TaxTMI 
TaxTMI 
2002 (3) TMI 708
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....ultural Produce Marketing (Regulation) Act, 1966 (for short "the Marketing Act"). 3.. Writ petitions were filed, inter alia, on the grounds as to whether the sale of rice by the rice millers to the State Government or its agents by virtue of the Karnataka Rice Procurement (Levy) Order, 1984 (for short "the Control Order") is a sale for the purpose of section 65 of the Marketing Act, when once paddy is subjected to levy of market fee, whether on sale of rice, market fee could be levied; whether the rice which is a processing commodity from paddy could be subjected to market fee; and as to whether the provisions of the Marketing Act were repugnant to the Control Order framed under the Essential Commodities Act, 1955. The single Judge allowed the writ petitions, aggrieved against which the State of Karnataka filed writ appeals. A few writ petitions which were filed after the admission of the writ appeals were ordered to be clubbed with the writ appeals. The writ appeals and the writ petitions were thereafter taken up together and disposed of by passing a common order. Before the division Bench counsel for the parties addressed arguments on the following points: (1) Whether sale of r....
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....e Marketing Act was not applicable in regulating the sale and purchase of transactions concerning rice in view of the Control Order. To fortify the submission reliance was placed on section 6 of the Essential Commodities Act which provides that any Order made under section 3 of the Essential Commodities Act, 1955 would have effect notwithstanding anything inconsistent contained in any other enactment. The same reads as: "6. Effect of orders inconsistent with other enactments.-Any Order made under section 3 shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than this Act or any instrument having effect by virtue of any enactment other than this Act." 8.. As against this the counsel for the respondents contended that no parallel could be drawn on the facts of this case with the sale and purchase of transactions concerning sugarcane, sugar and molasses in Belsund Sugar Co. Ltd. case (1999) 9 SCC 620. That in the said case the Constitution Bench was dealing with the legality of levy of market fee under the provisions of the Bihar Agricultural Produce Markets Act, 1960, pertaining to different commodities, i.e., sugarcane, sugar, and mol....
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....Order, 1966 both issued under section 3 of the Essential Commodities Act, 1955. It was held that the Bihar Agricultural Produce Markets Act, 1960, had been enacted by the Bihar Legislature as per the legislative powers vested in it by entries 26, 27 and 28 of List II of the Seventh Schedule to the Constitution, which read as under: "26. Trade and commerce within the State subject to the provisions of entry 33 of List III. 27.. Production, supply and distribution of goods subject to the provisions of entry 33 of List III. 28.. Markets and fairs." 10.. That if location of markets and fairs simpliciter and the management and maintenance only were contemplated by the Bihar Agricultural Produce Markets Act, 1960, then they would fall within the topic of legislative power envisaged by entry 28 of List II. But since the Bihar Agricultural Produce Markets Act, 1960 dealt with supply and distribution of goods as well as trade and commerce therein to regulate the sale and purchase of agricultural produce to be carried on in the specified markets under the Act, to that extent the provisions of entry 33 of List III would override the legislative powers of the State Legislature in connectio....
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....The aforesaid provisions, therefore, clearly indicate that the need for regulating the purchase, sale, storage and processing of sugarcane, being an 'agricultural produce', is completely met by the comprehensive machinery provided by the Sugarcane Act enacted by the very same Legislature which enacted the general Act being the Market Act." 13.. After reaching this conclusion on the provisions of the Bihar Sugarcane (Regulation of Supply and Purchase) Act, 1981, it was observed in paragraph 48, as under: "Once that conclusion is reached it becomes obvious that the Market Act which is an enabling Act empowering the State authorities to extend the regulatory net of the said Act to notified agricultural produce as per section 3(1) will get its general sweep curtailed to the extent the special Act being the Sugarcane Act enacted by the very same Legislature carves out a special field and provides special machinery for regulating the purchase and sale of the specified 'agricultural produce', namely sugarcane." 14.. By a notification issued under section 42 of the Bihar Agricultural Produce Markets Act, 1960, the State of Bihar exempted all sugar mills from the provisions of the Bihar ....
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....e any need for regulating the purchase, sale as well as storage of sugarcane in the market area concerned. The wide sweep of the general notification of section 3 of the Market Act, therefore, will have to be read down by excluding from its general sweep sugarcane and its products as the definition of 'agricultural produce' as noted earlier would otherwise include not only the primary produce of agriculture but also any other commodity processed or manufactured out of such primary agricultural produce. That is precisely the reason why the State of Bihar having realised the futility of the need about controlling and regulating the sale and purchase of sugarcane in the market area by the sugar factories excluded the operation of section 15 of the Act, which noted earlier, is the soul of the Act. It is easy to visualise that if transactions concerning an 'agricultural produce' are excluded from the operation of section 15 of the Act, the entire machinery available to the Market Committee to regulate such transactions would get out of the picture and there would be no room for the Market Committee to supply any infrastructural facility or other benefits to the seller of such agricultur....
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.... to the State Government or the purchase agent was required to be delivered by the miller to purchase agent or to such other persons as may be authorised by the State Government or the purchase agent to take such delivery. No stock of rice is to be removed from the mill premises without delivery of the rice to the State Government or its agents to the extent of 33 1/3 per cent of the total production and obtaining a release certificate. Clause 7 provides that delivery of rice is to be made by the miller to the State Government or the purchase agent as the case may be in such lots, in such manner, at such place and at such time as per the directions of the State Government or the purchase agent. This Order does not enact a special machinery covering the entire field regulating the marketing, sale and purchase of rice as was done in the case of sugarcane by the Bihar Sugarcane (Regulation of Supply and Purchase) Act, 1981 or the four Orders framed under section 3 of the Essential Commodities Act pertaining to sugar. A notification similar to the one issued by the State of Bihar exempting the millers from the provisions similar to the provisions of section 15 of the Bihar Agricultura....