IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY, THE SEVENTEENTH DAY OF OCTOBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE MR JUSTICE GODA RAGHURAM and THE HON'BLE MR JUSTICE P.V.SANJAY KUMAR WRIT PETITION NO : 15913 of 2000 Between: Sri Vijayarama Gajapathi, Co-operative Sugars Limited, Bhimasingi, Rep. by its Managing Director, Rama Gangi Reddy, Vizianagaram District. ..... PETITIONER AND 1 Agricultural Market Committee, Kothavalasa. 2 State of Andhra Pradesh, Rep. by Secretary of Agricultural & Co-operation, Hyderabad. .....RESPONDENT(S) Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to to issue Writ of Mandamus or any other appropriate writ or order or direction, (i) declaring Item 65 of Schedule II to the A.P. Agricultural Markets Act, 1966 as illegal, arbitrary and ultravires A.P. Sugar Cane Act, 1961 (ii) declare that the provisions of A.P.Agricultural Markets Act, 1966 has no application to sugarcane and consequently set aside the communication dt. 16.6.2000 issued by the Respondent No.1 and interdict the respondents from recovering market fee on the transactions relating to purchase of sugarcane (ii) interdict the respondent No.1 from prosecuting the petitioner U/s. 23(1) of A.P. Agricultural Produce and Live Stock Markets Act, 1966 and pass such other order or orders as this Hon'ble Court may deem ﬁt and proper in the circumstances of the case. Counsel for the Petitioner:MR.P.VASUDEVA REDDY Counsel for the Respondent No.: GP FOR AGRICULTURE The Court made the following : THE HON’BLE SRI JUSTICE G.RAGHURAM AND THE HON’BLE SRI JUSTICE P.V.SANJAY KUMAR WRIT PETITION NO.15913 OF 2000 ORDER: (Per Hon’ble Sri Justice P.V.Sanjay Kumar) The issue falling for consideration in this writ petition is whether the provisions of the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966 (for brevity ‘the Act of 1966’) are applicable to Sugarcane and more speciﬁcally, whether Agricultural Market Committees can collect market fee under Section 12(1) of the said Act upon the purchase of Sugarcane by sugar factories, within the market area. The petitioner, Sri Vijayarama Gajapathi Co-operative Sugars Limited, Bhimasingi, Vizianagaram District, is a Co- operative Sugar Factory registered under the provisions of the A.P. Co-operative Societies Act, 1964 and purchases Sugarcane for manufacture of sugar. The petitioner is aggrieved by the issuance of the proceedings in R.C.No.166/SR.II/99 dated 16.06.2000 by the Oﬃce of the Agricultural Market Committee, Kothavalasa, the ﬁrst respondent in the writ petition, calling upon it to remit a sum of Rs.30,70,269/- towards market fee payable under Section 12(1) of the Act of 1966 on it’s purchase of sugarcane during the period 1994-95 to 1997-98. This writ petition is ﬁled, contending inter alia that the provisions of the Act of 1966 have no application to Sugarcane and seeking a declaration that Item No.65 of Schedule-II of the Act of 1966, naming Sugarcane as one of the items under the heading “Agricultural Group”, is illegal, arbitrary and ultra vires the Andhra Pradesh Sugarcane (Regulation of Supply and Purchase) Act, 1961 (for brevity ‘the Act of 1961’). The petitioner also seeks a consequential direction to set aside the proceedings dated 16.06.2000 issued by the ﬁrst respondent and to interdict the respondents from recovering the market fee allegedly due in respect of these transactions and from prosecuting the petitioner under Section 23(1) of the Act of 1966. The petitioner contends that the Act of 1961 is a comprehensive legislation enacted by the State Legislature covering all the facets relating to production and marketing of Sugarcane and in the light of this special enactment, the general enactment, being the Act of 1966 stood excluded insofar as Sugarcane is concerned. In this regard, it is also pointed out that G.O.Ms.No.28, Agricultural and Co-operation (MRTG-II) Department, dated 03.02.1999 was issued by the Government of Andhra Pradesh itself, proposing amendment of the Act of 1966 by omitting Sugarcane at Item No.65 under the heading “Agricultural Group” in Schedule-II of the Act of 1966. It is alleged that the ﬁrst respondent-Market Committee issued notices to the petitioner in respect of the ﬁnancial years 1994-95, 1995-96, 1996-1997 and 1997-98 calling upon it to furnish monthly purchase returns in respect of the Sugarcane purchased during the period stipulated in the notices. The petitioner claims to have responded to the said notices on 22.07.1999, relying upon G.O.Ms.No.28 dated 03.02.1999 and denying legal obligation to comply with the provisions of the Act of 1966 insofar as Sugarcane is concerned. It is further stated that the ﬁrst respondent-Market Committee, without passing any Assessment Order determining the alleged liability of the petitioner in respect of the market fee allegedly payable for purchase of Sugarcane, issued the proceedings dated 16.06.2000 demanding payment of Rs.30,70,269/- towards market fees for the ﬁnancial years 1994-95 to 1997-98. According to the Petitioner, the 1 st Respondent Market Committee was of the opinion that G.O.Ms.No.28, dated 03.02.1999 would only apply prospectively and the Petitioner would be liable