Case: Kewal Krishan Puri and Another Vs. State of Punjab and Others


Decision:
1[ds]A question arises-"special service" rendered to whom which kind of individuals?I n our opinion this argument is neither logical nor sound. The impost of fee and the liability to pay it is on a particular individual or a class of individuals. They are under the obligation to submit accounts, returns or the like to t he authorities concerned in cases where quantification of the amount of fees depends upon the same. They have to undergo the botherations and harassments, sometimes justifiably and sometimes even unjustifiably, in the process of discharging their liability to pay the fee. The authorities levying the fee deal with them and realize the fee from them. By operation of the economic laws in certain kinds of impositions of fee the burden may be passed on to different other persons one after the other.The above passage does not mean that the service rendered is unconnected with or not meant for the payer of the fee. As pointed out earlier, service rendered to an institution like a Math is a service rendered to the payer of the fee. Similarly services rendered to a specific area or to a specific class of trade or business in any local area must mean, and cannot but mean, that it is for the special benefit of the person operating in that area. The service rendered was to the mining area for the benefit of the mine owners at that area. The area or trade does not pay the fee nor does it get the benefit in vacuum. The fee is paid by the person who is liable to pay it and service to t he payer does not mean any personal or domestic service to him but it means service in relation to the transaction, property or the institution in respect of which he is made to pay the. If the view taken by the High Court in the market fee cases were to hold good, then pushing it to the logical conclusion one will have to say that giving all sorts of facilities to the litigants for their travel from the village homes to the Courts would also be a service of them In cases of court fees one has to take broad view of the matter to find out whether there exists a broad co-relationship with the fees collected and the cause of administration of justice. Even mixing the amount of court fee collected with the general fund will be permissible. It may not be kept in a separate fund or earmarked separately. The very fact that in relation to court-fees there are separate Entries in the Seventh Schedule e.g. Entry 77 List I and Entry 3 of List II, indicates that even though the character of the levy is not very much different from that of the general types of fees, in the matter of approach for finding out the element of quid pro quo quite a different test has not to be applied as indeed, to some extent it has to be applied in many kinds of fees depending upon the totality of the facts and circum stances. Each case has to be judged from a reasonable and practical point of view for finding out the element of quid pro quo.In contrast in the present case the whole of the State has been divided into different market areas, although the principal market yard is only one in one area with some sub market yards appertaining to it. We do not mean to suggest in pointing out this difference that the declaration of the whole market area is unreasonable. But the market fee has to be realized from the traders on the purchase of the agricultural produce in the market which consists of the market yards and some purchasing centres established at some other places in the area due to the urgency or exigency of the situation. Such a fee cannot be utilised for the purpose of rendering all sorts of facilities and services for the benefit of the agriculturists throughout the area. It may be very necessary to render such services to the agriculturists; rather, they must be rendered. But the laudable and in itself cannot justify the means to achieve that end if the means have got no sanction of the law. In the Bihar case it was found at page 540:-"The market committee has appointed a dispute subcommittee for quick settlement of disputes. It has set up a market intelligence unit for collecting and publishing the daily prices and information regarding the stock, arrival and despatches of agricultural produce. It has provided a grading unit where the techniques of grading agricultural produce is taught. the contract form for purchase and sale is standardised . The provisions of the Act and the Rules are enforced through inspectors and other staff appointed by the market committee. The fees charged by the market committee are correlated to the expenses incurred by it for rendering these services. The market fee, of 25 naya paise per Rs. 100/ worth of agricultural produce and the licence fees prescribed by Rules 71 and 73 are not excessive. The fees collected by the market committee form part of the market committee fund which is set apart and earmarked for the purposes of the Act. There is sufficient quid pro quo for the levies and they satisfy the test of "fee" as laid down in Commissioner Hindu Religious End owments Madras v. