# KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. MIS. SHIV SHAKTI KHANSARI UDYOG AND OTHERS

- **Citation:** [2012] 10 S.C.R. 416
- **Court:** Supreme Court of India
- **Decided:** 2012-08-30
- **Case number:** Civil Appeal No. 6186 of 2012
- **Bench:** G.S. Singhvi, H.L. Datiu
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/krishi-upaj-mandi-samiti-narsinghpur-v-mis-shiv-shakti-khansari-udyog-and-others-27954
- **Pages:** 64

## Headnote

Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972 -
ss.19, 31 rlw s.32 and 36 - Transactions involving purchase
C of sugarcane by sugar factories operating in market areas of
the State - Levy of market fee - Validity- Applicability of the
1972 Mandi Adhiniyam - Respondents operating sugar
factories· in different market areas of the State - Notices
issued by appellant-Market Committees requiring the
D respondents to take licence under the 1972 Mandi Adhiniyam
and pay market fee on purchase of sugarcane from Cane
Growers I Cane Growers Cooperative Societies - Quashed by
High Court - Justification of- Held: Justified - The entire field
of sale and purchase of sugarcane is covered by the 1958
E Sugarcane Act and the Sugarcane Control Order, which are
special legislations -
The 1972 Mandi Adhiniyam on the
other hand generally deals with the sale and purchase of
agricultural produce specified in the Schedule appended to
the Adhiniyam - Even though the 1972 Mandi Adhiniyam is
F a subsequent legislation, the general provisions contained in
the said Adhiniyam cannot be invoked for compelling the
occupier of a factory engaged in the manufacture of sugar to
take licence under s.31 rlw s.32 and pay market fee in terms
of s. 19 because the same are in direct conflict with the
G provisions contained in the 1958 Sugarcane Act and the
Sugarcane Control Order - Plea of appellant that the
provisions of the Sugarcane Control Order cannot prevail over
the 1972 Mandi Adhiniyam because the latter was enforced
after receiving Presidential assent cannot be accepted since
H
416
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 417
SHAKTI KHANSARI UDYOG
the State Government had not reseNed the Adhiniyam for A
Presidential assent on the ground of any repugnancy between
the provisions thereof and the Sugarcane Control Order- The
State Government could not have even thought of any
repugnancy between these statutes because at the relevant
time, sugarcane was not treated as an agricultural produce
B
and was not included in the Schedule appended to the 1972
Mandi Adhiniyam - Madhya Pradesh Sugarcane (Regulation
of Supply and Purchase) Act, 1958 - ss. 12, 15, 16, 19,20,21
and 22 - Sugarcane (Control) Order - Clauses 3,4,5,5A and
6 - Essential Commodities Act, 1955 - s. 3.
c
Constitution of India, 1950 - Article 254(2) - Presidential
assent under - Nature and scope of - Discussed.
The respondents were operating sugar factories in
different market areas of the State of Madhya Pradesh
D
and purchasing sugarcane from Cane Growers and Cane
Growers' Cooperative Societies. They filed writ petitions
for quashing the notices issued by the appellant-Market
Committees requiring them to take licence under the
Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972 [for E
short 'the Market Act'] and to pay market fee on the
purchase of sugarcane. It was pleaded on their behalf
that the provisions of the Market Act were not applicable
to the transactions exclusively governed by the Madhya
Pradesh Sugarcane (Regulation of Supply and Purchase)
F
Act, 1958 [for short, 'the Sugarcane Act'] and the
Sugarcane (Control) Order [for short, 'the Control Order']
issued by the Central Government under Section 3 of the
Essential Commodities Act, 1955. The appellants
contested the writ petitions pleading that there is no G
conflict between the Market Act on the one hand and the
Sugarcane Act and the Control Order on the other
because the two sets of legislations operate in different
fields and in view of the section 19 of the Market Act, the
respondents were bound to pay market fee on the
H
418
SUPREME COURT REPORTS
[2012] 10 S.C.R.
A purchase of Sugarcane within the market areas.
The High Court by the impugned order held that
transactions involving the sale and purchase of
sugarcane were governed by Sections 12, 15, 16, 19, 20,
8
21 and 22 of the Sugarcane Act and Clauses 3, 4, 5, SA
and 6 of the Control Order, which are in the nature of
special legislations vis-a-vis the Market Act and, &s such,

## Text

_Characters 0–39,995 of 119,105. This is a partial read: ask again with offset=39995 for what follows._

A
B
[2012] 10 S.C.R. 416
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR
v.
