BRITANNIA INDUSTRIES LTD.versusBOMBAY AGRICULTURAL PRODUCE MARKETING COMMITTEE & ANR.

838                      [2019]REPORTS
               SUPREME COURT    1 S.C.R. 838               [2019] 1 S.C.R.


A                      BRITANNIA INDUSTRIES LTD.
                                        v.
           BOMBAY AGRICULTURAL PRODUCE MARKETING
                      COMMITTEE & ANR.
B                        (Civil Appeal No. 1746 of 2010)
                              JANUARY 24, 2019
            [R. BANUMATHI AND R. SUBHASH REDDY, JJ.]

C            Maharashtra Agricultural Produce Marketing (Regulation)
      Act, 1963 – s. 2(1)(a) – “Agricultural Produce” – Products “edible
      oil”, “Vanaspati” and “sugar” – Applicability of the Act – Held:
      Products “edible oil”, “Vanaspati” and “sugar” are agricultural
      produce within the meaning of s.2(1)(a) of the Act.
D           Dismissing the appeals, the Court
            HELD: 1.1 The High Court rightly held that sugar is a
      produce of agriculture coming into being in a processed form
      from sugarcane and the absence of the word “manufacture” in
      the definition of “agricultural produce” under Section 2(1)(a) of
E     the Maharashtra Agricultural Produce Marketing (Regulation)
      Act, 1963 would not in any way affect the status of sugar as being
      an agricultural produce under the Act. [Para 7][841-C]
            1.2 So far as “Vanaspati” is concerned, the High Court
      referred to entire process as to how “Vanaspati” is produced from
F     “edible oils” and that “edible oils” are subject to various processes
      and the end product of all these processes is “Vanaspati”. The
      High Court held that the production of dalda or Vanaspati from
      edible oils is thus the result of the edible oils undergoing all these
      processes which convert edible oils to a new entity called
G     “Vanaspati”. Thus, the High Court concluded that “Vanaspati” is
      nothing but Hydro Generated Refined Edible Oil and is an
      agricultural produce within the meaning of Section 2(1)(a) of the
      Act. The conclusion of the High Court that “edible oil”,
      “Vanaspati” and “sugar” are agricultural produce within the
      meaning of Section 2(1)(a) of the Act is accepted and there is no
H
                                       838
BRITANNIA INDUSTRIES LTD. v. BOMBAY AGRICULTURAL                         839
         PRODUCE MARKETING COMMITTEE

ground warranting interference with the said findings. [Paras 11,        A
13][841-H; 842-A-B, E-F]
      1.3 Section 13(1A)(a) of the Act states that the area
comprising Greater Bombay and Turbhe Village in Thane Taluka
of Thane District or such areas as may be specified by the State
Government by notification in the Official Gazette from time to          B
time, shall be deemed to be a market area called the Bombay
Market Area and respondent No. 1 is the Market Committee for
that area. [Para 15][842-H; 843-A-B]
      1.4 The relevant bills and other documents filed by the
appellant insofar as alleged purchase of sugar from outside the          C
market area (Section 2(1)(i)) shall be considered as expeditiously
as possible. The direction of the High Court in approaching the
concerned Authority is restricted only to sugar. [Paras 18, 19][844-
A-B]
      Champak Lal H. Thakkar v. State of Gujarat (1980) 4                D
      SCC 329 : [1981] 1 SCR 440 – referred to.
                        Case Law Reference
      [1981] 1 SCR 440          referred to             Para 12
                                                                         E
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1746
of 2010.
      From the Judgment and Order dated 16.06.2006 of the High Court
of Judicature at Bombay in Writ Petition No. 1072 of 1991.
                                                                         F
                                WITH
      Civil Appeal No. 1747 of 2010.
       Vikramjit Banerjee, ASG, Jawahar Lal, Vikas Mehta, Adith Nair,
Nishant Sharma, Rakesh K. Sharma, Sarthak Raiza, Ms. Deepa M.
Kulkarni, Nishant Ramakantrao Katneshwarkar,, Advs. for the appearing    G
parties.
      The Judgment of the Court was delivered by
       R. BANUMATHI, J. 1. The issue involved in these appeals is
the interpretation of the term “Agricultural Produce” (Section 2(1)(a)   H
840             SUPREME COURT REPORTS                            [2019] 1 S.C.R.


