Case: Jan Mohammad Noor Mohammad Begban Vs. State of Gujarat &amp; Another

of the period of office of the members and the constitution of a fresh committee after elections. The lawful authority of the members of the market committee was, notwithstanding the expiry of the period, extended by Sub-s. (3A) till the date of the first general meeting of the market committee.19. It may be noticed that there has been no deliberate refusal to hold elections. The period of the market committee was to end on September 18, 1961 and before that date the Collector of Ahmedabad had taken steps to hold elections to the market committee, but as a petition was pending in this Court challenging the vires of the Act the elections could not be held. This Court declared certain provisions earlier referred to as invalid and an Ordinance had to be issued modifying or validating those provisions of the Act. That Ordinance was later replaced by The Bombay and Saurashtra Agricultural Produce Markets (Gujarat Amendment and Validating Provisions) Act 21 of 1961. The Constitutional validity of Act 22 of 1939 as amended by Gujarat Act 21 of 1961 was again challenged before this Court and the elections had further to be postponed. This Court upheld the validity of the impugned provisions by judgment dated March 15, 1962: see Mohammadbhai Khudabux Chhipa v. State of Gujarat, 1962 Supp (3) SCR 875: (AIR 1962 SC 1517 ). Steps were again taken to hold elections, but in the meanwhile a declaration of emergency was made by the President, and Ordinance 11 of 1962 was issued by the Governor of Gujarat in exercise of the powers conferred upon him by the Constitution by virtue of which under S. 3 the term of office, inter alia, of the members of the local authority was extended for a period during which the proclamation of emergency was in force and thereafter for a period not exceeding six months. The market committee constituted or deemed to be constituted under the Bombay Agricultural Produce Markets Act 22 of 1939 was included in the definition of the term "local authority" under the said Ordinance. This Ordinance was substituted by The Gujarat Local Authorities (Extension of Term) Act, 1962. That Act was repealed by The Gujarat Local Authorities (Extension of Term) (Repeal) and the Gujarat Panchayats (Amendment) Act 35 of 1963, by the operating of which the terms of members of local authorities were to stand extended upto the end of March 1964 or such earlier date as the State Government or a person authorised by it may by notification in the Official Gazette specify. Thereafter the Gujarat Local Authorities (Further Extension of Term) Act 9 of 1964 was enacted. By that Act the term was extended upto March 1965 by S. 2 thereof.In the meanwhile the Gujarat Act 20 of 1964 being the Gujarat Agricultural Produce Markets Act was enacted and was brought into force and by virtue of S. 64 thereof the market committee established under the earlier Acts was deemed to be a market committee established for the said market under the new Act and members of the market committee holding office immediately before the commencement of the new Act continued to hold office under the new Act. The contention that there is no legally constituted market committee has therefore no force.20. Finally, the validity of the rules framed under the Bombay Act 22 of 1939 was canvassed. By S. 26(1) of the Bombay Act the state of Government was authorised to make rules for the purpose of carrying out the provisions of the Act. It was provided by Sub-s. (5) that the rules made under S. 26 shall be laid before each of the Houses of the Provincial Legislature at the session thereof next following and shall be liable to be modified or rescinded by a resolution in which both Houses concur and such rules shall, after notification in the Official Gazette, be deemed to have been modified or rescinded accordingly. It was urged by the petitioner that the rules framed under the Bombay Act 22 of 1939 were not placed before the Legislative Assembly or the Legislative Council at the first session and therefore they had no legal validity. The rules under Act 22 of 1939 were framed by the Provincial Government of Bombay in 1941. At that time there was no Legislature in session, the Legislature having been suspended during the emergency arising out the World War II. The session of the Bombay Legislative Assembly was convened for the first time after 1941 on May 20, 1946 and that session was prorogued on May 24, 1946. The second session of the Bombay Legislative Assembly was convened on July 15, 1946 and that of the Bombay Legislative Council on September 3, 1946 and the rules were placed on the Assembly Table in the second session before the Legislative Assembly on September 2, 1946 and before the Legislative Council on September 13, 1946.Section 26(5) of Bombay Act 22 of 1939 does not prescribe that the rules acquired validity only from the date on which they were placed before the Houses of Legislature. The rules are valid from the date on which they are made under S. 26(1). It is true that the Legislature has prescribed that the rules shall be placed before the Houses of Legislature, but failure to place the rules before the Houses of Legislature does not affect the validity of the rules, merely because they have not been placed before the Houses of Legislature. Granting that the provisions of Sub-s. (5) of S. 26 by reason of the failure to place the rules before the Houses of Legislature were violated we are of the view that Sub-s. (5) of S. 26 having regard to the purposes for which it is made, and in the context in which it occurs, cannot be regarded as mandatory. The rules have been in operation since the year 1941 and by virtue of S. 64 of the Gujarat Act 20 of 1964 they continue to remain in operation.21.