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Bombay High Court

AGRICULTURAL PRODUCE MARKET COMMITTEE SHRIGONDAversusDIRECTOR OF MARKETING MAHARASHTRA STATE PUNE AN ORS

Disposal
DISPOSED OFF

Holding

The Director’s power to direct a re‑audit under sub‑rule (7) of Rule 116 of the APMC Rules, 1967 is valid and does not require a prior hearing; the order stands.

Summary

The Agricultural Produce Market Committee (APMC) of Shrignoda challenged an order dated 23 March 2026 by the Director of Marketing, Maharashtra, directing a re‑audit of its accounts for FY 2023‑24 and 2024‑25 under sub‑rule (7) of Rule 116 of the APMC Rules, 1967. The petitioners argued that the order was issued without a hearing, was influenced by political pressure from an MLA, and therefore violated principles of natural justice and Article 227 of the Constitution. The Director’s power to order a re‑audit was defended on the ground that it is an administrative function aimed at preventing loss or misappropriation and is not subject to a hearing requirement. The Court held that the Director’s statutory power is unfettered, the order does not constitute a quasi‑judicial act, and no hearing is mandated before exercising it. Consequently, the petition was dismissed, with the Court noting that any substantive grievances could be raised before the appropriate authority at a later stage.

Issues considered

  • Whether the Director of Marketing, Maharashtra, can direct a re‑audit of an APMC’s accounts without granting a prior hearing under sub‑rule (7) of Rule 116 of the APMC Rules, 1967.
  • Whether the order directing re‑audit is vitiated by alleged political influence and thus violative of Article 227 of the Constitution.
  • Whether the writ petition challenging the re‑audit order is maintainable.

Legislation cited

Subjects

  • re‑audit
  • APMC
  • administrative law
  • Article 227
  • procedural fairness
  • director’s powers
  • agricultural marketing
  • political influence

Judgment

2026:BHC-AUG:18854
                                          (1)                      WP-4194-2026.odt



                     IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                BENCH AT AURANGABAD
                             WRIT PETITION NO.4194 OF 2026
                      AGRICULTURAL PRODUCE MARKET COMMITTEE
                 SHRIGONDA, TQ. SHRIGONDA DIST. AHILYANAGAR AND
                                           ANOTHER
                                            VERSUS
                DIRECTOR OF MARKETING, MAHARASHTRA STATE, PUNE
                                         AND OTHERS
                                               …
               Mr. Mahesh Deshmukh h/f Mr. Umesh B. Gite, Advocate for
               Petitioners
               Mr. S. K. Shirse, AGP for Respondent-State.
               Mr. V. R. Dhorde, Advocate for Respondent No.3.
                                               …
                                        CORAM : S. G. CHAPALGAONKAR, J.
                                        DATED : 28th APRIL, 2026.
               ORDER:-

               1.     The present Writ Petition takes exception to order dated

               23.03.2026 passed by respondent no.1/Director of Marketing,

               Maharashtra State, Pune, thereby directing re-audit of accounts of

               petitioner no.1/APMC for financial year 2023-2024 and 2024-2025

               under provisions of sub-rule (7) of Rule 116 of Maharashtra

               Agricultural Produce Marketing (Development and Regulation)

               Act, 1963 and Rules of 1967 (for short ‘APMC Rules, 1967’).


               2.     The petitioner no.1 is Marketing Committee through its In-

               charge Secretary Rajendra Bajirao Lagad and petitioner no.2 is

               Chairman of petitioner/Market Committee.         One of Director

               namely Sajan Pachpute had made an application under Rule 10(3)

               of APMC (Election) Rules, 2017 before respondent no.2 seeking

               disqualification of petitioner no.2 as Director of APMC.               The
                              (2)                     WP-4194-2026.odt



respondent no.2 was pleased to pass order of disqualification. Now

subject matter is pending before this Court in Writ Petition

No.13646/2025.


3.   According to Mr. Mahesh Deshmukh, learned Advocate

appearing for petitioners, although disqualification order passed

against petitioner no.2 is stayed by this Court, respondent no.3

initiated another proceeding before respondent no.1/Director of

Marketing for change of Special Auditor and re-audit of petitioner

no.1 on very same issues, which were subject matter of

disqualification proceeding against petitioner no.2. The respondent

no.1/Director of Marketing served notice of hearing to petitioners

on application filed by respondent no.3 seeking re-audit of

petitioner no.1. However, without giving sufficient opportunity of

hearing to petitioners, impugned order directing re-audit of

petitioner/APMC for the year 2023-2024 and 2024-2025 has been

passed.   Mr. Deshmukh would invite attention of this Court to

communications issued by MLA, which according to him depicts

political intentions behind passing impugned order.


4.   Per Contra, Mr. Dhorde, learned Advocate appearing for

respondent no.3, supports impugned order.


5.   Having      considered    submissions   advanced    by     learned

Advocates appearing for respective parties, it can be observed that
                            (3)                      WP-4194-2026.odt



impugned order has been passed by respondent no.1/Director of

Marketing in exercise of powers under Sub-rule (7) of Rule 116 of

APMC Rules, 1967.        Undisputedly, Director is vested with

sufficient power to direct re-audit, if he is satisfied that it is

necessary or expedient. Rule 116 of APMC Rules, 1967 provides

that every Market Committee shall maintain account books and

same shall be audited annually by Auditors of Co-operative

Department.     The Auditor is under obligation to report to

Committee and Director or officer authorized by him, any material

defect or irregularity observed by him in accounts of Committee.

The powers of the Director to direct re-audit are not circumscribed

by any express restriction. It depends on his subjective satisfaction

as to requirement of such exercise.


6.    Prima facie, this court finds that Director has administrative

control over functioning of APMC and Sub-rule (7) of Rule 116 of

APMC Rules, 1967 is aimed to supervise over accounts and

expenditures of committee with a view to avoid loss, waste or

misappropriation of money or property owned by or vested in

Committee. This court does not find provision requiring grant of

opportunity of hearing to Market Committee before exercise of

powers conferred under Sub-rule (7) of Rule 116 of APMC Rules,

1967. Such powers are purely administrative in nature. Neither

Director exercises quasi judicial power nor does he adjudicate any
                               (4)                       WP-4194-2026.odt



issue while passing order of re-audit. The re-audit does not cause

direct prejudice to APMC. This Court do not find any reason to

entertain writ petition against such order under Article 227 of

Constitution of India.


7.       In present case, it is contention of petitioners that respondent

no.1 has exercised powers on extraneous or political influence

because only one MLA demanded re-audit. However, this Court

cannot countenance with such contention.               The reliance of

petitioners on observations of Supreme Court in case of State of

Madhya Pradesh and Others Vs. Sanjay Nagayach and

Others1 appears to be misplaced. In facts of this case, this Court

do not find any reason to interfere in impugned order. Needless to

state here that, all points on merit are kept open for agitation

before appropriate authority at appropriate stage.


8.       In result, Writ Petition stands rejected.



                                         (S. G. CHAPALGAONKAR)
                                                  JUDGE
Devendra/April-2026




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