A     of the Act) contained in the Maharashtra Agricultural Produce Marketing
      (Regulation) Act, 1963.
            2. The appellant filed the writ petition seeking the following
      declarations:

B           (i) The Maharashtra Agricultural Produce Marketing
            (Development) and Regulation Act, 1963 is not applicable to sugar,
            cashew nuts, refined oil, vanaspati and dry fruits purchased by
            the appellant.
            (ii) The notification dated 25.09.1987 is illegal and utra vires to
C           the extent that it adds the above items to the Schedule of the Act.
            (iii) The bulk sugar purchased by the appellant is directly from the
            Sugar mills located outside the market area of the first respondent
            is not covered by the provisions of the Act.

D           3. During the pendency of the writ petition, before the High Court,
      the appellant gave up the challenge in respect of “cashew nuts” and
      other “dry fruits”.
            4. The question falling for consideration in these appeals is whether
      the provisions of the Maharashtra Agricultural Produce Marketing
E     (Regulation) Act, 1963 (Marketing Act) are applicable to the products
      “edible oil”, “Vanaspati” and “sugar”?
             5. We have heard Mr. Jawahar Lal, learned counsel appearing on
      behalf of the appellant as well as Mr. Vikramjit Banerjee, learned Additional
      Solicitor General appearing on behalf of Respondent No. 1 - Agricultural
F     Market Committee.
            6. Section 2(1)(a) of the Maharashtra Agricultural Produce
      Marketing (Regulation) Act, 1963 defines “agricultural produce” as
      under:-

G           2(1). In this Act, unless the context otherwise requires:-
            (a) “agricultural produce” means all produce (whether
            processed or not) of agriculture, horticulture, animal husbandry,
            apiculture, pisciculture and forest specified in the Schedule.

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BRITANNIA INDUSTRIES LTD. v. BOMBAY AGRICULTURAL                              841
 PRODUCE MARKETING COMMITTEE [R. BANUMATHI, J.]

      Section 2(1)(a) of the Maharashtra Agricultural Produce                 A
Marketing (Regulation) Act, 1963 unambiguously shows that the
agricultural produce which are to be covered by the sweep of the Act
necessarily has to be specified in the Schedule.
       7. As pointed out by the High Court, “sugarcane” has been
separately listed under Item VI in the Schedule along with Gul and Sugar      B
and thus the intention of the Legislature is to treat sugar as a produce of
sugarcane, which is a separate agricultural produce. The High Court
rightly held that sugar is a produce of agriculture coming into being in a
processed form from sugarcane and the absence of the word
“manufacture” in the definition of “agricultural produce” under Section       C
2(1)(a) of the Act would not in any way affect the status of sugar as
being an agricultural produce under the Act.
       8. Admittedly, “sugarcane” has been separately listed under Item
VI in the Schedule along with Gul and Sugar and hence, the Committee
has the power of enforcing its statutory right under Section 31 of the        D
Marketing Act to levy market fees on the marketing of sugar in its market
area.
       9. So far as “sugar” is concerned, the High Court rejected the
contention of the appellant by holding that sugar was included in the
Schedule of the Act originally and it came to be deleted from Item VI by      E
a notification dated 13.04.1982 and it is not as if for the first item that
sugar is included in the agricultural produce by notification dated
25.09.1987. After referring various process involved in bringing out the
sugar, the High Court has held that the sugar is an “agricultural produce”
within the meaning of Section 2(1)(a) of the Act. The High Court also
held that the intention of the Legislature is to treat sugar as produce of    F
“sugar cane” as it is added along with other items. The High Court held
that the absence of word “manufacture” would not affect the status of
sugar as being an agricultural produce within the meaning of Section
2(1)(a) of the Act.
                                                                              G
      10. So far as the “edible oil” and the “Vanaspati” are concerned,
the High Court has held that they are agricultural produce within the
meaning of Section 2(1)(a) of the Act.
       11. So far as “Vanaspati” is concerned, the High Court referred
to entire process as to how “Vanaspati” is produced from “edible oils”
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842            SUPREME COURT REPORTS                                [2019] 1 S.C.R.