MIS. SHIV SHAKTI KHANSARI UDYOG AND OTHERS
{Civil Appeal No. 6186 of 2012 etc.)
AUGUST 30, 2012
[G.S. SINGHVI AND H.L. DATIU, JJ.]
Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972 -
ss.19, 31 rlw s.32 and 36 - Transactions involving purchase
C of sugarcane by sugar factories operating in market areas of
the State - Levy of market fee - Validity- Applicability of the
1972 Mandi Adhiniyam - Respondents operating sugar
factories· in different market areas of the State - Notices
issued by appellant-Market Committees requiring the
D respondents to take licence under the 1972 Mandi Adhiniyam
and pay market fee on purchase of sugarcane from Cane
Growers I Cane Growers Cooperative Societies - Quashed by
High Court - Justification of- Held: Justified - The entire field
of sale and purchase of sugarcane is covered by the 1958
E Sugarcane Act and the Sugarcane Control Order, which are
special legislations -
The 1972 Mandi Adhiniyam on the
other hand generally deals with the sale and purchase of
agricultural produce specified in the Schedule appended to
the Adhiniyam - Even though the 1972 Mandi Adhiniyam is
F a subsequent legislation, the general provisions contained in
the said Adhiniyam cannot be invoked for compelling the
occupier of a factory engaged in the manufacture of sugar to
take licence under s.31 rlw s.32 and pay market fee in terms
of s. 19 because the same are in direct conflict with the
G provisions contained in the 1958 Sugarcane Act and the
Sugarcane Control Order - Plea of appellant that the
provisions of the Sugarcane Control Order cannot prevail over
the 1972 Mandi Adhiniyam because the latter was enforced
after receiving Presidential assent cannot be accepted since
H
416
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 417
SHAKTI KHANSARI UDYOG
the State Government had not reseNed the Adhiniyam for A
Presidential assent on the ground of any repugnancy between
the provisions thereof and the Sugarcane Control Order- The
State Government could not have even thought of any
repugnancy between these statutes because at the relevant
time, sugarcane was not treated as an agricultural produce
B
and was not included in the Schedule appended to the 1972
Mandi Adhiniyam - Madhya Pradesh Sugarcane (Regulation
of Supply and Purchase) Act, 1958 - ss. 12, 15, 16, 19,20,21
and 22 - Sugarcane (Control) Order - Clauses 3,4,5,5A and
6 - Essential Commodities Act, 1955 - s. 3.
c
Constitution of India, 1950 - Article 254(2) - Presidential
assent under - Nature and scope of - Discussed.
The respondents were operating sugar factories in
different market areas of the State of Madhya Pradesh
D
and purchasing sugarcane from Cane Growers and Cane
Growers' Cooperative Societies. They filed writ petitions
for quashing the notices issued by the appellant-Market
Committees requiring them to take licence under the
Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972 [for E
short 'the Market Act'] and to pay market fee on the
purchase of sugarcane. It was pleaded on their behalf
that the provisions of the Market Act were not applicable
to the transactions exclusively governed by the Madhya
Pradesh Sugarcane (Regulation of Supply and Purchase)
F
Act, 1958 [for short, 'the Sugarcane Act'] and the
Sugarcane (Control) Order [for short, 'the Control Order']
issued by the Central Government under Section 3 of the
Essential Commodities Act, 1955. The appellants
contested the writ petitions pleading that there is no G
conflict between the Market Act on the one hand and the
Sugarcane Act and the Control Order on the other
because the two sets of legislations operate in different
fields and in view of the section 19 of the Market Act, the
respondents were bound to pay market fee on the
H
418
SUPREME COURT REPORTS
[2012] 10 S.C.R.
A purchase of Sugarcane within the market areas.
The High Court by the impugned order held that
transactions involving the sale and purchase of
sugarcane were governed by Sections 12, 15, 16, 19, 20,
8
21 and 22 of the Sugarcane Act and Clauses 3, 4, 5, SA
and 6 of the Control Order, which are in the nature of
special legislations vis-a-vis the Market Act and, &s such,
market fee could not be levied by the Market Committees.
In the instant appeals filed by the State of Madhya
C Pradesh and the Market Committees, the question which
arose for consideration was whether the provisions of the
Market Act were applicable to the transactions involving
the purchase of sugarcane by the factories operating in
the market areas of the State and whether market fee
D could be levied on such transactions.