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt-[954] S.C.R., 1005."22. It would be noticed that even the rate of 25 paise per hundred rupees had to satisfy all these tests. In the instant cases we are concerned with the rates of market fee which are much higher than the Bihar rate. Correlative service also, therefore, must satisfy the tests of rendering more services in the market area. The fund cannot be permitted to be utilised for an end, such as, augmenting the agricultural produce etc., if it has no reasonably direct or close connection with the services rendered to the payers of the fee.23. From a conspectus of the various authorities of this Court we deduce the following principles for satisfying the tests for a valid levy of market fees on the agricultural produce bought or sold by licensees in a notified marketThat the amount of fee realised must be earmarked for rendering services t o the licensees in the notified market area and a good and substantial portion of it must be shown to be expanded for this purpose.(2) That the services rendered to t he licensees must be in relation to the transaction of purchase or sale of the agricultural produce.(3) That while rendering services in the market area for the purpose of facilitating the transactions of purchase and sale with a view to achieve the objects of the marketing legislation it is not necessary to confer the whole of the benefit on the licensees but some special benefits must be conferred on them which have a direct, close and reasonable correlation between the licensees and the transactions.(4) That while conferring some special benefits on the licensees it in permissible to render such service in the market which may be in the general interest of all concerned with the transactions taking place in the market.(5) That spending the amount of market fees for the purpose of augmenting the agricultural produce, its facility of transport in villages and to provide other facilities meant mainly or exclusively for the benefit of the agriculturists is not permissible on the ground that such service in the long run go to increase the volume of transactions in the mark et ultimately benefiting the traders also. Such an indirect and remote benefit to the traders is in no sense a special benefit to them.(6) That the element of quid pro quo may not be possible, or even necessary, to be established with arithmetical exactitude but even broadly and reasonably it must be established by the authorities who charge the fees that the amount is being spent for rendering services to those on whom falls the burden of the fee.(7) At least a good and substantial portion of the amount collected on account of fees, may be in the neighbourhood of two-thirds or three-fourths, must be shown with reasonable certainty as being spent for rendering services of the kind mentionedit to say that there is no special provision in the Statute for establishment of markets or markets proper as per the definition contained in clauses (i) an d (k) of section 2 of the Act, yet it is reasonable to assume that the intention of the legislature is to constitute the market yards as the market proper and ordinarily and generally the market would be the same but may include some other place s where transactions of purchase of agricultural produce by the traders from the producers has been allowed in order to avoid rush in the precincts of the market proper. But one thing is certain that the whole of the market area in no sense can be equated with market or market proper. No body can be allowed to establish a purchasing centre of his own at any place he likes in the market area without there being such a permission or authority from the Market Committees. After al l the whole object of the Act is the supervision and control of the transactions of purchase by the traders from the agriculturists in order to prevent exploitation of the latter by the former. The supervision and control can be effective only in specified localities and places and not throughout the extensive market area.We have already pointed out that there is no separate notification or declaration establishing a market or marketReading section 23 along with Rule 29 it would be noticed that the power of the Committee to levy fees is subject to the Rules as may be made by the State Government. The fee is levied on ad-valorem basis at a rate which cannot exceed the maximum, mentioned in section 23 by the legislature. But the power to fix the rate from time to time within the maximum limit has been conferred on the Board and the Committee is merely bound to follow it. Oneof the arguments before us on behalf of the appellants and the petitioners was that it was the Board which fixed the rate of Rs. 2/- first and thereafter Rs. 3/- per hundred rupees.The Committee abdicated its function in this regard and, therefore, the levy of fee is contrary to the principle of law laid down by this Court in the case of State of Punjab and another v. Hari Krishan Sharma(l). But the distinction between the said case and the present one is that under the former there was no provision in section 5(l) of the Punjab Cinemas (Regulation) Act of 1952 that the power of the licensing authority to grant licence was subject to any rule, the rule in its turn providing an over riding power