CWP No. 1473 of 2009. Case: Sukhjit Starch and Chemicals Ltd. Vs The Agriculture Produce Market Committee. Himachal Pradesh High Court
| Case Number | CWP No. 1473 of 2009 |
| Counsel | For Appellant: Arjun K. Lal, Advocate and For Respondents: Navlesh Verma, Advocate |
| Judges | Ajay Mohan Goel, J. |
| Issue | Central Sales Tax Act, 1956 - Sections 2, 7(1), 7(2); Constitution of India - Article 226; Himachal Pradesh Agricultural and Horticultural Produce Marketing (Development and Regulation) Act, 2005 - Sections 19, 2, 2(a), 2(zg), 2(zo), 27, 29, 40, 41, 44, 44(i), 44(ii), 71 |
| Judgement Date | March 29, 2017 |
| Court | Himachal Pradesh High Court |
Judgment:
Ajay Mohan Goel, J.
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By way of this writ petition, the petitioner has inter alia prayed for issuance of directions to the respondent-Committee not to call upon the petitioner-Company and/or its manufacturing unit to register itself under the provisions of Section 40 of the Himachal Pradesh Agricultural & Horticultural Produce Marketing (Development and Regulation) Act, 2005 and for issuance of a mandamus to the effect that the petitioner-Company and/or its manufacturing unit is not required to pay any market fee to the respondent qua its manufacturing activities being carried out through its manufacturing unit known as Sukhjit Agro Industries at Village Gurplah, Tehsil Haroli, District Una. Petitioner has also prayed for a direction to the respondent Market Committee not to raise any demand of market fee from the petitioner-Company and/or its manufacturing unit, i.e., Sukhjit Agro Industries at Village Gurplah, Tehsil Haroli, District Una and also for a direction to the respondent Market Committee to refund a sum of ` 22,52,535/- alongwith interest @11.5% per annum from 25th October, 2007 to the petitioner-Company which has been realized from the petitioner-Company illegally by the respondent-market committee on account of market fee.
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The case of the petitioner-Company is that it is a Company incorporated under the provisions of the Indian Companies Act, 1956 and is having several manufacturing units including a unit, i.e. Sukhjit Agro Industries at Village Gurplah, Tehsil Haroli, District Una, Himachal Pradesh. As per the petitioner, its manufacturing unit, i.e. Sukhjit Agro Industries is exclusively engaged in the business of manufacture of Liquid Glucose, Dextrose, Monohydrate, Liquid Malto Dextrine, Malto Dextrine Powder, Maize Glutane, Maize Germ and Maize Husk out of Maize at Village Gurplah, Tehsil Haroli, District Una. It is further the case of the petitioner-Company that its aforesaid unit is registered under the Central Sales Tax (Registration Turnover) Rules, 1957 and the said unit is also registered under the Himachal Pradesh General Sales Tax Act, 1970 and certificates issued in this regard by the authorities demonstrate that the business of the unit is manufacturing of Maize Starch, Liquid Glucose, Dextrose, Monohydrate, Liquid Malto Dextrine, Malto Dextrine Powder, Maize Glutane, Maize Germ and Maize Husk out of Maize. It is further the case of the petitioner that General Manager, District Industries Centre, District Una has also issued a certificate in Form-1 for the year 2007-2008 in favour of the petitioner-Company, dated 23.09.2008 (Annexure-PE), wherein it has been certified that Sukhjit Agro Industries is a manufacturing unit of Sukhjit Starch and Chemicals Ltd. for the manufacture of Liquid Glucose, Dextrose, Monohydrate, Liquid Malto Dextrine, Malto Dextrine Powder, Maize Glutane, Maize Germ and Maize Husk out of Maize. On these bases, it has been contended by the petitioner-Company that the Company and its unit in issue is only engaged in the manufacture of abovementioned items alone and it is not engaged in any activity which could be said to be covered by the provisions of Section 40 of the Himachal Pradesh Agricultural & Horticultural Produce Marketing (Development and Regulation) Act, 2005 and none of the manufacturing activities being carried out by the unit of the petitioner-Company attract the necessity of registration under the provisions of the Himachal Pradesh Agricultural & Horticultural Produce Marketing (Development and Regulation) Act, 2005. It is further the case of the petitioner-Company that its unit is not engaged in the processing of any agriculture produce in District Una and that the petitioner-Company at no point of time has operated in the past, neither it is operating in the market area as a trader, commission agent, weighman, hamal, surveyor, ware houseman, contract farming sponsor, owner or occupier of a processing factory or any other market functionary. Further, as per the petitioner-Company, its unit is not engaged in the business of "Processing" as defined in Section 2(zg) of the Act nor the unit is engaged in the business of processing any agricultural product or a scheduled item under the Act and thus the provisions of Section 44 of the Act are not attracted as far as the petitioner or its unit is concerned. As per the petitioner, in its mistaken belief, it applied for renewal of its registration in the year commencing 1st April, 2009 up to 31.03.2010 to the respondent-Market Committee, but after it realized the illegality of the acts of omission and commission of the respondent-Market Committee, it withdrew its application for renewal by issuing a legal notice dated 21.04.2009, which included the details of inter-State maize purchased and quantity wise details of market fee deposited. According to the petitioner-Company, an amount of ` 22,52,535/- stood illegally recovered and received by the respondent-Market Committee from the petitioner and its manufacturing unit, which the respondent-market committee was liable to refund back to the petitioner alongwith interest. In this background, the petitioner-Company has filed this writ petition praying for the following reliefs:
"(a) Issue directions to the respondent to the effect that the petitioner/company and/or particularly its Manufacturing Unit i.e. Sukhjit Agro Industries at village Gurplah, Tehsil Haroli, District Una, Himachal Pradesh being a manufacturer, was at no point of time earlier and even at present, is not required to register itself under the provisions of The Himachal Pradesh Agricultural & Horticultural Produce Marketing (Development and Regulation) Act, 2005.
