APMC YASHWANTHAPURA THROUGH ITS SECRETARY versus M/S. SELVA FOODS THROUGH ITS MANAGING PARTNER

Citation: [2021] 12 S.C.R. 284 · Decided: 14-12-2021 · Supreme Court of India · Bench: R. SUBHASH REDDY · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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SUPREME COURT REPORTS
[2021] 12 S.C.R.
APMC YASHWANTHAPURA THROUGH ITS SECRETARY
v.
M/S. SELVA FOODS THROUGH ITS MANAGING PARTNER
(Civil Appeal No. 7706 of 2021)
DECEMBER 14, 2021
[R. SUBHASH REDDY AND SANJIV KHANNA, JJ.]
Karnataka Agricultural Produce Marketing (Regulation and
Development) Act, 1966: s.65 – Respondent purchased spices from
outside the State of Karnataka and after importing, sold the
processed goods within the market areas of the appellant-committee
– Imposition of market fee on the respondent – Correctness of –
Held: A harmonious reading of s.65(2) of the Act, its second proviso,
and explanation to the same and clause (2-A)(ia), makes it clear
that if any dealer imports agricultural produce from outside the
State into any market area within the State of Karnataka for the
purpose of processing and sale, the applicability of second proviso
to sub-section (2) of s.65 of the Act, exempting levy of market fee,
stood excluded – The explanation to sub-section (2) of s.65 of the
Act, makes it clear that even the processed items from the agricultural
produce imported from outside the State of Karnataka, attract market
fee on sales within the market area of the appellant-Committee – It
is also clear from the said Section that it is the obligation of the
importer to realise the market fee from the purchaser and pay the
same to the Market Committee – It is the sale within the market area
that attracts levy of market fee, and not the first purchase that was
outside the market area – Notably the goods sold are also notified
agricultural produce specified in the Schedule – Respondent is not
entitled to claim exemption from payment of market fees.
Allowing the appeal, the Court
HELD: 1. The respondent is a trader as defined under
provisions of the Act and has purchased spices, which are notified
as agricultural produce, not only from market areas within the
State of Karnataka but also from outside the State of Karnataka.
After such imports, they process the goods and sell the processed
goods within the market area. Even the processed goods are
notified items as per the schedule under the Act. [Para 11]
[291-C-D]
[2021] 12 S.C.R. 284
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2. A reading of Section 65 of the Act, which is the charging
section shows that the Market Committee shall levy and collect
the market fees from every buyer in respect of agricultural
produce bought by such buyer in the market area, at such rate as
may be specified in the bye-laws. As per the second proviso to
Section 65(2) of the Act, if on any agricultural produce, market
fee has already been levied and collected under sub-Section (2)
in any market area within the State and such agricultural produce
is processed and sold in any other market area within the State
or exported outside the State, it shall be exempted from the levy
of market fee. However, a reading of the explanation, makes it
clear, the applicability of second proviso excluded to any
agricultural produce imported from outside the State and
processed and sold in any market area within the State; or any
other agricultural produce imported or caused to be imported by
any person either on his own account or as an agent for another
person, from outside the State into any market area within the
State for the purpose of processing or manufacturing except for
one’s own domestic consumption. Further, as per Section (2-
A)(ia), if the produce is sold by an importer to the purchaser, the
importer to realise the market fee from the purchaser and shall
be liable to pay the same to the committee. A harmonious reading
of the Section 65(2) of the Act, its second proviso, and explanation
to the same and clause (2-A)(ia), makes it clear that if any dealer
imports agricultural produce from outside the State into any
market area within the State of Karnataka for the purpose of
processing and sale, the applicability of second proviso to sub-
section (2) of Section 65 of the Act stands excluded. The
explanation to sub-section (2) of Section 65 of the Act, makes it
clear that even the processed items from the agricultural produce
imported from outside the State of Karnataka, attract market fee
on sales within the market area of the appellant – Market
Committee. It is also clear from the aforesaid Section, it is the
obligation of the importer to realise the market fee from the
purchaser and pay the same to the Market Committee.
[Para 12][291-E-H; 292-A-D]
APMC YASHWANTHAPURA THROUGH ITS SECRETARY v. M/

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