in the State Government in the matter of grant of lic ence. The control of the Government provided in sub- section (2) was of a limited kind. On the other hand section 23 in express language controls the power of Committee to levy fees subject to the rules. The power given to the Board to fix the rate o f market fees from time to time under rule 29 is not ultra vires the provisions of the Act, as in our opinion sub-section (9) of section 3 confers power on the Board to exercise superintendence and control over the Committees, which power, in the context and the scheme of the marketing law will take within its ambit the power conferred on the Board under rule 29(1).It is further to be pointed out that the fee levied is not on the agricultural produce in the sense of imposing any k ind of tax or duty on the agricultural produce Nor is it a tax on the transaction of purchase or sale. The levy is an impost on the buyer of the agricultural produce in the market in relation to transactions of his purchase. The agriculturist s are not required to share any portion of the burden of this fee. In case the buyer is not a licensee then the responsibility of paying the fees is of the seller who may realise the same from the buyer. But such a contingency cannot arise in respect of the transactions of sale by an agriculturist of his agricultural produce in the market to a dealer who must be a licensee. Nor was any such eventuality occurring in any of the cases before us was brought to our notice. Probably such an alternative provision was meant to be made for outside buyers who are not licensees when they buy the agricultural produce from or through the licensees.Let us first scan these clauses one by one on the footing that the Market Committee Fund will ordinarily and generally and almost wholly will be created out of the income of a particular Market Committee on account of market fees realised by it from the traders in the market. A portion of it may be on account of fines, licence fees, from weighment, arbitration fees etc. But those amounts compared to the huge realisations on account of market fees would be al most negligible. By and large the purposes enumerated in clauses (i) to (ix) are relatable to the service to be rendered in the market in relation to the transactions of purchase and sale of the agricultural produce. We shall deal with the problem of payment of interest on loans that may be raised for purposes of the market as mentioned in clause (vi) shortly hereinafter. Apropos clause (viii) the attention of all concerned must be focussed here because the last part of this clause h ad led the authorities and also the High Court to think that construction of link roads, culverts and bridges any where in a notified market area is covered by this clause. In our opinion it is not so. In the context of the language of all t he clauses preceding clause (viii) and clause (viii) itself it is plain that what is meant by "construction and repair of approach roads; culverts, bridges" is only for the purpose of the facility of going into the market from the nearest public road. Supposing a market has been established consisting of principal market yard or sub-market yards at a particular place where there is no facility for the carts or the trucks and other vehicles to go, then approach roads, and if necessary eve n culverts and bridges may be constructed, or repaired out of the Market Committee Fund. Such an expenditure within the limited limit will be with the object of facilitating the taking place of the transactions of purchase and sale in the market and will confer some special benefits to the traders apart from a share of the benefit going to the agriculturists who are not required to share any burden of the market fee. But as we have pointed out above, if one were to give a very wide meaning to this phrase of construction and repair of approach roads, culverts and bridges to say that such construction can be permitted any where in the market area for the facility of the agriculturists which ultimately will benefit the traders also, then the whole concept of correlation of fee and its character of having an element of quid pro quo will dwindle down and become an empty formality. Uplift of villages and helping the agriculturists by all means is the duty and the obligation of the State no doubt and it has to do it by incurring expenses out of the public exchequer consisting of the income from various kinds of taxes etc.One may not have any serious objection to the items of expenditure mentioned in clauses (xii), (xiv), (xv) and (xvi). But the other clauses do require some careful examination. Obviously clause (x) and clause (xi) cannot form the items of expenditure out of the market fees. In face of the view of the law expressed by us above the propaganda in favour of the agricultural improvement and expenditure for production and betterment of agricultural produce will be in the general interest of agriculture in the market area. The whole of the State is divide d into market areas. So long as the concept of fee under our Constitution remains distinct and limited in contrast to tax such expenditure out of the market fee cannot be countenanced in law. The