Dismissing the appeals, the Court
HELD: 1. The High Court did not commit any error
by quashing the notices issued by appellant • Market
E Committees to the respondents requiring them to take
licence under the Market Act and pay market fee on the
purchase of sugarcane from Cane Growers/Cane
Growers Cooperative Societies. [Para 28] [479-C-D]
F
2.1. An analysis of the provisions of the Sugarcane
Act and the Control Order alongwith the Market Act
brings to fore the conflict between the three statutes
insofar as they relate to the transactions involving sale
of sugarcane by Cane Growers I Cane Growers' CoG operative Societies to the occupiers of factories. While
the Sugarcane Act and the Rules framed thereunder
constitute a complete code for regulating the supply of
sugarcane by Cane Growers and Cane Growers' Cooperative Societies to the occupiers of the factories at the
H purchasing centres established and maintained by them
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 419
SHAKTI KHANSARI UDYOG
and payment of price without delay, the Market Act A
regulates sale and purchase of notified agricultural
produce in the market yards specified for the particular
produce or at other places provided in the bye-laws and
mandates that the price of the notified agricultural
produce should be settled by tender bid or open auction
B
system. (Sugarcane was included in the Schedule w.e.f.
7-6-1979 by M.P. Act No.18/1997). The Control Order not
only lays down the mechanism for determination of the
minimum price of sugarcane payable by the producers
of sugar or their agents for the sugarcane purchased by c
them, but also prescribes the mode of payment of the
price. The Sugarcane Act and the Rules framed
thereunder also prescribe the mode of payment of the
price by the occupier of the factory. Likewise, the Market
Act contains provisions for payment of the price of the
0
notified agricultural produce brought into the market yard
for sale. It is thus evident that so far as sugarcane is
concerned, there is direct conflict between the provisions
of the Sugarcane Act and the Market Act both, in matters
relating to sale and purchase of sugarcane, and, payment
of price. Likewise, there is conflict between the Control
E
Order and the Market Act in the matter of determination
of price of the sugarcane and mode of payment. [Para 17]
[456-H; 457-A-F]
2.2. Even though the Market Act is a subsequent
F
legislation and one of its objectives is to regulate buying
and selling of agricultural produce including sugarcane,
the general provisions contained therein cannot prevail
over the Sugarcane Act and the Control Order, which are
special legislations exclusively dealing with issues G
relating to increase in the production of sugarcane, supply
of sugarcane by Cane Growers/Cane Growers
Cooperative Societies to the factories from any reserved
or assigned area or otherwise and payment of the price
of cane by the occupier of the factory. [Para 18] [459-F-H]
H
420
SUPREME COURT REPORTS
[2012] 10 S.C.R.
A
2.3. Though, there is no significant difference in the
Control Order and the Market Act insofar as the mode of
payment of the price of sugarcane is concerned, but the
mechanism enshrined in the two statutes for
determination of price is vastly different. The Control
s Order envisages fixation of the minimum price of
sugarcane by the Central Government after considering
the factors enumerated in Clause 3 and consulting such
authorities, bodies or associations as it may think fit and
the producer of sugar is bound to pay at least that price
c to Cane Growers/Cane Growers Cooperative Societies.
As against this, the Market Act postulates determination
of the price of the notified agricultural produce
(sugarcane is only one of such produce) brought into the
market yard for sale under Section 36(3) by tender bid or
0 open auction. In that exercise, the State Government/the
concerned Market Committee does not have any role to
play. Such price cannot be less than the support price
declared by the State Government. This difference also
indicates that the Control Order is a special legislation
E vis-a-vis the Market Act. [Para 19) [460-A-D]
2.4. The entire field of the sale and purchase of
sugarcane is covered by the Sugarcane Act and the
Control Order, which are special legislations and the
provisions contained in the Market Act, which generally
F deal with sale and purchase of agricultural produce
specified in the Schedule cannot be invoked for
compelling the occupier of a factory engaged in the
manufacture of sugar to take licence under Section 31
read with Section 32 and pay market fee in terms of
G Section 19 thereof because the same are in direct conflict
with the provisions contained in the Sugarcane Act and
the Control Order. [Para 22] [468-8-D]
Be/sund Sugar Co. Ltd. v. State of Bihar (1999) 9 SCC
H 620: 1999 (1) Suppl. SCR 146 and H.S. Jayanna and others
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 421
SHAKTI KHANSARI UDYOG
v. State of Kamataka (2002) 4 SCC 125: 2002 (2) SCR 261
A
- referred to.
