Secretary, Ramanathopuram Market Committee, Virudhunagar vs D. Srinivasan Cherttar

Natarajan, J.—This is an appeal by the complainant viz., the secretary, Ramnad Market Committee, Virudhunagar, against the acquittal of the Respondent in C.C. Nos. 45 and 46/74 by the learned Chief Judicial Magistrate, Devekottai. Since the questions involved in both the cases were common, the learned Magistrate disposed of the two cases by a common judgment.

The Respondent is admittedly the owner of a rice mill by name Srinivasa Rice Mill, situated at Manamadurai, Ramanathapuram District. Paddy is being hulled in the mill with the aid of the machinery installed therein. Ramanathapuram District has been declared a notified area and paddy had been declared a notified produce under the Tamil Nadu Agricultural Produce Markets Act, 1959 (hereinafter referred to as the Act). A committee known as the Ramnad Markets Committee was constituted under the provisions of the Act. By reason of such constitution, the Committee gets power u/s 6 of the Act to inhibit persons, within a notified area, from setting up, establishing, or using or continuing or allowing to be continued, any place for the purchase or sale, storage, weighment, pressing or processing of any notified agricultural produce except under and in accordance with the conditions of a licence granted to him by the Market Committee. Having regard to the power conferred on it u/s 6, the Committee called upon the Respondent to take out a licence for his rice mill. The Respondent contended that be was not bound to take out a licence as he was not engaged in the process of buying or selling paddy, and therefore, the Committee was not entitled to insist upon his taking out a licence. Hence the Committee "preferred two complaints against the Respondent, one relating to the period 1st December 1972 to 3lst March 1973 and the other relating to the period 1st April 1973 to 31st March 1974 for his carrying on the rice mill without a licence under the Act.

The learned Chief Judicial Magistrate (then District Magistrate) accepted the contention of the Respondent that he was hulling the paddy of growers and consumers and he was not hulling paddy for commercial purposes. Further more be held that the provisions of the Act would be attached only to such cases where there is purchase and sale at some stage or other, and not otherwise, In accordance with these views, he acquitted the Respondent and hence the appeal against the acquittal.

Mr. Thirumalai learned Counsel for the Respondents reiterated the reasons given by the Magistrate for sustaining the order of acquittal. On the other hand, Mr. Damodaran, learned Counsel representing Mr. Alegiriswami, counsel for the Appellant, contends that for attracting the provisions of the Act an element of purchase or sale is no necessary ,and that preparatory stages as well as intermediary stages between the acts of purchases or sale will also attract the operation of the Act. To appreciate the contentions of the parties it is necessary to make a brief reference to the relevant provisions of the Act.

The preamble to the Act is as follows:

Whereas it is expedient to provide for a better regulation of buying and selling of agricultural produce and the establishment and proper administration of markets for agricultural produce in the State of Madras.

The learned Magistrate has construed the preamble to mean that the provisions of the Act are intended only to regulate the buying and selling of agricultural produce. This view cannot be accepted, for, unless there is regulation at all stages, there cannot be an effective control over the purchase and sale of agricultural produce. This is what the Legislature should have intended, can be clearly seen from the other provisions of the Act. First, let me refer to Section 6 itself which is the crucial section for consideration in the instant case. Though the marginal note for the section states as "Trading in agricultural produce in notified area", the section itself is to the following effect:

No person shall, within a notified area, setup, establish or use, or continue or allow to be continued, any place for the purchase or sale, storage, weighment, pressing or processing of any notified agricultural produce except under and in accordance with the conditions of a licence granted to him by the market committee.

Thus, it may be seen from the section that it is not only a place for the purchase or sale that would attract the operation of the Act, but also any place for storage, weighment, pressing, or processing of any notified agricultural produce Storage, weighment, pressing, processing of notified agricultural produce can be done either before purchase or in the intermediary stage between buying and selling. It is also significant to note that one of the things contemplated in the section is a place of processing. The terminology "processing" will undoubtedly include within its ambit the word "hulling" which is the operation carried on in a rice mill. The proviso to S. 6(1) makes it clear that while normally a producer selling his agricultural produce can be exempted from the provisions of the Sub-section, the Government may withdraw the exemption on appropriate occasions. It it thus seen that even a producer can be compelled under certain circumstances to take out a licence under the Act. In S. 2 which is the definition Section, Clause (xiii) defines "producer" and it is clearly stated therein that the word "producer" would not include a dealer or broker, although he may grow, rear or produce a notified produce. This definition will make it clear that a dealer or broker, though he may also be a producer, cannot claim exemption from the provisions of the Act since he has some connection with the buying, selling, storing, weighing etc., of the produce.

