VISHNU DAYAL MAHENDRA PAL AND OTHERS versus STATE OF UTTAR PRADESH AND ANOTHER

Citation: [1975] 1 S.C.R. 376 · Decided: 01-05-1974 · Supreme Court of India · Bench: A.N. RAY · Disposal: Dismissed

Judgment (excerpt)

376 
VISHNU DAYAL MAHENDRA PAL AND OTHERS 
v. 
STATE OF UTTAR PRADESH AND ANOTHER 
May, 1, 1974 
[A. N. RAY, C.J., K. K. MATHEW, A. ALAGffiISWAMY, P. K. GOSWAMI 
AND R. S. SARKARIA, JJ.] 
Uttar Pradesh Krishi Utpadhan Mandi Adhiniya1n, 1964 and Rules made 
thereunder-If violative of Arts. 14 and 19(1){g) of the Constitution. 
The Uttar Pradesh Krishi Utpadhan Mandi Adhiniyam, 1964 as amended 
by U.P. Acts 25 of 1964 and 10 of 1970. was enacted 
to provide for the 
regulation of the sale and purchase of agricultural produce, to protect 
the 
producers from exploitation and for the establishment, superintendence and 
control of markets in U.P. Under s. 5, the State Government is empowered 
to declare a particular area as market area and under s. 7 the principal market 
yard and sub-market yards are declared. 
Section 
7(2) 
provides 
that 
no 
person shall, in a principal market yard or sub-market yard carry on business 
as a trader, broker, commission agent etc., in respect of specified agricultural 
produce except in accordance with the conditions or a licence obtained from 
the concerned market committee. Sec. 13 provides for the constitution of the 
market committee and for representation on the committee from different 
SQ.urces. 
Under s. 17. the committee has power to issue, renew, suspend . 
or ·cancel licences. Section 25 provides for appeals against orders of the 
committee to the Director of Agriculture and s. 32 for revision by the State 
Government. Under s. 16(2) (vii), the !:.ommittee has to provide accommci· 
dation for storage. Sec. 40 enables the State Government to make rules. 
Rule 70(4)(i)provides that the Committee may issue a licence to an applicant 
if it is satisfied (a) that the applicant is solvent and (b) that the applicant 
is a desirable person. Rule 
76( 1) 
provides 
that 
every 
consignment 
of 
specified agricultural produce brought for sale into the principal or sub-market 
yard shall be sold by open auction. 
The petitioners who were traders or commission agents, dealing fn agricul · 
tural produce, challenged the validity of the Act, and the rules made there-
under on the ground of violation Of Arts. 14 and 19(l)(g). 
A 
B 
c 
D 
E 
They contended that : ( 1) that constitution of the con1mittee is prejudi· 
cial to their interests since. it will have a perpetual majority of producers, (2) 
the entrustment of Jicensing to such a committee is an unreasonable restriction 
on their right to trade, (3) there is no guidance in the matter of grant of 
licences, the criteria mentioned in r. 70(4) being vague, (4) the requirement to 
F 
provide storage space for Jhe producers by the petitioners is an unreasonable 
restriction, and (5) r. 76(1) is u/U-a vires s. 40 and also places an unreason-
able restriction on the petitioners. 
Dismissing the petitions~ 
, 
HELD :-(1) Under s. 13 the Committee is to consist of 23 members and 
,, 
out of them only 10 are ffom the producers. Therefore the submission is 
factually inaccurate as there is no question of a perpetual majority of pro-
G 
~ 
dacers. [381G·HJ 
(2) There are no unreasonable features in the scheme of representation 
~ 
in the committee. Under s. 13, 8 producers are elected who may represent 
the 8 categories of agricultural produce mentioned in the schedule and two 
producers are nominated frofu tlie schedule castes by the Government, be· 
cause, they may not . get due representatk!n in the electi'!n .. The perf~rpiance 
of the duty of licensing by such a committee cannot ~reJudicc the petitioners. 
ll 
In fact, none of the petitioners has been refused a licence. 'Th<?ugh ?-sually 
some governmental authority is charged with the duty of granting licences 
under various Acts, that does not prove that L~e duty_ c:J.nn_ot be prope;ly and 
impartially exercised by a Committee representing various interests which are 
• 
A 
B 
c 
VISHNU DAYAL v. u. P. STATE (Goswami, J.) 
371 
vitally interested in the trade of agricultural produce. If in a partiCular case. 
the action of the Committee is rvala fide or otherwise objectionable such n 
grievance can be properly dealt with. [381H-382E] 
(3) It is not correct to say that there is no guidance in the Act in the 
matter of grant of license and that the two criteria provided by rule 70(4)(i) 
are vague. [382E-F] 
(a) The Committee which is entrusted with the duty of granting licences 
consists of people from different sources vitally interested in the marketing of 
agricultural produce, as well as

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