Krishi Upaj Mandi Samiti v. Orient Paper and Industries
Ltd. (1995) 1 SCC 655: 1994 (5) Suppl. SCR 392; Basantlal
Banarsilal v. Bansilal Dagdulal AIR 1955 Born. 35; Tika
8
Ramji v. State of U.P. AIR 1956 SC 676: 1956 SCR 393;
Kai/ash Nath v. State of U.P. AIR 1957 SC 790; Basantlal
Banarsilal v. Bansilal Dagdulal AIR 1961 SC 823: 1967 SCR
38; Janardan Pillai v. Union of India (1981) 2 SCC 45: 1981
(2) SCR 676;.'M/s. Hoechst Pharmaceuticals Ltd. and others
v. State of Bihar 1983 (4) SCC 45: 1983 (3) SCR 130; Bharat C
Shivram Sif!gh and others v. State of Gujarat and others
(1986) 4 SCC 51: 1986 (3) SCR 602; P.N. Krishna/al v. Govt.
of Kera/a 1995 (Supp.) 2 SCC 187: 1994 (5) Suppl. SCR
526; Subhash Ramkumar Bind Alias Vakil and another v.
State of Maharashtra (2003) 1 SCC 506: 2002 (4) Suppl.
D
SCR 65; Dharappa v. Bijapur Co-operative Milk Producers
Societies Union Limited (2007) 9 SCC 109: 2007 (5) SCR
729 and Grand Kakatiya Sheraton Hotel and Towers
Employees and Workers Union v. Srinivasa Resorts Limited
and others (2009) 5 sec 342: 2009 (3) SCR 668 - cited.
E
3.1. The argument of the appellants that the
provisions of the Control Order cannot prevail over the
Market Act because the same was enforced after
receiving Presidential assent merits rejection for the
F
following reasons: (i) In the counter filed before the High
Court, no such plea was raised and no document was
produced to show that the Market Act was reserved for
Presidential Assent on the ground that the provisions
contained therein are in conflict with those contained in
G
the Control Order. (ii) It was not argued before the High
Court that the President had been apprised of the conflict
between the Control Order and the Market Act and he
accorded assent after considering this fact. (iii) From the
summary prepared for consideration of the President, it
H
422
SUPREME COURT REPORTS
(2012] 10 S.C.R.
A is clear that the State Government had not reserved the
Market Act for Presidential assent on the ground of any
repugnancy between the provisions of that Act and the
Control Order. As a matter of fact, the State Government
could not have even thought of any repugnancy between
B these statutes because at the relevant time, sugarcane
was not treated as an agricultural produce and was not
included in the Schedule appended to the Market Act.
[Paras 23, 24] [468-E-H; 471-C-D]
3.2. The assent of the President under Article 254(2)
C of the Constitution is not an empty formality and the
President has to be apprised of the reason why his
assent was being sought. If the assent is sought for a
specific purpose, the efficacy of assent would be limited
to that purpose and cannot be extended beyond it.
D Consequently, Article 254(2) of the Constitution is not
available to the appellants for seeking a declaration that
the Market Act would prevail over the Control Order and
that transactions involving the purchase of sugarcane by
the factories operating in the market areas would be
E governed by the provisions contained in the Market Act.
[Paras 25, 28] [471-F-G; 479-B-C]
Gram Panchayat of Village Jama/pur v. Ma/winder Singh
and others 1985 (3) sec 661: 1985 (2) Suppl. SCR 28 and
F Kaiser-I-Hind Private Limited and another v. National Textile
Corporation (Maharashtra North) Ltd. and others (2002) 8
SCC 182: 2002 (2) Suppl. SCR 555 - followed.
