LUCKY BISCUIT CO Vs. STATE OF BIHAR

JUDGEMENT

(1.) The petitioner is a registered partnership firm and manufactures biscuits at Patna City in the district of Patna. A notice (Annexure 1 to the writ petition) dated l0th of September, 1976 was issued to the petitioner by the Secretary, Agricultural Produce Market Committee, Patna City (respondent No. 3) calling upon the petitioner to obtain a licence from the Committee. It was stated that the petitioner was required to obtain the licence as it was purchasing and selling notified agricultural produce in Patna City market area. The licence to be obtained was for the year 1975. It was further stated that if the petitioner did not obtain licence within a week of the receipt of the notice, then it would be deemed that it was deliberately contravening the rules and legal action under Section 48 of the Bihar Agricultural Produce Markets Act, 1960 (hereinafter referred to as 'the Act') would be taken against it. The petitioner sent a reply to the said notice which is Annexure 2 to the writ application. The petitioner claimed that it was manufacturing biscuits and thereafter selling them. It purchased only such materials which were necessary for manufacture of biscuit but did not sell goods other than biscuit. As biscuit was not a notified agricultural produce it was not necessary for the petitioner to obtain a licence. Respondent No. 3 sent another notice (Annexure 3) dated 25th of September, 1976 to the petitioner referring to the letter (Annexure 2) of the petitioner and stating that as the petitioner was a trader within the meaning of Section 2 (1) of the Act it was necessary for it to obtain a licence as required by Rule 98 of the Bihar Agricultural Produce Markets Rules, 1975 (hereinafter referred to as 'the Rules'). It was further stated therein that as the petitioner was purchasing notified agricultural produce which were used in biscuit and stored them in its premises till biscuit was made out of them it was necessary for the Agricultural Produce Market Committee, Patna City (respondent No. 2) to get details of the purchases made by the petitioner, fees paid by it and notified agricultural produce kept in its stock. According to the rules, it was the buyer who had to pay the market fee and as the place of manufacture of the petitioner was situate in the main bazar area it was necessary for the petitioner to be a licensee. It was, however, made clear that as biscuit was not a notified agricultural produce, respondent No. 2 would not realise any market fee on its sale. Respondent No. 3 sent another notice (Annexure 4) dated 30th November, 1976 to the petitioner that as the petitioner had not by that date obtained the licence nor given any valid reason for not getting a licence and having purchased 400 tins of vegetable oil for Rs. 69,600/- on 20th May, 1976 from M. D. C. M. Co. but having not paid the market fee of Rs. 696/- at the rate of 10 per cent by itself or through M. D. C. M. Co.. the petitioner must obtain a licence at once and pay the arrears of market fee. The petitioner prays for quashing of Annexures 1. 3 and 4.

(2.) The substance of the case of the petitioner, as made out in the main petition, is that it merely purchases some of the notified agricultural produce but does not sell any notified agricultural produce and as such it is not a trader within the meaning of the terms as defined in Section 2 (1) (w) of the Act. Only traders were required to obtain licence under Rule 98 and the petitioner was, therefore, not liable to obtain a licence. It has further been stated in the petition that directions issued by the respondents to obtain licence were arbitrary, illegal and invasive of the liberties of the petitioner in curtailment of its right to carry on trade and business.

(3.) A counter-affidavit has been filed on behalf of respondents 2 and 3. It is stated, inter alia, therein that the petitioner admittedly purchases and stores notified agricultural produces for the manufacture of biscuits and carries on business of purchase of agricultural produce and sells goods prepared out of said produce. It further states that the petitioner also sells some of the notified agricultural produce which becomes either excess or not required for its purpose. It is submitted in the counter-affidavit that even if the petitioner only purchases agricultural produce in course of its business and sells products made out of it, it is a trader and liable to obtain licence. It has further been averred that the Act is intra vires and the demand by respondent No. 2 does not infringe the petitioner's right to carry on trade and business.