STATE OF HARYANA Vs. OM PRAKASH

JUDGEMENT

(1.) THE solitary contention raised in this Letters Patent Appeal relates to the validity of the Haryana Rural Development Fund Act (No. 12 of 1983) (for short 'the Act' ). It has been tested on the anvil of the hallowed theory of quid pro quo by a learned single Judge of this Court, who has declared it as also the rules framed thereunder to be unconstitutional and void. Another set of 11 Civil Writ Petitions Nos. 2871, 3578 and 4213 of 1984, 960 to 963, 966, 967, 950, 907 of 1985, has also been filed assailing the Act on similar grounds and the learned counsel for the parties therein are agreed that the fate of these petitions is indisputably dependent on the result of this appeal. In order to appreciate the contentions raised by the learned counsel for the parties in this appeal, it is but necessary to have an idea of the salient features of the Act.

(2.) THE Act imposes cess on ad valorem basis at the rate of one per cent of the sale proceeds of agricultural produce brought or sold or brought for processing in the Notified Market Area. It is payable by the dealer as defined in Section 2 (c) of the Act and means any person who within the Notified Market Area sets up, establishes or continues or allows to be continued at any place for the purchase, sale, storage or processing of agricultural produce or in the Notified Market Area purchases, sells, stores, or processes such agricultural produce. As per S. 3 (3) the dealer is entitled to pass on the burden of the cess paid by him to the next purchaser of the agricultural produce from him and may, therefore, add the same in the cost of the agricultural produce or the goods processed, manufactured out of it. The cess so collected is to constitute a fund to be called the Haryana Rural Development Fund, which is at the disposal of the State Government. The purposes for which this fund is to be expended are specified in S. 4 (5) of the Act, which entitles the State Government to spend it in the rural areas in connection with the development of roads, hospitals, means of communication, water supply, sanitation and other schemes for the welfare of the agricultural labourers or for any other such scheme approved by the State Government for the development of the rural areas. The cost of administering it of course is also to be met from this fund. The State Government is obliged to publish annually in the Gazette the report of the activities financed from the fund together with the estimates of receipts and expenditure of the fund and a statement of accounts. The market and the notified market area is mentioned in the Act have to have the same meaning as specified in the Punjab Agricultural Produce Markets Act, 1961. It is the accepted position that the entire State of Haryana has been notified into different market areas and no part of it remains outside the market areas.

(3.) IN exercise of the powers conferred by S. 6 of the Act, the State Government has framed rules, known as the Haryana Rural Development Fund Rule, 1984. According to R. 3 (1), the cess is levied on the dealer and as per sub-r (2) the responsibility for the payment of the same is on the dealer, who is the buyer, and if he is not a licensee under the Punjab Agricultural Produce Markets Act, 1961, then of the dealer who is the seller. The cess is leviable as soon as the agricultural produce is bought or sold. R. 4 (1) requires the dealer to submit his return in Form 'a' to the Assessing Authority showing his purchases and sales on the very next day, but not in any case later than four days of the date of the transaction. Sub-rule (2) of this rule enjoins on the dealer to deposit in cash the cess that has become due from him on the basis of his return.