Case Law Reference:
G
1994 (5) Suppl. SCR 392 cited
H
AIR 1955 Born. 35
1956 SCR 393
AIR 1957 SC 790
cited
cited
cited
Para 7
Para 7
Para 7
Para 7
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 423
SHAKTI KHANSARI UDYOG
1967 SCR 38
cited
Para 7
1981 (2) SCR 676
cited
Para 7
1983 (3) SCR 130
cited
Para 7
1986 (3) SCR 602
cited
Para 7
1994 (5) Suppl. SCR 526 cited
Para 7
2002 (4) Suppl. SCR 65
cited
Para 7
2007 (5) SCR 729
cited
Para 7
2009 (3) SCR 668
cited
Para 7
1999 (1) Suppl. SCR 146 referred to
Para 20
2002 (2) SCR 261
referred to
Para 21
2002 (2) Suppl. SCR 555 followed
Para 26
1985 (2) Suppl. SCR 28
followed
Para 28
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
6186 of 2012.
From the Judgment & Order dated 6.7.2006 of the High
Court of Madhya Pradesh at Jabalpur in Civil Misc. Writ Petition
No. 3928 of 2006.
WITH
C.A. No. 6187, 6188, 6189, 6190, 6191, 6192, 6193, 6194,
6195, 6196, 6197, 6198, 6199 and 6200 of 2012.
Prashant Kumar, Anurag Sharma, Ashiesh Kumar, B.S.
Banthia for the Appellant.
A.K. Sanghi, Jayant Bhushan, Saket Singh, Niranjana
Singh, Ankur Saijal, Bina Gupta, Pragati Neekhra,
Surynarayana Singh, S.S. Khanduja, B.K. Satija, S.K. Verma,
G. Prakash for the Respondent.
A
B
c
D
E
F
G
H
424
SUPREME COURT REPORTS
[2012) 10 S.C.R.
A
The Judgment of the Court was delivered by
G.S. SINGHVI, J. 1. Leave granted.
2. The questions which arise for consideration in these
appeals filed by the State of Madhya Pradesh and the Market
B Committees against the orders passed by the Division
Benches of the Madhya Pradesh High Court are whether the
provisions of the Madhya Pradesh Krishi Upaj Mandi
Adhiniyam, 1972 (hereinafter described as, 'the Market Act')
are applicable to the transactions involving the purchase of
C sugarcane by the factories operating in the market areas of the
State and whether market fee can be levied on such
transactions.
3. The contesting respondents are operating sugar
0 factories in different market areas of the State and have been
purchasing sugarcane from Cane Growers and Cane Growers'
Co-operative Societies. Thus, they are covered by the general
sweep of the Market Act because sugarcane is a notified
agricultural produce and by virtue of Section 19, the Market
E Committees are empowered to levy market fee on the
transactions involving purchase of sugarcane.
4. The respondents filed writ petitions for quashing the
notices issued by the Market Committees requiring them to
take licence under the Market Act and to pay market fee on
F the purchase of sugarcane, by asserting that the provisions of
the Market Act are not applicable to the transactions which are
exclusively governed by the Madhya Pradesh Sugarcane
(Regulation of Supply and Purchase) Act, 1958 (for short, 'the
Sugarcane Act') and the Sugarcane (Control) Order (for short,
G 'the Control Order') issued by the Central Government under
Section 3 of the Essential Commodities Act, 1955 (for short,
'the EC Act').
5. The appellants contested the writ petitions and pleaded
H that there is no conflict between the Market Act on the one hand
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 425
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.)
and the Sugarcane Act and the Control Order on the other
A
because the two sets of legislations operate in different fields
and in view of Section 19 of the Market Act, the respondents
are bound to pay market fee on the purchase of sugarcane
within the market areas.
6. The Division Bench of the High Court referred to the
~provisions of the Market Act, the Sugarcane Act and the Control
Order and held that the transactions involving the sale and
~urchase of sugarcane are governed by Sections 12, 15, 16,
B
19, 20, 21 and 22 of the Sugarcane Act and Clauses (3), (4),
C
(5), (SA) and (6) of the Control Order, which are in the nature
of special legislations vis-a-vis the Market Act and, as such,
market fee cannot be levied by the Market Committees. The
reasons assigned by the High Court for arriving at this
conclusion are contained in paragraph 17 of order dated
6.7.2006 passed in Writ Petition No. 391/1995 and batch,
D
which is extracted below:
"17. Sub-section (1) of Section 36 quoted above clearly
provides that all notified agricultural produce brought into
the market for sale shall be brought into market yard/yards
E
specified for such produce and shall not, subject to the
provisions of sub-section (2), be sold at any other place
outside such yard. Sub-section (3) of Section 36 further
provides that the price of the notified agricultural produce
brought into the market yard for sale shall be settled by
F
tender bid or open auction system and no deduction shall
be made from the agreed price on any account
whatsoever. Sub-section (4) of Section 36 of the Market
Act further provides that weighment or measurement of all
the notified agricultural produce so purchased shall be
G
done by a licensed weighman in the market yard or any
other place specified by the market committee for the
purpose. Sub section (1) of Se_ction 37 of the Market Act
states that any person who buys notified agricultural
produce in the market area shall execute an agreement
in triplicate in such form as may be prescribed, in favour
H
A
B
c
D
E
F
G
H
426
SUPREME COURT REPORTS
[2012] 10 S.C.R.
