KEWAL KRISHAN PURI & ANR. versus STATE OF PUNJAB & OTHERS

Citation: [1979] 3 S.C.R. 1217 · Decided: 04-05-1979 · Supreme Court of India · Bench: Y.V. CHANDRACHUD · Disposal: Dismissed
Cited by 15 judgment(s) · cites 10 · see the full citation network in Lexace
Open in Lexace · Ask the AI about this case
Judgment (excerpt)

KEW AL KRISHAN PURI & ANR. 
v. 
STATE OF PUNJAB & OTHERS 
May 4, 1979 
1217 
fY. V. CHANDRACHUD, CJ., P. N. BHAGWATI, N. L. UNTWALIA, 
B 
S. MURTAZA FAZAL ALI AND R. S. PATHAK, JJ.] 
Punjab AgriculJural Produce Mnrkets Act, 1961 Ss. 23, 26 and 28 i: Punjab 
Agricultural Produce (General) Rules, R 29-Marketing Developtt1ent Fttnd & 
fee-ValidiJy-Principlcs for satisfying the test for a valid levy of market fees. 
Punjab Agricultural Produce Markets Act, 1961 Ss. 23. 26 and 28 &: Punjab 
Agricultural Produce (General) Rules, R29-Marketing Development Fund & 
.41<;1'keting Conunittr:e Fund-,-UtilL~ation of market fees---Validity of purpvses 
enumerated in clauses of Ss. 26 and 28 examined. 
The Punjab Agricultural Produce J,1arkets Act, 1961 which \\'as passed by 
the composite State of Punjab is an Act for the better regulation of the purchase, 
sale, storage and proce~sing of agricultural produce and the establishment of 
markets for agricultural produce in the Stnte. 
Section 3 envisages the estab-
lishn1ent of the State Agricultural Marketing Board for the entire State and it 
is provided in sub-sec, (9) that "The Board shall exercise superintendence and 
<'.ontrol over the Committees". 
Section 6(1) provides 
for 
"declaration 
of 
notified 1narket area" and the State Government is empo\\'ered to declare the 
area notified under s. 5 or any portion thereof to be a notified market area 
for the purpose of the Act in respect of the agricultural produce notified under 
s. 5 or any part thereof. The market area<; and n1arket yards \Vere d~clared. 
putting restriction on the traders to carry on their trade under a licence granted 
by the various J\.farkets Committees established amci. constituted within the specified 
boundaries or ureas. 
After the declaration of the nol ified 1narket area no person 
can establish or continue any place for the purchase, sale, storage and processing 
of the a-gricultural produce except under a licence granted in accordance with 
the provisions of the Act, the Rules and the Bye-laws. 
Section 23 empowers 
the committ'ee to levy, the fees subject to such rules as may be made by the 
State Government in thi~ behalf on the agricultural prcxluce broui:ht or sold by 
licensees in the notified market area at a certain percentage. Uader s. 27(1), 
all rnoneys received by a Committee shall be pa.id into a fund to be called the 
Market Committeo Fund and all expenditure incun·ed ~hall be defrayed out of 
such fund, while under s. 25 all receipts of the Board are to be credited iA.to 
a fund to be called the Marketing Development Fund and the purposes for 
\Vhich it mny be expended are enumerated in s. 26 viz. better marketing of 
agricultural produce on co-operative lines, collection and dissemination of market 
rates and news, gr~1ding and standardisalion of agricultural produce etc. 
Section 
28 rntalogues the purposes for which the Marketing Committee Fl.lnd nlay 1--e 
utilised viz. acquisition of sites for the market, maintenan'.:e and improvement 
of the nlaiket, constn1ction a.nd repair of buildings \Vhich are necessary for the 
pt1rp0se of. the n1arkt!t etc. 
Jn the composite State of Punjab and even after the .bifurcation of the State 
for about a period of three years the n1axin1un1 rate of market fee which could 
c 
D 
E 
F 
G 
H 
1218 
SUPREME COURT REPORTS 
[1979] 3 S.C.R. 
A 
be levied br the various market com1nittees under s. 23 was 50 paise for ..:very 
one hundred rupees. 
The fee \ .. .:as therea·fter raised from time to tinie. 
B 
c 
D 
E 
F 
G 
A number of wril petitions werl.! filed in the High Court challenging the 
po"'er of the Board to in..:::rease the levy of fee. 
All the writ petitions were 
heard togeth'er and the in-::rease and levy of fee up!o Rs. 2/- by the various 
Market Committees in the State of Harynna \Vas upheld and the writ petitions 
of the llaryana dea·lers were dis1nisscd while tho.'e of the Punjab dealers were 
allowed and thei increase of rate brought about by Act 13 of 1974 to the extent 
of Rs, 2.25 WM struck down. 
[Mjs. Hanunzan Dall & General Mills, His01· v. 
State of Haryana & others AIR 1976 P & H l] 
Jn Punjab, by C:•!nendn1ent .Act 14 of 1975, s. 23 of the Act \.Vas again 
amended authorising the imposition of market fee at a 
rate 
not exceeding 
Rs. 2.20 per hundred rupees only, and this increa~e in the rates of fee was 
agaifl challenged in the High Court and a Full Bench upheld the increase. [Kewal 
Kri.d1an Puri & Anr. v. State of P1111j
Excerpt shown. Read the full judgment & AI analysis in Lexace.