Case Note & Summary
The petitioners, Agricultural Produce Market Committee, Panvel, and its Chairman, filed a writ petition under Article 226 of the Constitution of India challenging the order dated 29th November 2003 passed by the Director of Marketing, Maharashtra State, in an appeal under Section 52B of the Maharashtra Agricultural Produce Marketing (Development and Regulation) Act, 1963. The respondent No.1, Godrej Agrovet Limited, a company registered under the Companies Act, 1956, is engaged in the business of manufacturing perishable items including animal feed and dressed chicken. It dispatches day-old chicks to contract farmers who rear them under the company's supervision for 40-42 days. The reared chickens are then sent to the company's processing unit at Taloja, where they are dressed, culled, and cleaned within 24-48 hours. The processed chicken is packed in transparent plastic bags labeled 'Godrej Real Good Chicken – fresh and chilled' and has a shelf life of about 48 hours. The petitioner Market Committee, within whose jurisdiction these activities occur, demanded market fees from the respondent No.1 based on vouchers indicating sales of processed chicken parts to various agencies. The respondent No.1 appealed to the Director of Marketing, who quashed the demand. The petitioners challenged this order. The court considered whether the processing and sale of chicken constitute a 'sale' of agricultural produce under the Act. The court analyzed the definition of 'agricultural produce' under the Act and concluded that the processed chicken is not agricultural produce but a manufactured product. The court held that the Director of Marketing correctly exercised his appellate power under Section 52B and that no market fee is leviable on the sale of processed chicken. The writ petition was dismissed.
Headnote
A) Agricultural Marketing - Market Fee - Levy on Processed Agricultural Produce - Section 52B of Maharashtra Agricultural Produce Marketing (Development and Regulation) Act, 1963 - The issue was whether the sale of processed chicken (dressed, culled, cleaned) by the respondent company to various agencies attracts market fee under the Act. The court held that the processing of chicken does not amount to 'sale' of agricultural produce as defined under the Act, as the chicken after processing is not 'agricultural produce' but a manufactured product. The Director of Marketing's order quashing the demand was upheld. (Paras 1-11) B) Appellate Jurisdiction - Director of Marketing - Powers under Section 52B - The Director of Marketing has the authority to examine the legality and propriety of the market committee's demand for market fee. The court held that the Director correctly exercised his appellate power to set aside the demand as the respondent's activity was not covered under the Act. (Paras 1-11)
Issue of Consideration
Whether the processing of chicken (dressing, culling, cleaning) and its sale as 'Godrej Real Good Chicken' constitutes a 'sale' of agricultural produce within the market area, attracting market fee under the Maharashtra Agricultural Produce Marketing (Development and Regulation) Act, 1963.
Final Decision
The writ petition is dismissed. The order of the Director of Marketing dated 29th November 2003 is upheld.
Law Points
- Interpretation of 'sale' under the Maharashtra Agricultural Produce Marketing (Development and Regulation) Act
- 1963
- Market fee exigibility on processed agricultural produce
- Scope of appellate power under Section 52B of the Act
