Supreme Court of India
M/S. DHARAMPAL SATYAPAL LTD. AND ANOTHERversusSTATE OF BIHAR AND ORS.
- Citation
- 2008 INSC 663
- Decided
- 14 May 2008
- Disposal
- Disposed off
- Bench
- S B SINHA
Holding
The Supreme Court set aside the High Court's judgment and remitted the matter for fresh consideration, noting that the High Court had failed to address the crucial questions raised by the parties.
Summary
The appellants, manufacturers of Zafrani Zarda, challenged the levy of market fee imposed by the State of Bihar under the Bihar Agricultural Produce Market Act, 1960. They argued that Zafrani Zarda, a manufactured form of tobacco, should not be subject to the fee or that the notifications authorising the levy were ultra vires the Act. The High Court had held that the fee was payable from 31 August 1992, without addressing the appellants' contentions regarding the amendment of the definition of "agricultural produce" and the applicability of sections 3, 4 and 4A of the Act. The Supreme Court found that the High Court failed to consider these significant questions and set aside its judgment. The matter was remitted to the Patna High Court for fresh consideration, with a direction to decide the issues expeditiously.
Issues considered
- Whether the levy of market fee on Zafrani Zarda is valid under the Bihar Agricultural Produce Market Act, 1960.
- Whether the notifications issued by the State Government are ultra vires the Act and therefore inapplicable to Zafrani Zarda.
- Whether sections 3, 4 and 4A of the Act are required to be complied with in relation to Zafrani Zarda.
- From which date, if any, the market fee should be levied on Zafrani Zarda.
Legislation cited
- Constitution of Indias. 226
Subjects
market feeagricultural produceZafrani ZardaBihar Agricultural Produce Market Actultra vireswrit petitionSection 226legislative amendmentschedule of the Act
Judgment
[2008] 8 S.C.R. 621
~
M/S. DHARAMPAL SATYAPAL LTD. AND ANOTHER A
v
STATE OF BIHAR AND ORS.
(Civil Appeal No. 5779 Of 2005)
MAY 14, 2008
B
[S.B. SINHA AND LOKESHWAR SINGH PANTA, JJ.]
+
Constitution of India, 1950 - Art. 226 - Dispute over levy
of market fee on Zafrani Zarda, a manufactured form of tobacco
- Writ petition - High Court disposed of same without consider- c
ing significant questions raised by the parties - Hence, matter
remitted back to High Court for decision afresh - Bihar Agricul-
tural Produce Market Act, 1960 - ss.3,4 and 4A.
Dispute arose as regards the validity of levy of mar-
-+ ket fee on Zafrani Zarda, a manufactured form of tobacco, D
in terms of the provisions of the Bihar Agricultural Pro-
duce Market Act, 1960.
The definition of 'agricultural produce' underwent a
change so as to include the 'manufactured goods' there-
from by way of amendment on 30th April, 1982. Again with E
effect from 30th April, 1982, Zafrani Zarda was inserted in
the Schedule appended to the said Act, by reason of a
Notification dated 31st July, 1991, issued by the State of
...._
Bihar. The State Government issued another Notification
being S.O. 220 dated 31st August, 1992 for regulation of F
sale, purchase, storage and process of all agricultural pro-
duce mentioned in the Schedule of the Act in the areas
covering 122 market committees including the Respon-
dent Market Committee.
G
Questioning the orders of assessment of market fee
relying on and on the basis of the said G.Os., by the As-
sessing Authority, Appellants filed writ petitions before the
High Court. In the said writ petitions, inter alia it was con-
621 H
622 SUPREME COURT REPORTS (2008] 8 S.C.R.
~
A tended that the market fee be assessed from the date of
coming into force of the Amendment i.e. 30th April, 1982
from which date the definition of 'agricultural produce' had
been amended. The High Court held that the market fee
would be leviable with effect from 31st August, '1992.
8 Hence the present appeal.
Remitting the matter to High Court, the Court
+
HELD: 1. The High Court failed to take into consid-
eration the important question raised by the petitioners
c that the Notifications were ultra vires the Act and/or would
have no application in relation to Zafrani Zarda. It also did
not take into consideration the contention of the Market
Committee that having regard to the provisions of s.4-A
of the Act, ss. 3 and 4 thereof were not required to be com-
plied with. The questions raised by the parties are of sig-
D
nificance. They should have been dealt with by the High +
Court. [Paras 7,8] [625-E,F,G]
2. The judgment of High Court is set aside and the
matters are remitted to the High Court for consideration
E ·and disposal thereof afresh. If any application is filed by
the parties heretO raising additional contentions, the same
may be considered by the High Court on their own mer-
its. [Para 9) [626~AJ
CIVILAPPELLATE JURISDICTION: Civil Appeal No. 5779
F of 2005
From the final Judgment and Order dated 7.10.2002 of
the High Court of Judicature at Patna in C.W.J.C. No. 10145/
2001
G WITH
Civil Appeal No. 5782 of 2005 and 5785 of 2005.
Rakesh DWidedi, Anoop G. Chaudhary, Vijay Hansaria,
S.8. Sanyal, R.G. Padia, Mathai M. Paikeday, Shobha Dikshit,
H K.K. Mohan, Amit Kr. Singh, Shantan':J Krishna, Mukti
MIS. DHARAMPAL ANOTHER v. STATE OF 623
BIHAR AND ORS. [S.B. SINHA, J.]
>- Chowdhary, Anant Prakash, Sneha Kalita, Sanjai K. Pathak, A
Vivek Narayan, Ajit Kumar Pande, Sunil Roy, Madhurima Tatia,
Anil Katiyar, V.K. Verma, Shishir Pinaki, Amit Singh, P.L Jose,
Pradeep Misra, Daleep Dhayani, Gopal Singh, Anukul Raj,
Manish Kr. and Chandan Kr. for the Appearing parties.
