Agricultural Produce Market Committee vs Shivashakti Traders Onion, Potato Merchants and Commission Agents and The Director of Agricultural Marketing Department of Agricultural Marketing

K.L. Manjunath, J.—Heard the learned senior counsel Sri B.G. Sridharan, appearing for appellant.

The legality and correctness of the order passed In W.P. No. 417365/2008 dated 29-01-2009 is called In question in this appeal.

The first respondent aggrieved by the order passed by the appellant dated 19-12-2006, which is produced as Annexure-J to writ petition, filed writ petition on the ground that the order is passed without diving an opportunity to him and he has been prevented from carrying on business on the ground that he did not make payment to the seller of the potatos within five days as required u/s 75 of the Karnataka Agricultural Produces Marketing (Regulations) Act, 1966 (in short the Act'').

It appears that on the complaint lodged by M/s Himamshu Traders, Shajapur, Madhya Pradesh, a show cause notice was issued to first respondent on the ground that in accordance with Section 75 of the Act no payment has been made to said M/s Himamshu Traders, from whom the first respondent is said to have purchased the potatos. The respondent sent or reply stating that there was no transaction between the first respondent and M/s Himamshu Traders and that he had purchased the potatos from one Mr. Madanlal, GPR Traders and Manju Traders. The Appellant has passed the order Invoking Section 75 of the Act on the ground that he could not carry on the business on account of non-payment of the dues payable to the sellers of the potatos.

This order was called in question by the first respondent by fill no writ petition. The learned Single Judge after hearing the parties has directed the appellant herein to rehear the matter by giving an opportunity to the first respondent and take action In accordance with law. This order Is called in question in this appeal.

The main contention of Mr. B.G. Sridharan, is that Section 75 of the Act is mandatory and that there is no option for the appellant to grant time to the respondent. Therefore, he contends that the order of the learned Single Judge has to be set aside. But we are not in a position to accept the arguments advanced by the learned Counsel for appellant for the following reasons:

Section 75 of the Act reads thus:

Payment of Price.

(1) Subject to such deductions, if any, as are authorized to be deducted according to this Act or the rules or the bye-laws or under any other law for the time being in force, by way of.--

(i) fees;

(ii) market charges;

(iii) taxes, and

(iv) the advances, if any, on the goods made as evidenced by authentic vouchers with interest which shall not be more than the rates charged by the Scheduled Banks if any, due thereon;

the price of the goods sold in the market yard and outside the market or the sub-market in the market area shall be paid to the seller by the buyer in cash or cheque, immediately after the sale except in a case where a commission agent, if any, agrees in writing, in the form prescribed by the bye-laws, to give delivery to the buyer on credit of a term which snail in no case exceed the maximum period of credit prescribed by the bye-laws, if any.

(2) In case buyer does not make payment under Sub-section (1), he shall be liable to make additional payment at the rate of one percent per day of the total price of the notified agricultural produce payable to the seller within five days.

(3) In case buyer does not make payment with additional payment to the seller under Sub-section (1) and (2) above, within five days from the day of such purchase his licence or registration as the case may be shall be deemed to have been cancelled on the sixth day and he shall not be registered or granted any licence or permitted to operate in any market area within the State under this Act for a period of one year from the date of such cancellation.

In the instant case, the complaint is lodged by M/s Himamshu Traders, but the first respondent has disputed the very transaction between it and said M/s Himamshu Traders. According to the first respondent the potatos are purchased from one Madanlal of GPR Traders and Manju Traders. If it is so, it is imperative on the part of the appellant to find out whether any potatos were supplied by M/s Himamshu Traders, who has lodged the complaint. Unless and until there is privity of contract between the Complainant and first respondent Section 75 of the Act cannot be pressed into service by the appellant.

On perusal of the record it is clear that the appellant herein has not given any finding in regard to the nature of transaction between the Complainant - M/s Himamshu Traders and the first respondent. If really there is no privity of contract between them, based on the complaint placed by M/s Himamshu Traders, the licence of first respondent cannot be withdrawn as it would take away livelihood of the first respondent for no fault of it.

In these circumstances, though payment of seller is mandatory as stipulated u/s 75 of the Act still it is for the appellant to decide the actual disputed facts. Section 75 of the Act could be pressed into service by appellant if only there is an admission in regard to the nature of transaction and non-payment of dues within five days as stipulated under the Act.

Since such finding is not there in the order-passed by the appellant, there is no error committed by the learned Single Judge in directed to reconsidering the matter. Accordingly, the writ appeal is dismissed.