to pay market fee under the Act of 1966 for the period anterior to the said G.O. Neither of the respondents in the writ petition have ﬁled a counter-affidavit. Heard Sri P.Vasudeva Reddy, learned counsel for the petitioner, Sri K.Madhava Reddy, learned Standing Counsel appearing for the ﬁrst respondent-Market Committee and the learned Government Pleader for Agriculture appearing for the second respondent. It is brought to our notice that the preliminary notiﬁcation under G.O.Ms.No.28 dated 03.02.1999 proposing amendment of the Act of 1966, by deleting Sugarcane at Item No.65 under the heading “Agricultural Group” in Schedule-II of the Act of 1966 culminated in a ﬁnal notiﬁcation promulgated under G.O.Ms.No.372 dated 31.08.2002, whereby Sugarcane stands excluded from the purview of the Act of 1966. The issue in the present case, however, is with regard to the validity of the demand raised by the ﬁrst respondent for the ﬁnancial years 1994-95 to 1997-1998 and more particularly, the applicability of the Act of 1966 to Sugarcane during the said period. The learned Standing Counsel appearing for the ﬁrst respondent-Market Committee fairly conceded that the matter is no longer res integra in the light of the Judgment of a Constitution Bench of the Supreme Court in BELSUND SUGAR CO. LTD. v. STATE OF BIHAR [1]. In the said case, the Supreme Court was seized of the issue of collection of market fee by the Market Committees in exercise of their powers under the Bihar Agricultural Produce Markets Act, 1960 in respect of Sugarcane and various other products. With regard to Sugarcane, the Supreme Court framed a speciﬁc issue as to whether the Market Act would apply to transactions of purchase of Sugarcane in the light of the Bihar Sugarcane (Regulation of Supply and Purchase) Act, 1981 and the Sugarcane (Control) Order, 1966 issued under Section 3 of the Essential Commodities Act, 1955. Upon a comprehensive analysis of the statutory provisions and judicial precedents, the Supreme Court, applying the maxim ‘Generalibus Specialia Derogant’, held that the special enactments, being the Sugarcane Act and the Sugarcane (Control) Order would prevail over and exclude the general legislation, viz., the Market Act, insofar as the commodity Sugarcane was concerned and accordingly the Market Committees would have no authority to collect market fee upon sale and purchase of Sugarcane under the Market Act. Another contention raised by the Petitioner is to the eﬀect that the ﬁrst Respondent could not collect market fee from it without establishing that it had rendered services to the Petitioner on a quid pro quo basis. This aspect has also been considered by the Supreme Court in the aforesaid decision. In this connection, the Supreme Court held that the point was not whether the services rendered by the Market Committees to the sugar factories were adequate quid pro quo but rather, that the Market Committees were not statutorily required to make available such services to the sugar factories which were covered by the special enactments that were comprehensive and complete in themselves. In the present case also, the State enacted a special legislation, viz., the Andhra Pradesh Sugarcane (Regulation of Supply and Purchase) Act, 1961 covering all facets of the production and marketing of Sugarcane. Further, the Sugarcane (Control) Order, 1966 issued under Section 3 of the E.C. Act also applied. Thus, the general legislation, being the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966 necessarily stood excluded to the extent the special legislations covered the ﬁeld. The ﬁrst respondent-Market Committee, therefore could not have exercised jurisdiction under the provisions of the Act of 1966 insofar as Sugarcane is concerned. In the light of the aforesaid judgment, notwithstanding the inclusion of Sugarcane at Item No.65 in Schedule-II of the Act of 1966, the ﬁrst respondent-Market Committee did not have the authority or power to apply the provisions of the Act of 1966 and collect market fee in respect of the purchase of Sugarcane by the petitioner even during the period prior to the deletion of Sugarcane from the purview of the Act of 1966. The Supreme Court also made it clear that its ﬁnding with regard to non-applicability of the Market Act to the transactions relating to sale/purchase of Sugarcane would only be attracted to cases of Sugar Factories functioning in the areas of Market Committees, which were governed by the provisions of the Sugarcane (Control) Order, 1966 and the State’s Sugarcane Act. The reasoning and the ratio of the Supreme Court in BELSUND’s case (1 supra) squarely apply on all fours to the facts and issues in the present case. For the reasons aforestated, there shall be a declaration that the provisions of the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966 have no application to Sugarcane purchased by the Sugar Factories, such as the petitioner, and consequently the proceedings dated 16.06.2000 issued by the ﬁrst respondent are set aside. The writ petition is accordingly allowed. No costs. _________________ G.RAGHURAM, J. _________________________ P.V.SANJAY KUMAR, J. 17th OCTOBER, 2008. VGSR [1] (1999) 9 SCC 620