The Judgment of the Court was delivered by B
"-t S.8. SINHA, J. 1. These three appeals involve a question
as to whether the levy of market fee on Zafrani Zarda in terms of
the provisions of Bihar Agricultural Produce Market Act, 1960
(for short the Act) is valid which arise out of a common order c
dated 7th October, 2002 passed by the High Court of Patna in
three writ petitions filed by the appellants.
2. Writ petitioners are manufacturers of ZafraniZarda. It
. -of:
is indisputably a manufactured form of tobacco .
The question as to whether Zafrani Zarda is manufactured
D
item of tobacco or not came up for consideration before this
Court in Agricultural Produce Market Committee and others
v. Mis. Prabhat Zarda Factory and another, [1994 Supp (2)
SCC 514]. C This Court noticed that the definition of 'agricul-
tural produce' has undergone a change so as to include the E
'manufactured goods' therefrom by way of amendment on 3Qth
April, 1982. This Court noticed that the judgment of the High
Court did not take into consideration the changed definition of
> 'agricultural produce' with effect from 3Qth April, 1982 but up-
held the judgment of the High Court in respect of levy of market F
fee prior thereto.
3. Indisputably again with effect from 3Qth April, 1982
Zafrani Zarda was inserted in the Schedule appended to the
said Act, by reason of a Notification dated 31st July, 1991, is-
G
sued by the State of Bihar which reads thus:-.
~ • "No. 61Misc. 13191 - 6386 ... . Governor of Bihar in
exercise of its powers conferred under Section 39 of Bihar
Agricultural Produce Marketing Act, 1980 (Bihar Act 16 of
1960) makes the following amendment in the Schedule of the H
624 SUPREME COURT REPORTS [2008] 8 S.C.R.
A abovementioned Act :-
AMENDMENT
In the said list -Heading 11 - following heads should be
added or included after head 1 under Narcotic- Tobacco.
B 2. Zarda
3. Zafrani Zarda etc. +
The effect of this amendment shall be considered to be in
force from the date of implementation of Bihar Agricultural
c Produce Marketing Act, 1960.
By order of Governor of Bihar
Nagendra Tiwari
Joint Secretary to Govt."
D ')"
4. The State Government' issued another Notification be-
ing S.O. 220 dated 31•1 August, 1992 for ,regulation of sale,
purchase, storage and process of all agricultural produce men-
tioned in the Schedule of the Act in the areas covering 122
E market committees including the respondent Market Commit-
tee.
5. Questioning the orders of assessment of market fee
relying on and on the basis of the said G.Os., by the Assessing
Authority, the Writ Petitioners filed writ applications before the ...It.
F Patna High Court inter alia for the following reliefs:-
"i) issue Rule NISI calling upon the respondent to show
cause as to why the notice No.569 dated 08.06.2001,
638 dated 26.06.2001 and 770 dated 24.07 .2001
G as contained in Annexure 6, 7, 9 and issued by the
respondent Sec~etary, Agricultural Produce Market ....
Committee should not be set aside and quashed •
and upon return of the rule and after hearing the
parties make the rule absolute.
H ii) Issue rule in the nature of mandamus restraining the
M/S. DHARAMPAL ANOTHER v. STATE OF 625
BIHAR AND ORS. [S.B. SINHA, J.]
respondents from enforcing the provisions of Bihar A
Agriculture Produce Market Committee Act and the
Rules thereunder in respect of the petitioners dealing
in zafrani zarda and spices and demanding any fee
in respect thereof and upon return of the rule and
after hearing the parties make the rule absolute. B
iii) Issue Rule NISI in the nature of writ of mandamus
calling upon the respondents to show cause as to
why the notification issued under section 39 published
. in the Bihar Gazette Extra Ordinary dated 31.07.2001
(Annexure-2) be not declared invalid, illegal without C
jurisdiction and unenforceable and upon return of the
rule and after hearing the parties make the rule
absolute.
iv) Issue such other writ(s) order(s) direction(s) as your
0
Lordships may deem fit and proper."
6. In the said writ petitions, inter alia it was contended on
behalf of the respondent-Market Committee, that the market fee
would be assessed from the date of coming into force of the
Amendment i.e. 301h April, 1982 from which date the definition E
of 'agricultural produce' had been amended.
7. The High Court by reason of the impugned judgment
did not go into other contentions raised by the parties. It was
held that the market fee would be leviable with effect from 31•1
August, 1992. It failed to take into consideration the important F
question raised by the petitioners that the Notifications were
ultra vi res the Act and/or would have no application in relation to
Zafrani Zarda. It also did not take into consideration the con-
tention of the Market Committee that having regard to the provi-
sions of Section 4-A of the Act, Sections 3 and 4 thereof were G
not required to be complied with.
8. The questions raised by the parties are of significance.
They should have been dealt with by the High Court.
H
SUPREME COURT REPORTS [2008] 8 S.C.R.
A 9. We, therefore, are of the opinion that the impugned judg-
ment cannot be sustained. They are set aside accordingly
and the matters are remitted to the High Court for consider-
ation and disposal thereof afresh as expeditiously as possible
and preferably within a period of six months from the date of
8 receipt of a copy of this order.
+
If any application is filed by the parties hereto raising ad-
ditional contentions, ·the same may be considered by the High
Court on their own merits. ·
c 10. The appeals are disposed of accordingly with no or-
der as to costs .
. 8.8.B. Matter remitted to High Court
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