CHINT RAM RAM CHAND AND ORS. versus STATE OF PUNJAB

Citation: [1996] 2 S.C.R. 283 · Decided: 08-02-1996 · Supreme Court of India · Bench: B.P. JEEVAN REDDY · Disposal: Dismissed

Judgment (excerpt)

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CHINT RAM RAM CHAND AND ORS. 
A 
v. 
STATE OF PUNJAB 
FEBRUARY 8, 1996 
[B.P. JEEVAN REDDY AND B.N. KIRPAL, JJ.] 
B 
Punjab Agticultural Produce Markets Act, 1961 : Sections 6 and 7 : 
Agticultural Produce-Ma1ket yard-Shifting of-Existing licensed commis-
sion agents/dealers directed to shift to new Mandi--Plots in the new market 
yard sold by auction-Auction sale challenged-Allotment of altemative sites C 
in new market claimed-Held : challenge not sustainable and no right to 
claim allotment of altemative sites-Not violative of Articles 14, 19(1)(g) and 
21 of the Constitution of India. 
Punjab Agticultural Produce Markets (General) Rules, 1962 : Rule 
17(5}-Disposal of property-Sale by auction--One of the fairest D 
means-Gives equal opp01tunity to all sections of public to bid. 
The State under Section 7 of the Punjab Agricultural Markets Act, 
1961 declared a new grain market and the old Mandi was denotified as the 
principal market yard. By another notification the new Mandi was E 
declared as the Principal Market yard. This was followed by a notification 
whereby it was directed that no transaction in agricultural produce would 
be transacted within 5 K.Ms. of the new Mandi. The appellants were 
licensed commission agents carrying on business of sale and purchase of 
agricultural produce and having shops in the old Mandi. They were 
directed to shift to the new Mandi, for the purpose of conducting the 
business of sale and purchase of agricultural produce. In the new Mandi, 
plots were sold by auction for shops. 
The appellants had applied to the State Government for allotment 
F 
of alternative sites in the New Mandi on no profit no loss basis, which was G 
rejected. The appellants filed a writ petition in the High Court challenging 
the auction sale which was dismissed. Aggrieved by the High Court's 
judgment the appellants preferred the present appeal. 
On behalf of the appellants it was contended that alternative sites 
should be allotted to them at concessional rates or on lease; that the State H 
283 
284 
SUPREME COURTilEPORTS 
[1996] 2 S.C.R. 
A 
was duty bound to provide to them a place to do business in the New 
Mandi; that without such provision having been made, the old Mandi 
cannot be stopped; that the State could not adopt a procedure of allotment 
in.the New Mandi by which they could be thrown out of business altogether 
by forcing them to compete with outsi.ders; and that non-allotment of 
alternative sites to them was violative of Articles 14, 19(1)(g) and 21 of the 
B 
Constitution of India. 
Dismissing the appeal, this Court, 
HELD : 1. In the State all the sites are allotted by public auction. 
C This gives an opportunity to all the existing licenced dealers, and also to 
the new entrants, to compete and obtain sites in the new Mandi. Therefore, 
all the existing licenced dealers who may be having a place of business in 
the old Mandi do have a right to acquire by auction sites at the new place 
of business in the new Mandi. [292-H; 293-A] 
D 
2.1. The Scheme of the Act and the Rules framed thereunder show 
that shifting of the Mandi from one place to another, without providing 
for an alternative site or a shop to a licenced dealer, cannot violate any 
statutory or fundamental right of any of the licensees. [293-D-E] 
2.2. A dealer is granted a licence under Section 10 of the Punjab 
E Agricultural Markets Act, 1961 which allows him to carry on business in 
a notified market area. A dealer having one place of business in a notified 
area is required to have only Qne licence which would entitle him to carry 
on business in any of the Mandies situated in that notified area but, if he 
has more than one place of business, then for each place he is obliged 
F 
under Rule 17(5) of the Punjab Agricultural Produce Markets (General) 
Rules, 1962 to have a separate licence. Neither the Act nor the Rules 
requires that the place of business of a licenced dealer must be within the 
precincts of the Mandi. All that the Act and the Rules require is that the 
auction for the sale and purchase of agricultural produce shall be within 
G the notified market yard or sub-yard. The appellants and other licensees 
wh~ are already having shops or plots in the old Mandies have not been 
deprived of the same; nor are they prevented, in any manner, from carrying 
on in their shops their trade or business other than that of purchase and 
sale of agricultural produce in public auction. The sale of agric

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