first part of clause (xiii) may be justified in the sense of imparting education in marketing to the staff of the Market Committee. But imparting education in agriculture in general cannot be correlated with the market fee. The first part of clause (xvii) is too vague to merit any discussion on the language of the clause itself until and unless we are faced with concrete examples of such expenditure. But how ill-conceived the second part of clause (xvii) is, is abundantly clear from the decisions of the Punjab High Court mentioned above and to be discussed shortly hereinafter. Is it permissible to spend the market fees realised from the traders for any purpose calculated to promote the national or public interest ? Obviously not. No Market Committee can be permitted to utilise the fund for an ulterior purpose howsoever benevolent, laudable and charitable the object may be. The whole concept of fee will collapse if the amount realised by market fees could be permitted to be spent in t his fashion. We may, however, mention one matter pointedly in connection with the Market Committee Fund. Under section 32 the Committee may borrow money for carrying on the purposes for which it is established on the security of any pr operty vested in and belonging to the Committee. It may obtain a loan from the State Government or the Board. In the various figures and charts submitted before us it was shown that the Market Committees had raised money by loan and other metho ds. That also will form the market committee fund. Technically and legally, therefore, one may not have any objection to the expenditure of such money for the purposes mentioned in clauses (x), (xi) (xiii) and (xvii). As we indicated above cla use (vi) provides for payment of interest on loans, but that is confined to loans that may be raised for purposes of the market and not for any other purpose, whereas, the power of the Committee to raise loans under section 32 is very wide. The Act, however, is silent as to where from interest will be paid or the principal will be returned in regard to the amount of loan raised for a purpose other than the purpose of the market. Since we find that the matter has proceeded at various stage s in the High Court as also in this Court under a great confusion of the correct position of law, we do not propose to express any opinion in this regard at this stage. Nor do we propose to strike any clause of section 28 as being unconstitutional merely on the ground that the expenditure authorised therein goes beyond the scope of the purpose of the utilisation of the market fees. The authorities have to bear this in mind and on a proper occasion the matter will have to be dealt with by courts in the light of this judgment where a concrete case comes of raising of a loan, spending the money so raised which cannot be reasonably connected with the purposes for which the market fee can be spent, as to whether such a loan can be re paid or interest on it can be paid out of the realizations of the market fees.One of the points mooted before us was as to how far the market committees can be compelled to part with 30% of their income in favour of the Marketing Board. If so , for what purposes the Board fund, namely, the Marketing Development Fund can be expanded. It is to be remembered that market fee is levied by each and every Market Committee separately in its own area and if a good and substantial p ortion of this fee has got to be expanded for rendering services in the area to the payers of the fee in relation to the transactions taking place therein, then logically speaking it flows from it that any money paid to the Board out of the collecti ons of the market fee has also got to be expended in the very same area of the particular Market Committee. But such a strict construction from a practical point of view is not possible. The Board in the State is the Central Controlling and superintending authority over all the Market Committees, the primary function of which is to render service in the market. Parting with 30% income by a Market Committee in favour of the Board is not so excessive or unreasonable so as to warrant any interference with the law in this regard on the ground of violation of the principle of quid pro quo in the utilisation of the market fee realised from the traders in the market area. We would, however, like to emphasise that the Marke ting Development Fund can only be expended for the purposes of the Market Committees in a general way, or to be more accurate, as far as practicable, for the purposes of the particular Market Committee which makes the contribution.On a parity of the reasoning which we have applied in the case of Market Committee Fund we may point out that the Market Development Fund constituted primarily and mainly out of the contributions by the Market Committees from realisations of market fees, can also be expended for the purposes of the market in the notified market area in relation to the transactions of purchase and sale of the agricultural produce and for no other general purpose or in the general interests of the agriculture or the agriculturists. On that basis we may, as at present advised hold as valid the purposes mentioned