of the seller. Sub-section (2) of Section 37 provides for
payment of price of agricultural produce brought in the
market yard on the same day to the seller at the market
yard and additional payment at the rate of one percent, per
day of the total price of the agricultural produce payable
to the seller within five days. These provisions of Sections
36 and 37 of the Market Act are in direct conflict with the
provisions of Clauses (3), (4), (5), (SA) and (6) of the
Control Order made by the Central Government under
Section 3 of the Essential Commodities Act, 1955
discussed above. Similarly these provisions of the Market
Act are in direct conflict with the provisions of Sections 12,
15, 16, 19, 20, 21 and 22 of the Sugarcane Act made by
the State Legislature of Madhya Pradesh, discussed
above. In view of such conflict, either, the aforesaid
provisions of the Market Act apply to the transactions of
buying and selling of sugarcane between the occupiers of
factories and the sugarcane growers or sugarcane
growers cooperative societies, or the provisions of the
Control Order made by the Central Government and the
aforesaid provisions of the Sugarcane Act made by the
State Government apply to such transactions of buying and
selling between the occupiers or owners of sugar factories
and the sugarcane growers or sugarcane growers
cooperative societies. The Control Order made by the
Central Government and the Sugarcane Act made by the
State Legislature being a Special Order and Special Act
relating to supply and purchase of sugarcane will apply to
transactions of sale and purchase of sugarcane between
the occupiers of the factory and the sugarcane growers or
sugarcane growers cooperative societies and the
provisions of the Market Act being a General Act with
regard to agricultural produce will stand excluded and will
not apply to such transactions of buying and selling of
sugarcane between the occupiers of factories and the
sugarcane growers or sugarcane growers cooperative
societies."
KRISHI UPAJ MANDI SAMIT!, NARSINGHPUR v. SHIV 427
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]
7. Shri Vivek Tankha, learned senior counsel appearing for
A
the Market Committees and Shri B.S. Banthia, learned counsel
appearing for the State argued that the object of the Sugarcane
Act and the Control Order is to regulate the supply and purchase
of sugarcane and to ensure that price determined by the
competent authority is paid to the Cane Growers without delay,
B
but these enactments have nothing to do with the levy of market
fee on transactions involving the purchase of sugarcane by the
factories within the market areas and the High Court committed
serious error by declaring that the provisions of the Sugarcane
Act and the Control Order would prevail vis-a-vis those c
contained in the Market Act. The learned counsel further argued
that the ratio of the judgment in Be/sund Sugar Co. Ltd. v. State
of Bihar (1999) 9 sec 620, on which reliance has been placed
by the High Court, has no bearing on the interpretation of the
provisions of the Sugarcane Act and the Market Act because
0
there is significant difference between the Bihar Acts and the
Madhya Pradesh Acts. Shri Tankha emphasized that the Market
Act and the Sugarcane Act operate in different fields and even
if there appears some conflict between the two enactments, the
provisions contained in the Market Act would prevail because
E
the Sugarcane Act does not provide for levy of market fee on
the purchase of sugarcane by the factories. Learned senior
counsel relied upon the judgment in Krishi Upaj Mandi Samiti
v. Orient Paper and Industries Ltd. (1995) 1 SCC 655 and
argued that the sugarcane factories are liable to pay market
fee on the purchase of sugarcane which takes place within the
F
market areas because they are benefitted by the development
works undertaken by the Market Committees and the Madhya
Pradesh Agricultural Marketing Board. Shri Tankha also relied
upon Article 254 of the Constitution and argued that even
though the Control Order has been framed under a Central
G
legislation, the provisions contained therein cannot override the
Market Act which was enforced after receiving Presidential
assent. In support of this argument, Shri Tankha relied upon the
judgments in Basantlal Banarsilal v. Bansi/al Dagdulal AIR
1955 Born. 35, Tika Ramji v. State of U.P. AIR 1956 SC 676
H
428
SUPREME COURT REPORTS
[2012) 10 S.C.R.
