Holding

Gur‑lauta, raskat, rab‑galawat and rab‑salawat are agricultural produce within the meaning of Section 2(a) and are liable to market fee.

Summary

The Supreme Court examined whether gur‑lauta, raskat, rab‑galawat and rab‑salawat—inferior forms of gur and rab derived from sugarcane or molasses—constitute "agricultural produce" under Section 2(a) of the Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964 and are therefore liable to market fee. The High Court Full Bench had held they were not agricultural produce. The Court interpreted the definition, noting that the statute uses "means" and "includes" and expressly adds gur, rab, shakkar, khandsari and jaggery, and that it also covers items in processed form. It concluded that the inferior products are merely processed forms of the listed items and fall within the definition, making them subject to market fee. Consequently, the Supreme Court set aside the High Court judgments and allowed the appeals.

Issues considered

Do gur‑lauta, raskat, rab‑galawat and rab‑salawat qualify as "agricultural produce" under Section 2(a) of the U.P. Krishi Utpadan Mandi Adhiniyam, 1964?
Are these products liable to the levy of market fee under the same provision?

Legislation cited

Subjects

agricultural producemarket feedefinitionprocessed formgurrabmolassesUttar Pradeshstatutory interpretationincludes

Judgment

KRISHI UTPADAN MANDI SAMIT! AND ANR. ETC. A
v.
SHANKAR INDUSTRIES AND ORS. ETC

FEBRUARY 11, 1993

[N.M. KASLIWAL AND YOGESHWAR DAYAL, JJ.] B

U.P. Krishi Utpadan Mandi Adhiniyam, 1964 :

Section 2(a) 'Agricultural produce'-Levy of market fee-Gur lauta,
~- raskat, rob galawat, rab salawat-fleld exigible to market fee.
c
Section 2 (a) of the U.P. Krishi Utpadan Mandi Adhiniyam of 1964

- defined 'agricultnral produce'. The words 'gur, rab, shakkar, Khandasari
andjaggery', were added in the said definition by U.P. Act No.10of1970.

A Division Bench of the Allahabad High Court referred the question D
whether gur-lauta and raskat and rab-salawat are liable to the levy of
)r market fee under the U.P. Krishi Utpadan Mandi Adhiniyam of 1964 to a
Full Bench. The Full Bench held that gur-lauta and raskat and rab-
galawat and salawat were not an 'agrcultural produce' within the menaing
of the Act, and other Benches followed the Full Bench.
E
In the appeals to this Court, it was contended on behalf of the
·y appellants that when gur, 1I .khandsari and shakkar have been added in
the definition of 'agricultural produce' rah- galawat or rab-salawat being
the inferior forms of the rab are necessary .an agriculatural produced

- within the definition of agricultural produce. On behalf of the respondents
it was contended that the Full Bench was right in taking the view that
molasses are a different product which looses its original character and
F

being a residual article after solidification of the natural article i.e.,
~sugarcane juice, it cannot be said to be an agritultural prQd,uce, that
molasses itself being not an agriculetural produce, gur lauta a_nd raskat
prepared from molasses cannot be held to be an agricultural produce. G
Allowing the appeals, this Court,

HELD : 1. A persual of the definition of 'agricult!lral produce' under
> Section 2 (a) of the Act shows that apart from items of produce of
agric.ultre, horitculture, viticulture, apiculture, sericulture, pisciculture, H
1037
1038 SUPREME CQURT REPORTS [1993] 1 S.C.R.

A animal husbandry or forest as are specified in the Schedule, the definition
further 'includes admixture of two or more such items' and thereafter it
further 'includes taking any .such item in processed from' and again for
the third time the words used are 'and further includes gur, rab, shak..'<ar,
khandsari and jaggecy'. [1041C) .

