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of <h1>Supreme Court exempts paper company from market fee for manufacturing agricultural produce</h1> The Supreme Court allowed the appeal, ruling that the appellant, a paper manufacturing company, was not liable to pay market fee under the M.P. Krishi ... Whether a particular activity amounts to 'manufacture' or not? Held that:- Appeal allowed. Had it been only that the goods notified are brought into the market area to be covered by the second category then the stand of the respondents would have been acceptable. But the further condition it must be 'used for processing' shows that the emphasis is on end-user. In this case that makes the difference. Therefore, the appellant is correct in its stand that levy on the notified agricultural produce being brought within market area where end-user is manufacture does not attract levy of market fee. Issues Involved:1. Whether the appellant is liable to pay market fee under the M.P. Krishi Upaj Mandi Adhiniyam, 1972.2. Interpretation of 'processing' and 'manufacturing' under the Act.3. Applicability of market fee on agricultural produce brought into the market area for manufacturing purposes.Issue-wise Detailed Analysis:1. Liability to Pay Market Fee:The appellant filed a writ petition under Article 226 of the Constitution before the Madhya Pradesh High Court, challenging the demand for market fee under the M.P. Krishi Upaj Mandi Adhiniyam, 1972. The appellant, a public limited company with a paper manufacturing plant, argued that it should not pay market fee for agricultural produce brought from outside the State for use as raw materials. The High Court upheld the State's and market committee's stand, dismissing the writ petition.2. Interpretation of 'Processing' and 'Manufacturing':The appellant contended that the notified agricultural produce brought into the market area is not used for processing but for manufacturing, and hence, should not attract market fee. The respondents argued that the manufacturing process involves processing, thereby justifying the levy. The Supreme Court examined definitions and distinctions between 'processing' and 'manufacturing' as per various legal precedents and dictionaries. It was noted that 'processing' involves treatment to agricultural produce before final consumption, while 'manufacturing' implies transformation into a new commodity.3. Applicability of Market Fee:Section 19 of the Act empowers the market committee to levy market fee on the sale or processing of notified agricultural produce brought into the market area. The Supreme Court emphasized that both conditions-bringing the produce into the market area and using it for processing-must be met for the levy to apply. The Court concluded that since the appellant uses the produce for manufacturing, not processing, the levy does not apply. The Court stated, 'the appellant is correct in its stand that levy on the notified agricultural produce being brought within market area where end-user is manufacture does not attract levy of market fee.'Conclusion:The appeal was allowed, and the Supreme Court directed that no market fee is payable by the appellant for the agricultural produce brought into the market area for manufacturing. The transfer petition was disposed of accordingly.
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