in clauses (i), (ii), (iii), (iv), first part of clause (v) clauses (vi), (vii), (viii), (ix), (xii), first part of clause (xiii), clauses (xiv), (xv) and (xvi). At the same time we hold that the Marketing Development Fund constituted out of t he Market fees cannot be expended for the purposes mentioned in second part of clause (v), clauses (x), (xi), second part of clause (xiii) and clause (xvii). We do not propose to strike down these provisions as being constitutionally invalid as the purpose of the law will be served by restricting the operation of section 26 in the manner we have done.We may note here that in the batch of appeals we heard there w as no appeal from the judgment of the High Court in the case of Hanuman Dall &General Mills. We may reasonably assume, therefore, that the dealers of Haryana were reconciled for payment of the market fees upto the maximum limit of two rupee s per hundred rupees. In the case of Punjab, as we traced the history at the very outset, the maximum fixed later was Rs. 2.20 by Act 14 of 1975. But by telegraphic instructions issued by the Board the Market Committees were asked to char ge Rs. 2/- only with effect from 23-8-1975. This was challenged before the High Court but unsuccessfully in the case of Kewal Krishan Puri and another v. The State of Punjab and others (supra). Civil Appeal 1083 of 1977 is from this judgment o f the High Court. The Full Bench judgment in this case also suffers more or less from the same kind of error in the approach of the legal problem as is to be found in the earlier Division Bench decision.It is to be emphasised at this stage that the question is not of the legislative competence to enact those clauses, nor is there a question of the fee assuming the character of a tax and therefore, its imposition being beyond the legislative competence of the State Legislature. The precise and the short question is whether the Market Committees and the Board can be authorised to spen d the amount realised by market fees, as fee and fee alone for achieving all the objects of the Act when such expenditure cannot be justified and sustained on the well-known concept of fee as pointed out by this Court in several decisions. The impost must be correlated with the service to be rendered to the payers of the fees in the sense and to the extent we have pointed out above.In several Civil Writ Petitions filed in the High Court by the dealers of the various Market Committees of Haryana the challenge, was to the raising of the rate of market fee from Rs. 2/- to Rs.3/-. The High Court rejected all those petitions by the judgment dated 30-8-1978 which is the subject matter of appeal in Civil Appeal No. 1708 of 1978 and the analogous ones. After referring to the earlier judgments of the Court this judgment of the Division Bench also proceeds on the same lines at it was bound to. To a large extent we are saved from the unnecessary botheration of examining the voluminously new materials placed before us in view of the counter filed on behalf of the Haryana Marketing Board in the High Court portions of which are extracted in the judgment. It will be useful to give the whole of the extract from the judgment of the High Court. It runs asis well known to every one that the recent floods in Haryana were unprecedented and created havoc in the State Almost one-third of Haryana was submerged under water damaging the standing crops and uprooting the inhabitants making them homeless. The State has to resort to quick measures, for removing the miseries of the people and to rehabilitate them................................................................................................ ..............The projected income from market-fee in the year 1977-78 was Rs. 9 crores. But due to the floods at the old rate of 2% it is expected to be Rs. 7.77 crores. The Committees will only be able to achieve the project ed income of 1977-78 as anticipated in the beginning of the year only if the fee is charged at enhanced rate of 3%. Only with the projected income the Board will be able to provide the services envisaged by it to the farmers of the area. The Board allotted works amounting to Rs. 8.53 crores in the year 1976-77, out of which the Board will be able to complete the development works worth Rs. 5.62 crores upto 31st March, 1978, leaving a spill over of Rs. 2.91 crores for the year 1978-79. In addition to this spill- over, Board also anticipated to take new development works amounting to Rs. 3 crores during 1978-79. The projected income during the year 1978-7 9 taking into account the enhanced rate of market-fee will be Rs. 6.20 crores whereas the expenditure will be to the tune of Rs. 8.97 crores including the development works, miscellaneous other services and the cost of establishment. The deficit of Rs. 2.77 crores had to be met by the Board by raising loan from other sources. Thus even this enhanced fee will not be sufficient to meet the expenditure which the Board proposes to incur for the purposes under the Act. Thus the enhancement of market-fee from 2% to 3% is wholly reasonable and justified and has a reasonable correlation with the services rendered or to be rendered."Quoting passages from the earlier judgments