B 2. It is a well settled rule of interpretation that where the legislature
used the words· tmeans' and 'includes' suctt definition is to be given a wider
meaning and is not exhaustive or restricted to the items contained or
included in such definition. [1041D) ~

C 3. The meaning of 'agricultural produce' in the above definition is
not restricted to any products of agriculture as specified in the Schedule
but also includes such ifellJS which come into being in processed form and
further includes such items which are called as gur, rah, shakkar,
khandsari and jaggery. [1041E] ·
-
D 4. Gur·lauta or raskat and rab-salawat made from sugarcane or
from molasses shall fall within the definition of 'agricultural produce' l\5
contained in Section 2(a) of the Uttar Pradesh Krishi Utpadan Mandi
Adhiniyam, and are exigible to market fee. The view taken by the Full
Bench of the High Court is not correct. [1042C, 1043D]
E
Rathi Khandsari Udyogetc. v. State of U.P. & Ors. etc., [1985] 2 S.C.R. y
966; Kishan Lal and Ors. v. State of Rajasthan & Ors., [1990] 2 S.C.R. 142;
and Bharat Trading v. State of U.P. & Ors., WP (C) No. 9982 decided on
31st March, 1992, referred to. -

F CIVIL APPELLATE JURISDICTION : Civil Appeal No. 3111-16
of 1991.

From the Judgment and Order dated 2.4.90 of the Allahabad High
Court in W.P. No. 5627, 6163/88, 1193, 8415, 10360/89 and 1076 of 1990.
G WITH

Civil Appeal Nos. 580 to 606 of 1993 & 4416 of 1991

E.C. Agrawala, Anant V. Palli, Atual Sharma, Mrs. Purnima Bhat
H .Kak, Mrs. Rckha Palli and Pradcep Misra for the Appellants.
KRJSHI UTPADAN SAMITI v. SHANKAR IND. [KASL!WAL, J.] 1039

C.S. Vaidyanathan, R.K. Jain, Ms. Bharti Sharma, Mrs. Rani A.·
)\" Chhabra, KB. Rohtagi and Ms. Aparna Rohtagi for the Respondents.

The Judgment of he Court was delivered by

KASLIWAL, J. Computer Code No. 12964 of 1991.
B
·(In S.L.P. (C) No. _ _ _ of 1991)

Delinked. See separate Order in the concerned file. Special Leave
granted in all the other petitions. In all the above appeals the short
controversy raised is whether gur-lauta. and raskat and rab-galawat and

- rab-salawat are liable to the levy of market fee under the U.P. Krishi
·Utpadan Mandi Adhiniyam of 1964 (hereinafter referred to as 'the Act').
C

A Division Bench of the Allahabad High Coart referred the question
for being considered by a Full Bench. The Full Bench of the High Court
by decision dated 2.4.1990 held that gur-lauta and raskat and rab-galawat D
and salawat were not an agricultural produce within the meaning of the
Act. Subsequently other Benches followed the aforesaid decision of the
Full Bench. All the above appeals by grant of Special Leave are directed
against the Judgment of the Full Bench dated 2.4.1990 as well as the
subsequent decisions following the Full Bench case.
E
Section 2(a) of the Act defines 'agricultural produce' and reads as
under:-
- "2(a) 'agricultural produce' means such items of produce
of agriculture, horticulture, viticuJature, apiculture, sericul-
ture, pisciculture, animal husbandry, or forest as are F
specified in the Schedule and includes admixture of two or
more of such items, and also includes any such item in
processed form, and further includes gur, rub, shakkar,
khandsari and jaggery".

It may be mentioned that the words gur, rah, shakkar, khandsari and G
jaggery were added in the above definition of agricultural produce by U.P.
Act No.10 of 1970. To decide the controversy raised in these cases the
definition of agricultural produce has to be taken into consideration after
the words added by the aforesaid U.P. Act No.10 of 1970. Sugarcane is an
agricultural produce out of which juice is extracted. The said juice gets H
1040 SUPREME COURT REPORTS [1993] 1 S.C.R.

