Case Note & Summary
The dispute arose from appeals filed by traders engaged in rice milling in Uttar Pradesh regarding the liability to pay market fees to the Market Committee under the U.P. Krishi Utpadan Mandi Adhiniyam, 1964. The appellants contended that the market fee should not be applicable when selling rice to the Government under the Levy Order, arguing that such transactions do not constitute a 'sale' and that the Government, as a purchaser, should bear the fee. The Allahabad High Court rejected these arguments, leading to the present appeals. The Supreme Court, while considering the matter, noted that a previous three-judge bench had already determined that the transactions in question were indeed sales. The court emphasized that the seller has a statutory obligation to remit the market fee to the Committee, regardless of whether they have collected it from the purchaser. The court referenced legislative intent and previous judgments to clarify that the seller's liability to pay the fee is not contingent upon the collection from the purchaser. Ultimately, the court dismissed the appeals, affirming the seller's responsibility to pay the market fee to the Market Committee.
Headnote
A) Agricultural Law - Market Fee Liability - Responsibility for Payment of Market Fee - U.P. Krishi Utpadan Mandi Adhiniyam, 1964, Section 17(iii)(b) - The court held that the seller is liable to pay the market fee to the Market Committee irrespective of whether the fee has been collected from the purchaser, clarifying the legislative intent behind the provisions. (Paras 1-5).
Issue of Consideration
Whether the market fee payable to the Market Committee shall be paid by the seller or purchaser when agricultural produce is sold by a trader to the Government.
Final Decision
The Supreme Court dismissed the appeals, affirming that the seller is liable to pay the market fee to the Market Committee irrespective of whether the fee has been collected from the purchaser.
Law Points
- Market fee liability
- agricultural produce sale
- trader obligations
- statutory interpretation
- legislative intent
Case Details
1998 LawText (SC) (08) 30
Civil Appeal Nos. 558, 559, 560, 561, 562 & 563 of 1997
K.T. Thomas, Syed Shah Mohammed Quadri
M/s. Mahaluxmi Rice Mills & Ors.
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Nature of Litigation
Dispute regarding liability to pay market fee under the U.P. Krishi Utpadan Mandi Adhiniyam, 1964.
Remedy Sought
Appellants sought to challenge the demand for market fee by the Market Committee.
Filing Reason
The appellants contended that the sale of rice to the Government did not constitute a transaction of sale for market fee purposes.
Previous Decisions
The Allahabad High Court rejected the appellants' contentions regarding the nature of the transaction and the liability to pay market fee.
Issues
Whether the sale of rice to the Government constitutes a transaction of sale for the purpose of market fee.
Who is liable to pay the market fee under the U.P. Krishi Utpadan Mandi Adhiniyam, 1964.
Submissions/Arguments
Appellants argued that selling rice to the Government under the Levy Order does not constitute a transaction of sale.
Market Committee contended that the seller is primarily liable to pay the market fee regardless of collection from the purchaser.
Ratio Decidendi
The court clarified that the seller has a statutory obligation to remit the market fee to the Market Committee, regardless of whether the fee has been collected from the purchaser, emphasizing the legislative intent behind the provisions.
Judgment Excerpts
The short question now remains is whether the market fee payable to the Market Committee shall be paid by the seller or purchaser when agricultural produce is sold by a trader to the Government.
The legislative intendment can easily be discerned from the frame of the sub-clause that what is conferred on the seller is only an option to collect market fee from his purchaser, but the seller has no such option and it is imperative for him to remit the fee to the Committee.
Procedural History
The appellants challenged the demands made by the Market Committee before the Allahabad High Court, which rejected their contentions. Special Leave Petitions were filed leading to the present appeals.
Acts & Sections
- U.P. Krishi Utpadan Mandi Adhiniyam: Section 6, Section 17(iii)(b)
