1983 (11) TMI 336 - HC - Indian Laws

Court upholds validity of Market Act provision preventing unjust enrichment by licensees, bars refund claims

The court upheld the constitutional validity of Section 23-A of the Punjab Agricultural Produce Markets Act, finding it does not retrospectively validate ... - Issues Involved:1. Constitutional validity of Section 23-A of the Punjab Agricultural Produce Markets Act.2. Bar against the claim of refund of excess market fee.3. Onus of proof regarding the recovery of market fee from next purchasers.4. Legislative power versus judicial power in barring legal remedies for refund.Detailed Analysis:1. Constitutional Validity of Section 23-A:The core question in this judgment is the constitutional validity of Section 23-A, inserted by the Punjab Agricultural Produce Markets (Amendment) Act, 1981. The petitioners challenged this section, arguing that it effectively validates the levy of market fees at Rs. 3/- per hundred, despite the Supreme Court's judgment in Kewal Krishan Puri v. State of Punjab, which upheld the fee only up to Rs. 2/- per hundred. The court, however, held that Section 23-A is not a validation of the market fee at Rs. 3/- but merely a provision to prevent unjust enrichment by licensees who had already recovered the fee from next purchasers. The court emphasized that the provision does not retrospectively validate the excess collection but only bars the refund of such excess fees to licensees who have passed on the burden to next purchasers.2. Bar Against the Claim of Refund of Excess Market Fee:Section 23-A(1) allows Market Committees to retain excess fees collected if the burden was passed to the next purchaser. Sub-section (2) bars any legal proceedings for the refund of such fees, and sub-section (3) presumes the burden was passed on unless proven otherwise by the licensee. The court found this provision justifiable, stating it prevents unjust enrichment of licensees who have already recovered the fees from subsequent purchasers. The court noted that the legislative intent was to ensure that excess fees collected remain with public bodies rather than being refunded to middlemen.3. Onus of Proof Regarding the Recovery of Market Fee from Next Purchasers:The court upheld that the onus of proof lies on the licensees to show that they had not passed on the burden of the excess market fee to the next purchasers. This is in line with Section 106 of the Evidence Act, which places the burden of proof on the person who has special knowledge of the fact. Since licensees have the records of their transactions, it is reasonable to place the burden on them to prove whether they had passed on the fee.4. Legislative Power Versus Judicial Power in Barring Legal Remedies for Refund:The petitioners argued that barring legal remedies for refund and rendering existing decrees or orders unenforceable infringes on judicial powers. The court disagreed, stating that the legislature has the power to amend laws retrospectively or prospectively to remove the basis of a judgment. By creating a bar against the refund of excess market fees, the legislature has validly taken away the substantive right of refund, and consequently, the procedural right to seek such a refund also falls. The court cited the precedent in State of Orissa v. Bhupindra Kumar, affirming that validly abrogating a substantive right does not constitute an intrusion into the judicial domain.Conclusion:The court concluded that Section 23-A and the Punjab Act No. 7 of 1981 do not suffer from constitutional invalidity. The provision is upheld as it prevents unjust enrichment by ensuring that excess market fees remain with Market Committees rather than being refunded to licensees who have already recovered these fees from next purchasers. The individual cases will be considered on their merits by a single Bench.Order:The judgment upholds the constitutional validity of Section 23-A and directs that individual cases be laid before a single Bench for further decision in accordance with this judgment.