A thickened by dehydration and when it reaches a particular pigment, it takes
the form of rab which is a semi solid form of the sugarcane juice. After the
process of boiling this rab is put in a crystaliser where it is allowed to get
cooled and crystals are formed when the same is rotated in the crystaliser.
The crystalised rab is then put into centrifugal machines in which through
the process of infusion of sulphur, the sugarcane juice is cleaned and
B whitened.

The rab which is not put into the centrifugal machine but is
dehydrated and is allowed to be hardened by the open pan process takes
the shape of gur which is normally used for home consumption.
c The rab which is not allowed to be hardened is also sold in semi solid
form but those persons who desire to make further profits put the rab into
centrifugal machines and by the process of infusion of sulphur they obtain
khandsari in the dry powder/crystalisi;d form and the waste of rab which
is obtained in the liquid form is known as molasses. ~
D
The residue which is known as molasses is further ulitised by many
people by boiling in the open pans and the same is again re-processed by
cleaning and dehydrating and later by sulphitation is taken in powder form.
This first process out of molasses of rab in the semi solid form is also sold
in the market because this inferior quality contains less content of sucrose
E ..,...
and is called. rab-galawat. Rab-salawat is also prepared by the same process
out of the molasses and is further inferior quality of rab. It has been
, contended on behalf of the appellants that rab-galawat and rab-salawat are
thus nothing but different forms of rab although a little and/or more
inferior in quality. It has been contended that the main ingredient being
F sugarcane out of which juice is extracted and when gur, rab, khandsari and
shakkar have been added in the definition of agricultural produce, the
rab-galawat or rab-salawat being the inferior forms of rab are necessarily
an agricultural produce within the above definition of agricultural produce.

G It has also been submitted that so far as gur-lauta or other forms of
gur like kala-gur, gur-budha etc., are also prepared from the molasses by
re-boiling the molasses in the open pans which is allowed to thicken after
dehydration in the boiling pans. Thus it has been submitted that gur-lauta '""·
or gur-raskat is nothing else except inferior form of gur.

H On the othe· hand it has been contended on behalf of the respon-
KRISHI UTPADAN SAMIT! v. SHANKAR IND. [KASLIWAL, J.] 1041

dents that the Full Bench of the High Court was right in taking the view A
Y that molasses are a different product which looses its original character
and being a residual a;ticle after solidification of the natural article i.e.,
sugarcane juice, it cannot be said to be an agricultural produce. It has been
contended that molasses itself being not an agricultural produce, gur-lauta
and raskat prepared from molasses cannot be held to be an agricultural
B
produce.

;'( We have considered the arguments advanced on behalf of the parties
and have perused the record. A perusal of the definition of agricultural
produce under Section 2(a) of the Act shows that apart from items of

- produce of agriculture, horticulture, viticulture, apiculture, sericulture,
pisciculture, animal husbandry or forest as are specified in the Schedule
the definition further 'includes admixture of two or more such items and
c

thereafter it further 'includes taking any such item in processed form and
y again for the third time the words used are 'and further includes gur, rab,
shakkar, khandsari and jaggery'. It is a well settled rule of interpretation D
that where the legislature uses the words 'means' and 'includes' sucn
definition is to be given a wider meaning and is not exhaustive or restricted
to the items contained or included in such definition. Thus the meaning of
'agricultural produce' in the above definition is not restricted to any
products of agriculture as specified in the Schedule but also includes such
"{ items which come into being in processed form and further includes such E
items which are called as gur, rab, shakkar, khandsari and jaggery.

If we look the matter from another angle, U.P. Krishi Utpadan
Adhiniyam is a beneficial legislation both for the agriculturists as well as
the traders. It provides for collecting market fee by the mandi samities from F
_...(__the agricultural produce brought for sale and purchase in the market areas.
We find no ground or justification to take the view that the legislature
though intended to levy market fee by mandi samities on gur and rah but
may have had no intention of charging of market fee on inferior qualities
of gur called as gur-lauta or raskat and similarly of inferior qualities of rab
called rab-galawat and rab-salawat. We do not find any good reason to take G
the view, as contended on behalf of the respondents, that the gur-lauta or
.>-- .
raskat being prepared from the molasses as such these items should not be
considered as agricultural produce. It cannot be denied that molasses is a
syrup drained from the sugarcane juice in the process of manufacturing
sugar. Similarly rab is also a product prepared in the ·same process and H
1042 SUPREME COURT REPORTS [1993] 1 S.C.R.