of the High Court, it upheld the levy of the fee @ Rs. 3/- per hundred rupees and dismissed all the writ petitions.43. The challenge by the dealers of the Moga Market Committee by Civil Writ Petition No. 2015 of 1978 filed in the Hi gh Court failed as per the judgment of the High Court delivered on 18-5-1978 wherein the Full Bench decision was followed. Special Leave Petition No. 2768 of 1978 has been filed from the said judgment. The purposes enumerated in the Full Bench decision and repeated in this judgment also for the purpose of justifying the increase in the rate of fee from Rs. 2/- to Rs. 3/- per hundred rupees are the stereo-type ones including Rural Integrated Development Scheme, night-shelter, link roads and bridges. Every body seems to have allowed himself to be carried too far by the sentiment of the laudable object of the Act of doing whatever is possible to do under it for the amelioration of the conditions and the uplift of the villagers and the agriculturists. Undoubtedly the Act is primarily meant for that purpose and to the extent it is permissible under the law to achieve that object of utilising the money collected by the market fee, it should be done. But if the la w does not permit carrying on of the sentiment too far for achieving of all the laudable objects under the Act, then primarily it becomes the duty of the Court to allow the law to have an upper hand over the sentiment and not vice versa. We must not be misunderstood to say that we are against the sentiment expressed in the interests of the agriculturists. Nor are we opposed in the least to the achievement of all the laudable objects envisaged under the Act. Let them all be achieved by all means known to law by meeting the expenses after augmenting the public revenue or by diverting the expenditure from wasteful or unimportant channel to the more important one under the Act. But surely we cannot countenance the achievement o f all those objects by utilising a good and substantial portion of the market fee collections when the utilisation goes against the concept of quid pro quo which is very essential in case of fees. As we have already stated Civil Appeal 1616 of 1978 arised from the order of the High Court dated 18-9-1978 dismissing the connected Writ Petition filed by a few hundred dealers of various Market Committees in the State of Punjab challenging the increase of the market fee from Rs. 2/- to Rs. 3/-. Before us in the Writ Petitions not only the increase of the rate from Rs. 2/- to Rs. 3/- has been challenged but the previous increases have also been challenged. For the reasons to be briefly stated hereinafter we do not feel persuaded to interfere with the charging of the market fee Rs. 2/- per hundred rupees by the various Market Committees in the States of Punjab and Haryana. But surely on the facts as they are, the increase of the rate from Rs. 2/- to Rs. 3/- i s not justified in law by any of the Market Committees in either of the twocannot be any doubt that in any scheme of development of Agriculture and marketing in a wide sense, a chain of connections may be found between one activity or the other. It is not only in regard to agriculture but it is so in any other kind of production, distribution and marketing. Our attention was drawn also to the use of the word "secondary" or "indirect" in some of the decisions in relation to the element of quid pro quo. But in our opinion there is a misconception in understanding the true scope of the matter and not drawing the dividing line at the appropriate place for determining the real controversy. Examples of trust cases were given before us that control of the trustees is not for the personal benefit of the trustees but for the beneficiaries, although the liability to pay the fee is of the trustees. The misconception lies in the fact that the impost of fee is not a personal impost on any person in the sense that unconnected with any undertaking or property or the like, it is just an impost on his person. It is not so. When the trustee is charged fee for the benefit of the religious institutions and the beneficiaries it is a benefit to the trustee. Similarly, as pointed out in the Mining Act and the factory cases charge of fee from the mine owners in the area or the factory owners in the factory for the purpose of developing and protecting the mines and the factories is a service to the owners. If one were to push the example of a factory beyond the limit of the conception of fee, one could say that the fee charged from the factory owners can be utilised for pushing end augmenting the output of the raw-materials required in the manufacturing process in the factory, it is also a benefit to the factory owner. Is it reasonably possible to travel as wide as that? Neither the Royal Commission nor the National Commission suggested as to how the integrated development of marketing and the agricultural produce is to be financed. They were not concerned with that aspect of the matter. None can have any objection to the carrying out of the integrated development but it must be carried out by legal means raising the finance in a way known to law.The improvements, checks, controls and regulations must be carried out in