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]But assuming that such a power is conferred, we fail to appreciate how solely on that account it can be said that the provisions of the Act infringe Art. 19(1) (g) of the Constitution or may be regarded as conferring an arbitrary authority. Reasonable restrictions on the right of a citizen to carry on trade - retail as well as wholesale - may be placed by legislation. The test of the validity of the restrictions lies in the nature of the restrictions and not in the nature of trade. If regulation of trade in agricultural produce by the declaration of market area and imposition of restrictions may be regarded as reasonable when operating on the wholesale trade, it would be difficult to hold that the identical restrictions when operating on retail trade may be deemed unreasonable. We do not think that the observations made by this Court in Mohammad Hussains case, (1962) 2 SCR 659  : (AIR 1962 SC 97  ), justify the argument urged by the petitioner. Challenge to the validity of Ss. 5 and 6 must thereforeprovisions with regard to information and report to the market committee about the resale of the agricultural produce and the prohibition of sales otherwise than by open auction or by open agreement clearly indicate that R. 60 does not deal with retail sales.The learned Solicitor-General appearing on behalf of the State of Gujarat has conceded, and we think that the concession is rightly made, that the Act read together with the rules does not purport to place any restriction upon retail transactions in agricultural produce. Therefore no licence is required under the Act for carrying on retail trade in agricultural produce in the market area, and there is no prohibition against the carrying on of retail sale in agricultural produce in the market area.15.The argument that S. 27(2) does not provide fee in excess of the (sic) maximum licence fee may not be charged by the market committee is also without substance. In terms Sub-s. (2) provides that the licences may be granted in such forms, for such periods, on such terms and conditions and restrictions as may be prescribed or determined by the bye-laws and on payment of fees determined by the market committee within such maxima as may be prescribed. That clearly contemplated fixation of maxima by the rules made under S.market committee constituted or deemed to be constituted under the Bombay Agricultural Produce Markets Act 22 of 1939 was included in the definition of the term "local authority" under the said Ordinance. This Ordinance was substituted by The Gujarat Local Authorities (Extension of Term) Act, 1962. That Act was repealed by The Gujarat Local Authorities (Extension of Term) (Repeal) and the Gujarat Panchayats (Amendment) Act 35 of 1963, by the operating of which the terms of members of local authorities were to stand extended upto the end of March 1964 or such earlier date as the State Government or a person authorised by it may by notification in the Official Gazette specify. Thereafter the Gujarat Local Authorities (Further Extension of Term) Act 9 of 1964 was enacted. By that Act the term was extended upto March 1965 by S. 2 thereof.In the meanwhile the Gujarat Act 20 of 1964 being the Gujarat Agricultural Produce Markets Act was enacted and was brought into force and by virtue of S. 64 thereof the market committee established under the earlier Acts was deemed to be a market committee established for the said market under the new Act and members of the market committee holding office immediately before the commencement of the new Act continued to hold office under the new Act. The contention that there is no legally constituted market committee has therefore nosession of the Bombay Legislative Assembly was convened for the first time after 1941 on May 20, 1946 and that session was prorogued on May 24, 1946. The second session of the Bombay Legislative Assembly was convened on July 15, 1946 and that of the Bombay Legislative Council on September 3, 1946 and the rules were placed on the Assembly Table in the second session before the Legislative Assembly on September 2, 1946 and before the Legislative Council on September 13, 1946.Section 26(5) of Bombay Act 22 of 1939 does not prescribe that the rules acquired validity only from the date on which they were placed before the Houses of Legislature. The rules are valid from the date on which they are made under S. 26(1). It is true that the Legislature has prescribed that the rules shall be placed before the Houses of Legislature, but failure to place the rules before the Houses of Legislature does not affect the validity of the rules, merely because they have not been placed before the Houses of Legislature. Granting that the provisions of Sub-s. (5) of S. 26 by reason of the failure to place the rules before the Houses of Legislature were violated we are of the view that Sub-s. (5) of S. 26 having regard to the purposes for which it is made, and in the context in which it occurs, cannot be regarded as mandatory. The rules have been in operation since the year 1941 and by virtue of S. 64 of the Gujarat Act 20 of 1964 they continue to remain in operation.