The learned Magistrate has referred to Section 3 of the Act and held that the reference therein to "control over the purchase and sale of agricultural produce" is a pointer to hold that the Act would apply only to cases where there is some element of purchase or sale. No doubt, the Act is intended to provide for better regulation of buying and selling of agricultural produce. But as 1 have already stated, such control cannot be effectively exercised unless regulations are enforced at the preliminary as well as intermediary stages of the transactions of buying and selling. Reference is also made by the learned Magistrate to S. 6(2) which exempts from the operation of the Act, a person purchasing notified agricultural produce for his own domestic consumption. From this reservation alone the Magistrate is not justified in thinking that the Act was intended only to apply to dealers and merchants. Even Section 6(2) says that a domestic consumer cannot purchase notified produce exceeding the quantity prescribed by the Market Committee. The learned Magistrate has failed to make a difference between a person buying or holding stock for his own personal use as against a person regularly storing, weighing or processing a notified agricultural produce for the purpose of business. It may be that the producers who bring in their paddy to the Respondent''s mill for being hulled need not take out a licence. But, certainly the Respondent cannot take umbrage under that provision. He is a professional man running a rice mill for commercial use, and as such, he cannot be heard to say that the exemption granted to domestic consumers would apply to him also, because he hulls only the paddy belonging the domestic consumers. Even that contention cannot be factually accepted and the finding of the learned Magistrate that the 1976 L.W. (Cri.) 23 Respondent was hulling paddy only for domestic consumers and not merchants cannot be accepted. It is inconceivable that a man would be running a rice mill solely to cater to the needs of domestic consumers and not for producers or merchants hulling paddy into rice for commercial purposes.

The learned Magistrate has also placed reliance on Sections 18 and 22 to conclude that the reference in those sections to purchase and sale of agricultural produce would also warrant the conclusion that the Act would not apply to persons who are not directly engaged in the purchase or sale of notified produce. That view also is certainly wrong. Sections 18 and 22 have been enacted to empower the Market Committee to levy cess as well as subscriptions for market reports, etc. They have nothing to do with the regulatory stipulation contained in Section 6 of the Act.

Lastly, the learned Magistrate has placed reliance on Section 29 which gives power to Government to make rules to more effectively fulfil the scheme of the Act. Clause (viii) empowers Government to frame rules regarding the issue by the Market Committee of licences to brokers, weighmen, measurers and surveyors. Merely because the word ''millers or hullers'' are not contained in the clauses, the learned Magistrate is not correct in thinking that rice mill owners would not be affected by the provisions of the Act. It is needless to say that a rice mill cannot be run without a licence under other enactments whereas brokers, weighmen, measurers, surveyors, etc, can carry on their activities without obtaining a licence under any Act. It was on account of that Section 29 provided that rules can be framed for issuing licence to brokers, weighmen, etc. It it pertinent to point out that Clause (viii) does not say anything about weighmen measurers, surveyors, etc. being engaged in particular places of operations alone being obliged to take a licence. Their services even at pieces of storage or weighment would also attract the operation of the Act. Yet another mistake committed by the learned Magistrate in that the power of a Market Committee to frame by-laws u/s 30 of the Act cannot go beyond the subjects enumerated u/s 29 which is the rule making section. The learned Magistrate has failed to see that a Market Committee is empowered to frame suitable by-laws u/s 39 for due implementation of the Act subject to the condition that any by-law or by-laws so made should not run counter to any rule framed by the Government in exercise of its power u/s 29. Hence the learned Magistrate is not justified in thinking that because Section 29 makes no reference to rice mill etc., the Market Committee was not entitled to frame a by-law relating to rice mills and hulling process of paddy carried thereat.

It may be mentioned here that in exercise of the powers conferred u/s 30, the Appellant-Society bad framed by-laws and the by-taws include process of bullying of paddy in rice mills, within the ambit of the word ''processing'' occurring in Section 6(1) of the Act.

The Appellant, was, therefore, fully justified in demanding the Respondent to take out a licence u/s 6(1) of the Act. Unless effective supervision is done by the Market Committee at all places contemplated under the Act, viz., places of storage, place of weighment, places of processing etc., in addition to the places of purchases and sale, the Committee cannot effectively discharge the duties cast upon it, to regulate the purchase and sale of notified agricultural produce in notified areas. Hence, the order of acquittal of the learned Magistrate cannot be sustained. Technically the Respondent must be held to have contravened the provisions of the Act, for which he stood charged. The appeal will, therefore, stand allowed and the Respondent will stand convicted u/s 6(1) and 25 of the Tamil Nadu Agricultural Produce Market Act of 1959 read R.22 of the Tamil Nadu Agricultural Produce Market Rules, 1962, and by laws 2(x),21(c) and 21(2) of the Ramanathapuram Market Committee. He is sentenced to pay a fine of Rs 50/- (Rupees Fifty only) in default to undergo simple imprisonment for fifteen days for the conviction in C.C. No. 45 of 1974, and a fine of Rs 100/- (Rupees one hundred only), in default to undergo simple imprisonment for one month for the conviction in C.C. 46/1974. Time for payment, eight weeks from today.