the market or in its vicinity. Much of the facilities provided in the market yards or around it will also be for the direct benefit of the producers. But then, being intimately connected with marketing operations the benefit to the producers must be deemed to be special or direct benefit to the traders also. Under the Marketing Rules the auction cannot be conducted by any person other than the person engaged by t he Committee. [Rule 24(5)], and weighments and measurements of agricultural produce intended for sale are to be made through licensed weighments or measures in the principal or a sub-market yard [vide Rule 28(2)]. Reading these Rules in the background of the recommendations of the Commissions, and even otherwise, it is plain they are meant for the protection of the agriculturists. But since they are intimately connected with the marketing operations, just like factory cases, t hey are also meant for the special benefit of the traders. The literal meaning of the phrase "quid pro quo" is "one for the other" meaning thereby-"you charge the fee for the service." Service to the mining area, factory, market or marketing operations are services to the payer of the fee.In a new affidavit of Shri N. S. Bakshi filed in this Court in Civil Appeal 108 3 of 1977 it is stated in paragraph 6 that in the entire Khanna market notified area there is one principal yard; two sub-yards and only two purchase centres and no weighing bridge or any weighing facilities has been provided by the Committee. It is stated in paragraph 7 that "amount of Rs. 3/- lacs lying with the Khanna Market Committee during March, 1978 in Banks was got deposited in the Government Treasury under the orders and directions of the Board." These facts are disputed. But we are merely stating them for the future guidance of the authorities that they should proceed in the matter cautiously keeping in view the law laid down by this Court in earlier cases, such as, Salvation Army case, and in the light of this judgment. In the additional affidavit of Shri K. K. Puri it is stated that from the information gathered it was learnt that the Punjab Board had spent about a crore of rupees by way of subsidy @ 75% for the metallic bins for the use of t he villagers for their domestic use; a crore for air spray; five crores to the Punjab State Electricity Board, one crore given to MARKFED, one and a half crore to Soil Conservation Department and yet nine crores were lying surplus with the various Market Committees. The figure may be exaggerated but are not quite groundless. We are merely quoting them for the future caution of the authorities concerned. Puri has further pointed out in paragraph 17 of his affidavit that in the Estimated Expenditure in the proposed Budget of the Moga Committee for the years 1976-77 and 1977-78 several lakhs of rupees were shown for insecticides and pesticides apart from other inadmissible expenses. We may again pin-point the difference. If insecticides and pesticides are for use at the place where actually the marketing operations are carried on it would be a justifiable expenditure. But if they are meant to be supplied to the agriculturists for use at their village homes or in their fields surely they cannot be valid expenditure out of the collections of the market fee.Mr. Tarkunde filed an abstract of the statement of income from market fee and licence fee and expenditure incurred therefrom by the Market Committee, Hissar as worked out from Annexure R-I to R-V filed in the High Court. It would be seen from this abstract that in the year 1974-75 the income from market fee was Rs. 24, 08, 141/- and from licence fee about Rs. 6, 000/- onl y. A sum of Rs. 7, 89, 670/- was contributed under section 27 of the Act to the Board and a sum of Rs. 14, 73, 732/- was spent on Works including link roads. Similar was the position in the year 1975-76. In 1976-77 income from licence fee was only R s. 16, 000/- and odd and incomes from market fee was Rs. 38, 27, 233 /-. A big c hunk to the tune of Rs. 12, 19, 383/- went as contribution to the Board and Rs. 24, 47, 408/- were spent on works including link roads. Similar abstracts were given in respect of other Market Committees showing exactly the same position. Abstracts were also given to us by Mr. Tarkunde showing the income of the Haryana Board by contribution made by the various Market Committees and the expenditure incurred therefrom. In the abstract statement figures of expenditure both of admissible and inadmissible items had been clubbed together. It is, therefore, not possible to get any correct picture from these abstracts.It is thus a clear admission t hat 65% of the income has gone by way of contribution to the P.W.D. fund for construction of the link roads. It is in substance a contribution to the Public Exchequer for helping the Government Agency in performing its governmental functions and duties. In no way such a contribution can be justified out of the market fee income. From Annexure R-II appended to the aforesaid affidavit of the Board it would be seen that in the year 1974-75 a sum of Rs. 1, 07, 338/- was given as aid to animal husbandry for the uplift of cattle wealth and its product. This illustrates to what extent