(b) Further direct the respondent not to call upon or require the petitioner Company, and/or its manufacturing unit, to register itself under Section 40 of The Himachal Pradesh Agricultural & Horticultural Produce Marketing (Development and Regulation), Act, 2005 and consequently it is not required to pay any market fee to the respondent for and qua its (petitioner's) manufacturing activities carried out through its Manufacturing Unit Sukhjit Agro Industries at Village Gurplah, Tehsil Haroli, District Una, Himachal Pradesh.
(c) Direct the respondent Market Committee not to raise any demand against the Petitioner Company and/or its manufacturing unit, i.e. Sukhjit Agro Industries at Village Gurplah, Tehsil Haroli, District Una, Himachal Pradesh, in any manner whatsoever or to demand or receive any market fees from the petitioner Company and particularly its manufacturing unit known as Sukhjit Agro Industries, Gurplah, Tehsil Haroli, District Una, Himachal Pradesh.
(d) Direct the respondent Market Committee to refund a sum of Rs. 22,52,535/- alongwith interest @ 11.5% per annum from 25th of October, 2007 till the date of payment to the petitioner Company through its manufacturing unit i.e. Sukhjit Agro Industries, Gurplah, Tehsil Haroli, District Una, Himachal Pradesh, realized by it (Respondent Market Committee) on account of market fees.
(e) Call upon the respondent to produce the entire record pertaining to the case and also the subject matter touching upon the same.
(f) Allow any other relief deemed fit by this Court in favour of petitioner and against respondents in the peculiar facts and circumstances attending to the case.
(g) All costs of the petition in favour of the petitioner and against the respondents"
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It its reply, the stand taken by the respondent-Committee is that the petitioner is dealing in agricultural produce and is bringing, selling and purchasing Notified Agricultural Produce within the market area of the respondent-Committee and therefore, the market committee is duty bound to levy, charge and collect market fee on the sale and purchase of its Notified Agricultural Produce as per the provisions of Section 44 of the Act. It is further the case of the respondent-Committee that item "Maize" (Makki) is a specified "Agricultural Produce" within the terms of the Act and petitioner is thus obliged under Section 27 of the Act not to use any place in the area for the purpose of marketing of Notified Agricultural Produce except in accordance with the provisions of the Act and Rules or by laws framed thereunder and the petitioner being "purchaser" and a "trader" and market functionary is thus duty bound to deposit the market fee within 14 days and to submit annual accounts qua the statement of transactions undertaken by or through it during the previous Financial Year. Respondent-Committee has denied that the business of the petitioner unit is that of manufacturing and as per the respondent-Committee, petitioner was processing the maize and obtaining maize starch, maize glutane, maize germs and maize husk out of the said maize. It is further the case of the respondent-Committee that the petitioner-Company was dealing in the business of purchasing, selling, stocking, processing, transporting and value auditioning of agriculture produce, i.e. "Maize", which was a scheduled agricultural produce under item head No. 1 viz. cereals and Sr. No. 4 thereof in the schedule under Section 2(a) and Section 71 of the Himachal Pradesh Agricultural and Horticultural Produce Marketing (Development & Regulation) Act.
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By way of its rejoinder, petitioner-Company reiterated its case put forth in the petition and denied the stand of the respondent-Committee.
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I have heard the learned counsel for the parties and have also gone through the pleadings on record.
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Though a preliminary objection has been taken in its reply by the respondent-Committee about petitioner having alternative remedy, however, this point was not stressed and both the parties addressed the Court on merit.
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The moot issue involved in this writ petition is whether the activity being carried out by the petitioner-Company, subject matter of the writ petition, for which the petitioner-Company as per its version is purchasing maize, which is...
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