brought from the farm for sale in the market, such crop does not consist of rice but of paddy grain and the chaff. Rice must therefore be regarded as lying outside the ambit of the expression 'agricultural produce' as used in Clause (o).
5. It is conceded on behalf of the Municipality that if rice cannot be regarded either as 'grain' or as agricultural produce' within the meaning of those expressions as used in Clause (o), the Municipality cannot insist on the petitioner taking out a licence for his dealings in rice. The petition therefore succeeds and is accepted and the impugend notification is quashed. The parties, however, are left to bear their own costs.