the concept of fee in lieu of service has been stretched. A sum of Rs. 6, 00, 000/- and odd was spent for improving the quality of cotton seeds for seeds purposes. In a Gober Gas Plant Rs. 15, 55, 000/- were invested. This item was sought to be explained before us by Mr. Tarkunde that this expenditure was incu rred with the help of the subsidy received from the State and the Central Governments. The scheme of the Gober Gas Plant was launched for the promotion of interest of market area. It is not explained as to how it was connected with the marketing operations in the area and how much was the subsidy and what portion of the amount was spent out of the market fee Income. Similarly in Annexure R-III from the statement of income and expenditure of the Haryana Board for the year 1975-76 it would appear that a sum of Rs. 1, 28, 70, 662/- was spent "on general improvement in M.C. and other notified area and construction of F.A.C.C." Apart from that the other items of expenditure are a sum of Rs. 20, 00, 000/- in purchase and acquisition of land for new mandies and Rs. 10, 00, 000/- and odd for purchase of land, construction of building for Boards office and staff quarters in the mandies. Again in this year a sum of Rs. 95, 00, 000/- and odd is shown to have been spent on Gober Gas plant. It may be inclusive of the figure of the earlier year. Then from Annexur e R-IV, the statement for the year 1976-77, it will be found that a sum of rupees one crore was given as loan to Haryana Electricity Board. We have taken some of these items just by way of example to illustrate that the authorities took full liberty to treat the realisation from market fee as a general realisation of tax which they were free to spent in any manner they liked for the purposes of the Act, the development of the area, for giving a filling to agricultural production and so forth and so on. The sooner the authorities are made to realise the correct position in law the better it will be for all concerned.But taking a reasonable and practical view of the matter and on appreciation of the true picture o f justifiable and legal expenditure in relation to the market fee income, even though it had to be done on the basis of some reasonable guess work, we are not inclined to disturb the raising of an imposition of the rate of market fee upto Rs. 2/- p er hundred rupees by the various Market Committees and the Boards both in the State of Punjab and Haryana. After all, considerable development work seems to have been done by many Market Committees in their respective markets. The charging of f ee @ Rs. 2/-, therefore, is justified and fit to be sustained. We accordingly do it. As pointed out earlier the dealers of Haryana did not feel aggrieved when the High Court maintained the raising of market fee to the extent of Rs. 2/- per hundred rupees. We are, however, not inclined to uphold the raising of the fee from Rs. 2/- to Rs. 3/-, as on the materials placed before us it is clear that this has been done chiefly because of the wrong impression of law that the amount of market fee can be spent for any development work in the notified market area and specially for the development of agriculture and the welfare of the agriculturists. On the basis of the facts and figures placed before us from the High Court records and also some new materials filed here we have come to the conclusion that there was no justification in raising the fee from Rs. 2/- to Rs. 3/-. The High Court was wrong in maintaining this rise on an erroneous view of the matter. We, therefore, allow the appeals and the writ Petitions to the extent and in the manner indicated above and direct the Market Committees and the State Marketing Boards not to realize market fee at the rate of Rs. 3/- per hundred rupees on the basis of their impugned decisions and actions which have been found to be invalid by us. We leave the parties to bear their own costs throughoutBefore we part with these cases we would like to observe that in future if the market fe e is sought to be raised beyond the rate of Rs. 2/-per hundred rupees, proper budgets, estimates, balance-sheets showing the balance of the money in hand and in deposit, the estimated income and expenditure, etc. should carefully be prepared in the light of this judgment. It may be, as was submitted before us, that it is not imperative either for the Market Committees or the Board to prepare balance-sheets because their accounts are audited by government auditors but for the purposes of raising the market fee any further, the balance- sheets will give a true picture of the position also with the budgets and estimates. Then, and then only there may be a legal justification for raising the rate of the market fee further to a reasonable extent. On drawing of the correct balance-sheets and framing of the correct estimates and budgets the authorities as also the State Government will be able to know the correct position and to decide reasonably as to what extent the raising of the market fee can be justified taking on overall picture of the matter and keeping in view the reason behind the restrictions of sales tax law concerning the transactions of food-grains and the other agricultural produce.