A rab-salawat and galawat are inferior forms of rab.

It has been contended on behalf of the respondents that gur-lauta or
raskat is not fit for human consumption and the same is utilised for animal
consumption as such cannot fall within the definition of gur. Even if for
arguments sake it may be admitted that the aforementioned inferior quality
B of gur is not fit for hun1an consumption and is utilised for animal consump·
tion, we do not see any reason to hold that on account of such use or
consumption the item cannot be held as an agricUltural produce within the ~
meaning of its definition in Section 2(a) of the Act. Thus in our view all
kinds of rah and gur made from sugarcane or from molasses shall fall
C within the definition of rah and gur as contained in Section 2 (a) of the
Act.

In Rathi Khandsari Udyog etc. v. State of U.P. & Ors etc., [1985] 2
S.C.R. 966 this court while considering the definition of khandsari under·~
D Section 2 (a) of the Act held as under :-

"The Legislature has in terms encompassed 'Khandsari'
within the definition of Section 2(a) of the Act. And the
term 'Khandsari' is sufficiently wide to cover all varieties
of khandsari including the article produced by the factories
E like those of the petitioners. Besides the basic premise
assumed by the petitioners that the object of the Act is
merely to protect the producers from exploitation is falla-
cious. Of course one of the main objecis of the Act is to
protect the producers from being cheated by unscrupulous
F traders in the maiter of price, weight, payment, unlawful
market charges etc. and to render them immune from
·exploitation as indicated by the 'prefatory note' and by the
provisions contained in Section 16(i), (ii), (iii), (iv), (viii)
etc. While this is one of the objects of the Act, it is not the
sole or only object of the Act. The Act has many more
G objects and a much wider perspective such as development
of new market areas, efficient collection of data, and
processing of arrivals in Mandis with a view to enable the
World Bank to give substantial economic assistance to
,. establish various markets in Uttar Pradesh as also protec-
H tion of consumers and even traders from being exploited
KRJM-11 UT!' ADAN 'AMIT! '" SHANKAR IND. fKASLIWAL, J.j 1043

in the matter of quality, weight and price". A
In Kishan Lal and 01s. v. State of Rajasthan & Ors., [1990] 2 S.C.R.
142 it was held as under:

"The definition of the word "agricultural produce" in the
Act includes all produce whether agricultural, horticul- B
tural, animal husbandry or otherwise as specified in the
Schedule. The legislative power to add or include and
define a word even artificially, apart, the definition which
is not exhaustive but inclusive, neither excludes any item
produced .in mill or factories nor it confines its width to
c
- produce from soil. Nor switch over from indigenous
method of producing anything to scientific or mechanical
method changes its character. To say, therefore, that sugar

.,...
.
being produced in mill or factories could not be deemed
to be agricultural produce is both against the statutory
language and judicial interpretation of similar provisions D
of the Act in statutes of other States".

In Bharat Trading v. Stale of U.P. & Ors., Writ Petition (Civil) No.
99~2 of 1983 decided on 31st March, 1992 it was held that 'raskat' is nothing
more than an inferior quality of gur and the same was held as an agricul-
tural produce within the meaning of Section 2(a) of the Act. E

- Thus we hold that gur - lauta or raskat and rab-galawat and rab -
salawat fall within the definition of 'agricultural produce' as contained in
Section 2(a) of the Act and are cxigiblc to market fee under the Act and
the view taken by the Full Bench of the High Court is not correct. In the
F
result we allow all these appeals. set aside the impugned judgments of the
High Court and as a result of which the writ petitions filed hy the respon-
dents stand dismissed. No order as to costs.

N.VK Appeals allowed.