Deen Dayal Kuthiala vs Secy. Market Committee

S.N. Phukan, J.—By this common judgment and order I dispose of two Criminal revision petitions registered as Cr. Revision Nos. 45 and 46 of 1990. Both the petitions have been filed against the judgment and order of the lower appellate Court, namely, learned Sessions Judge, Solan dated 2nd March, 1990 passed in Criminal Appeal No. 41-S/10 of 1988 and 16-S/10 1989. Criminal Appeal No. 41-S/10 of 1988 was filed against the judgment passed by the learned Chief Judicial Magistrate, Solan in case No. 4/3 of 1985 and the other Criminal Appeal was filed against the judgment of the same Court passed in case No. 6/3 of 1985. The learned trial Court found the accused guilty u/s 32 of the Himachal Pradesh Agricultural Produce Markets Act, 1969 (hereinafter referred to as the Act) and convicted him in both the cases under the same Section and sentenced him to pay a fine of Rs. 500/- in each case and in default simple imprisonment of two months. The further sentence was also imposed at Rs. 20/- per day from the date of judgment till the accused-Petitioner obtains a licerse under the Act.

Two complaint petitions were filed against the accused-Petitioner for not obtaining license as required under Sub-section (3) of Section 4 of the Act. There is no dispute that no such license was taken by the accused. According to the prosecution, the premises of the accused was inspected and it was found that wheat of the value of Rs. 11,00,000/- was stored without obtaining license as required under the Act, The accused-Petitioner in his statement u/s 313 Code of Criminal Procedure stated that he was running a flour mill at Parwanoo but denied the allegation that he was indulging in purchasing, selling or storing the wheat as alleged.

Heard Mr. Kapil Dev Sood, learned Counsel for the Petitioner in both the petitions and Mr. Praneet Gupta for the Respondents.

The Act was enacted for better regulation of the purchase, sale, storage and processing of agricultural produce and establishment of markets for age cultural produce. Clause (a) of Section 2 of the Act defines "agricultural produce" which means all produce whether processed or not, of agriculture, horticulture, animal husbandry or forest as specified in the schedule to this Act. On perusal of the Schedule under heading cereals, wheat has been mentioned. In other words, wheat will come under the purview of the Act. Sub-section (3) of Section 4 inter-alia provides that no person will either for himself or on behalf of another person or of the Government, within the notified market area, set up, establish or continue or allow to be set up, established or continued or allow to be set up, any place for the purchase, sale, storage and processing of the agricultural produce so notified, or purchase, sell, store or process such agricultural produce except under a license granted in accordance with the provisions of the Act and the Rules and bye-laws made thereunder. Admittedly, the area where the flour mill of the accused-Petitioner is located comes within the notified area as per the notification issued u/s 4 of the Act. Now the question is whether the accused can be convicted for not obtaining the license inasmuch as his plea is that he has got a roller flour mill.

Before I deal with the above question, let me consider whether the imposition of recurring fine of Rs. 20/- per day from the date of judgment til1 a license is obtained under the Act is legal and valid.

Section 32 of the Act runs as follows:

Penalities. (1) Any person who contravenes any of the provisions of Section 4 or Section 25 of the rules or bye-laws made thereunder shall, on conviction, be punishable with simple imprisonment which may extend to 90 days or with fine which shall not be less than fifty rupees but may extend to five hundred rupees, or with both and in the case of a continuing contravention, with a fine which, in addition to such fine as aforesaid, may extend to thirty rupees for every day after the date of first conviction during which the contravention is continued.

(2) Any person who contravene any of the provisions of this Act or the rules or bye-laws made thereunder, except the provisions of Section 4 or Section 6 or Section 26, shall be punishable with fine which may extend to Rs. 200 and in the cases of continuing contravention, with a further fine of Rs. 20 for every day subsequent to the date of first conviction for which the contravention has continued.

Similar question came up for consideration before the Hon''ble the then Chief Justice regarding imposition of recurring fine under the Himachal Pradesh Panchayati Raj Act, 1968 in Sunka Ram v. Gram Panchayat Patta and Ors. 1984 Sim. L.C.230. The Court accepted the observations of the Division Bench of the Punjab High Court in Naurang Lal v. Gram Panchayat of village Gujarwas (LXIV(1964) PLR 28) and the following paragraph was quoted, namely:

The point is not that a Court or Panchayat cannot impose a recurring fine for a continuous breach of an order of this kind, but that it cannot do so on the first conviction of the offender for the breach, since by doing so it would be tantamount to imposing fine for an offence not yet committed, which cannot be done. In other words, after a conviction for disobedience of an order of this kind, whether passed by a panchayat or a municipal authority, the recurring fine can only be imposed after the continuance of the breach has taken place, and as long as the breach continues the Panchayat or Court must call the offender and impose the recurring fine on him from time to time as it becomes due".

I do not find any reason to take a different view and accordingly I hold that the above ratio is also applicable to the case in hand. In view of the above ratio, the imposition of such recurring fine is illegal inasmuch as the learned Court below prejudged the case that the accused-Petitioner would continue to violate the provisions of the Act. On this ground, that part of the fine is to be set aside which I hereby do.

It has been urged by Mr. Sood that accused-Petitioner is not liable to take a license in view of the decision of a Division Bench of this Court dated 30th November, 1994 delivered in a batch of writ petitions, namely, CWP Nos. 568 of 1988 and 39 and 238 of 1989 etc.

In Civil Writ Petition No. 238 of 1989, the Petitioners, were manufacturer of Katha (Cateche) and Cutch (Tannin) in a notified area. These articles are manufactured from KHAIR wood, an agricultural produce. However, these articles were not notified as an agricultural produce. According to the Petitioners in that case "they bring KHAIR wood from outside the market area within the market area and manufacture katha from the same." For this purpose, they have set up a modern scientific plant. After processing the KHAIR wood in the said plant, katha is produced which is sold in the market. The Division Bench considered the definition of "dealer" of the Act and noted that the word "manufacturer" is missing from the definition of dealer. Accordingly the Court held that manufacturer of a forest produce is not a dealer within the meaning of Section 2(i) of the Act. The next question that was considered by the Division Bench of this Court was whether the Petitioners were manufacturer of katha which is admittedly a notified agricultural produce. The Court also noted that in the writ petition it was alleged that the Petitioners were engaged in manufacturing katha from KHAIR wood. Therefore, it was held that katha was produced by the Petitioners by adopting scientific process and that the Petitioners are producers of katha, a forest produce covered by definition u/s 2(h) of the Act but not dealer in katha within the meaning of Section 2(i) of the Act. The Court further held that there is a distinction between the producer and a dealer inasmuch as a producer also grows, manufactures, rears and produces the notified agricultural produce besides disposing it of but a dealer only sets or establishes a place for purchase, sale or storage or processing of agricultural produce. Therefore, the contention of the Respondents that the Petitioners were dealers was rejected and according to the Division Bench, the Petitioners were not required to take the license u/s 4(3) of the Act. The Court also took into consideration the ratio laid down by the Apex Court in State of M.P. v. Hardeo AIR 1934 S.C. 2538.

In the case in hand also, there is no dispute that the accused-Petitioner is procuring wheat only for the purpose of and converting it to different products, namely, suzi, atta, maida etc. in his flour mill through process of manufacturing. In view of the ratio laid down by this Court in the above judgment and as the accused-Petitioner is not a dealer as defined in Section 2(i) of the Act, therefore, he is not required to take any license. In view of what has been stated above, I find merit in both the revision petitions and accordingly they are allowed by setting aside both the impugned judgments and orders.