1990 (3) TMI 323 - SC - VAT and Sales Tax

Validity of Rajasthan Agricultural Markets Act challenged in court

Kishan Lal And Ors Versus State Of Rajasthan & Ors

The challenge to the Rajasthan Agricultural Produce Markets Act, 1961, based on legislative competence, constitutional violations, and inclusion of ... Validity of Rajasthan Agricultural Produce Markets Act, 1961 - levying market-fee on sale and purchase of agricultural produce in market-yard or sub-market yard was challenged by dealers for lack of legislative competence - violation of Articles 14, 19, 301 and 304 of Constitution, absence of any quid pro quo in the fee paid and service rendered, illegal and arbitrary inclusion of manufactured articles such as Khandsari, Shakkar, Gur and Sugar as agricultural produce in the schedule etc. Held that:- Appeal dismissed. All 'Acts and the notifications issued thereunder by the Centre in regard to sugar and sugarcane were enacted in exercise of concurrent jurisdiction'. Effect of it was described thus, 'The Provincial Legislature as well as the Central Legislature would be competent to enact such pieces of legislation and no question of legislative competence would arise'. Issues:Challenge to the validity of Rajasthan Agricultural Produce Markets Act, 1961, on grounds of legislative competence, violation of constitutional articles, lack of quid pro quo, and inclusion of manufactured articles as agricultural produce.Analysis:The judgment delivered by R.M. Sahai, J., addressed the challenge to the Rajasthan Agricultural Produce Markets Act, 1961 (the Act) in Writ Petition No. 1555 of 1979. The Act's imposition of market fee on the sale and purchase of agricultural produce was contested by dealers on various grounds. The petitioners argued lack of legislative competence, violation of Articles 14, 19, 30 1, and 304 of the Constitution, absence of quid pro quo, and the arbitrary inclusion of manufactured articles like Khandsari, Shakkar, Gur, and Sugar in the schedule of agricultural produce.The petitioners also questioned the Acts of other states, such as Punjab, Haryana, and U.P., for similar issues. Despite previous decisions setting principles for the validity of marketing legislations, the petitioners persisted in their challenge, particularly focusing on the inclusion of sugar in the Act's schedule. They argued that sugar, being a commodity of public importance under Entry 52 of List I of Schedule VII, should not have been legislated upon by the State. However, the Court found that the Act empowered the State Government to amend or include items in the schedule, and such delegated power was not illegal. The definition of 'agricultural produce' in the Act was inclusive and not limited to items produced from the soil, encompassing various types of produce.The judgment highlighted that the Act's definition of agricultural produce included items from horticulture, animal husbandry, and other specified categories. The Court referenced judicial interpretations from other states and international sources to support the broad interpretation of agricultural produce. Challenges regarding the State's authority to legislate on sugar and arguments of an occupied legislative field were deemed academic, with historical precedence establishing the competence of both Central and State legislatures in enacting sugar-related legislation.In conclusion, the Court dismissed the petitions, emphasizing the absence of repugnancy between Central and State legislation and the Act's protection under Article 254(2) due to receiving the President's assent. The petitions were therefore dismissed with costs, upholding the validity of the Rajasthan Agricultural Produce Markets Act, 1961.