A     and that “edible oils” are subject to various processes and the end
      product of all these processes is “Vanaspati”. The High Court held
      that the production of dalda or Vanaspati from edible oils is thus the
      result of the edible oils undergoing all these processes which convert
      edible oils to a new entity called “Vanaspati”. Thus, the High Court
      concluded that “Vanaspati” is nothing but Hydro Generated Refined
B
      Edible Oil and is an agricultural produce within the meaning of Section
      2(1)(a) of the Marketing Act.
           12. In Champak Lal H. Thakkar v. State of Gujarat (1980) 4
      SCC 329, this Court held as under:-
C           “11. …..Oil will remain oil if it retains its essential properties and
            merely because it has been subjected to certain processes would
            not convert it into a different substance. In other words, although
            certain additions have been made to and operations carried out on
            oil, it will still be classified as oil unless its essential characteristics
D           have undergone a change so that it would be a misnomer to call it
            oil as understood in ordinary parlance……”
             Relying upon Champak Lal case, the High Court held that oil
      will remain oil even if it has been subject to certain processes and held
      that “edible oil” is an “agricultural produce” within the meaning of
E     Section 2(1)(a) of the Marketing Act.
            13. We fully agree with the conclusion of the High Court that
      “edible oil”, “Vanaspati” and “sugar” would fall within the meaning of
      Section 2(1)(a) of the Marketing Act – agricultural produce. We do not
      find any good ground warranting interference with the findings of the
F     High Court that “edible oil”, “Vanaspati” and “sugar” are agricultural
      produce within the meaning of Section 2(1)(a) of the Marketing Act.
            14. Contention of the appellant is that it procures sugar from the
      sugar mills which are located beyond the limits of the market area of
      respondent No.1 and therefore, the said transactions do not take place
G     within the market area so as to empower respondent No.1 to levy market
      fees under Section 31 of the Act read with Rule 5 of the Rules on the
      sugar produced from outside the market area.
            15. Section 13(1A)(a) of the Act states that the area comprising
      Greater Bombay and Turbhe Village in Thane Taluka of Thane District
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BRITANNIA INDUSTRIES LTD. v. BOMBAY AGRICULTURAL                              843
 PRODUCE MARKETING COMMITTEE [R. BANUMATHI, J.]

or such areas as may be specified by the State Government by notification     A
in the Official Gazette from time to time, shall be deemed to be a market
area called the Bombay Market Area and respondent No. 1 is the Market
Committee for that area.
      16. Insofar as the contention of the appellant that the appellant is
not a buyer within the meaning of Section (2)(1)(ca) as bulk sugar is         B
purchased from outside the market area, the High Court observed:
        “Unless the sugar procurement is done by the petitioner-
      company within the area of Greater Mumbai and Turbhe Village
      of Thane Taluka of Thane District or any other area notified by
      the Government of Maharashtra to be a part of the market area           C
      of respondent No. 1, it cannot levy market fees on sugar. The
      respondent No. 1 has no power to levy market fees under Section
      31 of the Act on the entire quantity of sugar that arrives within its
      market area on the procurement made by the petitioner-company
      and directly from the sugar factories which are located within the      D
      market area of respondent No. 1. It is, therefore, necessary that
      the petitioner-company places before the respondent No. 1 all its
      record to show that sugar was procured/purchased from the places
      outside the market area of respondent No. 1 and if the respondent
      No. 1 on a verification is satisfied, to that extent the respondent
      No. 1 shall have no authority to levy market fees under Section 1       E
      of the Act. This is an issue which will have to be examined by the
      Market Committee afresh and it is imperative for the petitioner-
      company to submit all the records before the respondent No. 1
      for such a verification and this should be done at the earliest
      possible. We have no doubt in our mind that the respondent No.          F
      1- Market Committee shall have powers to levy market fees under
      Section 31 of the Act only on the quantity of sugar that has been
      purchased/procured within its market area and it cannot levy
      market fees on the entire sugar quantity that is received by the
      petitioner-company……...”
                                                                              G
      17. Mr. Vikramjit Banerjee, learned Additional Solicitor General,
submitted that as per direction of the High Court, if the appellant is able
to produce relevant documents, Respondent No. 1 shall consider the
same by passing appropriate orders.

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844                SUPREME COURT REPORTS                       [2019] 1 S.C.R.


A            18. The relevant bills and other documents filed by the appellant
      insofar as alleged purchase of sugar from outside the market area
      (Section 2(1)(i)) shall be considered as expeditiously as possible. It is
      stated by the learned counsel for the appellant that the issue is concerned
      only limited to the period from 01.07.1988 to 03.03.2004.
B           19. We make it clear that the direction of the High Court in
      approaching the concerned Authority is restricted only to sugar.
              20. The appeals are, accordingly, dismissed.


C     Nidhi Jain                                                 Appeals dismissed.




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