THAKUR PRASAD GUPTA Vs. STATE OF BIHAR

JUDGEMENT

(1.) The Impugned legislation in this case is the Bihar Agricultural Produce Markets Act (Bihar Act XVI of 1960), hereinafter referred to as the impugned Act. The Act received the assent of the Governor on the 6th of August 1960. By a notification made under Section 4 of the Act the State Government declared the entire area of Buxar as the "Market area" (Annexure B to the writ application, dated the 19th September, 1963). By another notification dated the 8thApril, 1964, the State Government notified the principal market yard and the Sub-market yard for the Buxar market area under Section 5 of the Act. The State Government also established a market committee by a notification under Section 6 of the Act on the 19th September, 1903, The petitioners are traders and commission agents for the sale and purchase of agricultural produce in Buxar in the Shahabad district. Their ease is that respondent No. 2 had issued a notice on the 29th March, 1964, requiring them to obtain a licence for trading In agricultural produce. It is contended on their behalf that the provisions of the Act imposed unreasonable restrictions on the right of the petitioners to carry on business and there is violation of the guarantee contained in Article 19 (1) (g) of the Constitution. It was contended that the notification of the State Government declaring the market area under Section 4 of the Act and the action of the market committee in asking the petitioners to take out licences, (which are Annexures B and A to the Writ applications), are ultra vires and illegal and must be quashed by grant of a writ in the nature of certiorari under Article 226 of the Constitution, It is also the case of the petitioners that the market committee has no lawful authority to levy and collect the market fees on the agricultural produce bought in the market area and the provisions of Rule 61 empowering the market committee to do so ultra vires.

(2.) In order to appreciate the constitutional question raised it is necessary to set out the relevant provisions of the impugned Act. The Act Is described as "An Act to provide for the better regulation of buying and selling of agricultural produce and establishment of markets for agricultural produce in the State of Bihar and for matters connected therewith." Section 2 (a) defines a "agricultural produce" as Including "all produce whether processed or non-processed of agriculture, horticulture, animal husbandry and forest specified in the Schedule". Section 2 (h) defines "market" as a market established under the Act for the market area and includes a market proper, a principal market yard and sub- market yard or yards, if any. Section 2(i) defines "market area" as any area declared to be a market area under Section 4. Section 2 (o) defines the "principal market yard" as "any enclosure, building or locality within the market proper declared to be a principal market yard under Section 5." Section 2 (t) defines a "Sub-market yard" as any enclosure, building or locality within the market proper declared to be a sub-market yard under Section 5. Section 2 (k) defines "market proper" as "any area within the market area Including all lands, with the buildings thereon, within such distance of the principal or sub-market yard as the State Government may by notification, declare to be a market proper under Section 5". Section 3 provides as follows :

(3.) The first question presented for determination In this case is whether the provisions of Section 4 of the impugned Act empowering the State Government to declare a market area in respect oi all or any of the kinds of agricultural produce specified in the notification is constitutionally valid. On behalf of the petitioners the argument was stressed that the restrictions Imposed by Section 4 read along with Section 15, of the Act are unreasonable as there is an infringement of the fundamental rights of the petitioners guaranteed under Article 19(1) (g) of the Constitution. I am unable to accept this argument as correct. In my opinion this question is fully covered by the decisions of the Supreme Court In M.C.V.S. Arunachala Nadar v. State of Madras, AIR 1959 SC 300 and Mohammad Hussam Gulam Mohammad v. State of Bombay, 1962(2) SCR 659: (AIR 1962 SC 97). In the first case the question at Issue was the validity of the Madras Commercial Crops Markets Act (Madras Act 20 of 1933). It was contended on behalf of the appellants in the Supreme Court that the statute Imposed unreasonable restrictions on the fundamental right of the appellants to carry on business. The argument was rejected by a unanimous Bench of the Supreme Court and it was held that the impugned provisions of the Act imposed reasonable restrictions on the right of the appellants to do business and were constitutionally valid. The same principle has been laid down by the Supreme Court in the second case, 1962 (2) SCR 659: (AIR 1962 SC 97). In that case the question debated before the Supreme Court was the constitutional validity of the Bombay Agricultural Produce Markets Act, 1939 (Bombay Act 22 of 1939). The Act was passed by the Bombay Legislature to provide for the better regulation of buying and selling of agricultural produce in the State of Bombay and the establishment of markets for such produce. Section 3 of the Act provided for the constitution of markets and market committees and gave power to the Commissioner by notification to declare his intention of regulating the purchase and sale of such agricultural produce and in such area as may be specified in the notification; and objections and suggestions were invited within a month of the publication of the notification. Thereafter the Commissioner, after considering the objections and suggestions if any, and after holding such inquiry as may be necessary, declared the area under Section 4(1) to be a market area for the purposes of the Act. The consequence of the establishment of the market area was given in Section 4(2) which laid down that after the market area was declared no place in the said area shall, subject to the provisions of Section 5-A, be used for the purchase or sale of any agricultural produce specified In the notification. After the declaration of the market area the State Government was given the power under Section 5 to establish a market committee for every market area. There after under Section 5-AA it became the duty of the market committee to enforce the provisions of the Act and also to establish a market therein on being required to do so by the State Government, providing for such facilities as the State Government may from time to time direct, in connection with the purchase and sale of the agricultural produce. In that case the petitioners challenged before the Supreme Court the validity of the Bombay Act and the rules framed thereunder, and in particular Sections 4, 4-A, 5, 5-A and 5AA, which provided for the declaration of a market area and the establishment of a market, as unconstitutional on the ground that they placed unreasonable restrictions on their right to carry on the trade. The argument was rejected by a unanimous Bench of the supreme Court and it was held that Sections 4, 4-A, 5, 5-A and 5AA of the Act were constitutional and intra vires and did not impose unreasonable restrictions on the petitioners to carry on trade regulated under the Act. The main provisions of the Bihar Act with respect to declaration of market area, namely, Sections 4 and 15, are similar in material respects to Sections 4, 4-A, 5, 5-A and 5-AA-of the Bombay Act, and the principle laid down by the Supreme Court in 1959 (2) SCR 659: (AIR 1962 SC 97) applies to the present case. It is also manifest that the Impunged provisions of the Bihar Act are also similar In material respects to those of the Madras Act, namely, Madras Act 20 of 1933 and the ratio of the Supreme Court decision In AIR 1959 SC 300 also governs the present case it follows, therefore, that the provisions of the Bihar Agricultural Produce Markets Act (Bihar Act: AVI of 1960) with regard to declaration of market area must be held to be Intra vires and constitutional.