Market fee validity sustained where collections funded market services and seller-side collection did not shift the underlying liability.

A market fee levied on bamboo purchases was upheld because the statutory scheme earmarked the collections for regulated market infrastructure, supervision, and allied services benefiting the class of market participants. The governing test was broad, reasonable correlation between the levy and the services rendered, not strict mathematical quid pro quo or individual proof of benefit to each purchaser. The fact that purchasers used the produce as raw material did not negate the fee character of the levy. A proviso requiring the seller to collect the fee in trader-to-trader transactions was only a collection mechanism and did not remove the purchaser's underlying liability to bear the fee.

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Issues: Whether market fee levied by the market committee on purchase of bamboos was invalid on the ground that no direct or indirect benefit was shown to have been conferred on the purchasers as a class, and whether the liability to pay fee was negatived because the seller in a trader-to-trader transaction was required to collect and pay the fee.

Analysis: The statutory scheme under the market legislation created regulated market areas, empowered market committees to levy market fee on notified agricultural produce, and required the proceeds to be utilised for market infrastructure, supervision, regulation, and allied services benefiting the class of buyers and sellers in the market area. The controlling test was not strict mathematical quid pro quo, but a broad, reasonable correlation between the levy and the services rendered. The record disclosed substantial expenditure on market facilities and a reasonable nexus between collections and the services provided. The fact that the purchaser used the produce as raw material, or did not individually use each facility, did not destroy the fee character of the levy. The provision requiring the seller to collect the fee in a commercial transaction between traders was only a mode of collection and did not extinguish the underlying liability of the purchaser to bear the market fee.

Conclusion: The levy of market fee was valid and the purchasers were liable to bear it; the contention that no service was rendered and that the seller-collection proviso barred recovery from the buyer was rejected.

Ratio Decidendi: A market fee remains a valid fee where the legislation earmarks the collections for market-related services and there is a broad, reasonable correlation between the levy and the class-wide benefits or services rendered; the prescribed mode of collection does not alter the incidence of liability.

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