A = 1956 SCR 393, Kai/ash Nath v. State of UP. AIR 1957 SC
790, Basantlal Banarsilal v. Bansilal Dagdulal AIR 1961 SC
823, Janardan Pillai v. Union of India (1981) 2 SCC 45, Mis.
Hoechst Pharmaceuticals Ltd. and others v. State of Bihar
1983 (4) SCC 45, Gram Panchayat of Village Jamalpur v.
B Ma/winder Singh and others 1985 (3) SCC 661, Bharat
Shivram Singh and others v. State of Gujarat and others
(1986) 4 SCC 51, Krishi Upaj Mandi Samiti and others v.
Orient Paper and Industries (supra), P.N. Krishna/al v. Govt.
of Kera/a 1995 (Supp.) 2 SCC 187, H.S. Jayanna and others
C v. State of Kamataka (2002) 4 SCC 125, Kaiser-I-Hind Private
Limited and another v. National Textile Corporation
(Maharashtra North) Ltd. and others (2002) 8 SCC 182,
Subhash Ramkumar Bind Alias Vakil and another v. State
of Maharashtra (2003) 1 SCC 506, Dharappa v. Bijapur CoD operative Milk Producers Societies Union Limited (2007) 9
SCC 109 and Grand Kakatiya Sheraton Hotel and Towers
Employees and Workers Union v. Srinivasa Resorts Limited
and others (2009) 5 sec 342.
8. Shri Jayant Bhushan and Shri A.K. Sanghi, Senior
E Advocates and Ms. Pragati Neekhra, learned counsel
appearing for the respondents supported the impugned orders
and argued that being a special legislation, which covers all
aspects of the supply and purchase of sugarcane including the
payment of price to Cane Growers, the Sugarcane Act will
F prevail over the Market Act, which generally empowers the
market committees to levy market fee on the sale and purchase
of notified agricultural produce. More so, because the
procedure prescribed under Section 36 of the Market Act for
the purchase of agricultural produce within the market yard or
G market proper is in direct conflict with the provisions of the
Sugarcane Act which postulate the purchase of sugarcane by
the factories at an identified place or at the factory gate.
Learned senior counsel then argued that the sugar factories
cannot be burdened with the liability of paying market fee on
H the purchase of sugarcane because the same is not taken into
KRISHI UPAJ MANDI SAMIT!, NARSINGHPUR v. SHIV429
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]
consideration while fixing the price of sugar under Clause 3 of A
the Control Order. Shri Bhushan submitted that the Court should
not entertain the argument made by Shri Tankha with reference·
to Article 254 of the Constitution because no such argument
was raised before the High Court and no document has been
produced before this Court to show that Presidential assent
B
was obtained for amendment in the Market Act with specific
reference to the Sugarcane Act.
9. For deciding whether there is any conflict between the
Sugarcane Act and the Control Order on the one hand and the
Market Act on the other, it will be useful to notice the relevant
C
statutory provisions:
The Sugarcane Act
10. The Sugarcane Act was enacted by the State
D
legislature in the backdrop of inadequate supply of sugarcane
to the factories and the difficulties faced by the cultivators in
selling their produce and getting the price. Section 2 of the Act
contains definitions of various terms. Section 3 mandates the
State Government to establish Sugarcane Board for the State.
E
In terms of Section 4, the Sugarcane Board is required to
advise the State Government on matters pertaining to the
regulation of supply and purchase of cane for sugar factories;
F.
the varieties of cane which are suitable for use in sugar
factories; the maintenance of healthy relations between
occupiers, managers of factories, Cane-growers' Co-operative
Societies, Cane Development Council and purchasing agents
and such other matters as may be prescribed. Section 5
provides for establishment of a Cane Development Council,
whose functions are to consider and approve the programme
for development of the zone; to advise regarding the ways and
G
means for the execution of the development plan in all its
essentials such as cane varieties, cane-seed, sowing
programme, fertilizers and manures; to undertake the
development of irrigation and other agricultural facilities in the
zone; etc. Section 8 lays down that there shall be a fund at the
H
430
SUPREME COURT REPORTS
[20121 10 S.C.R.
A disposal of the Council to meet the expenses required to be
incurred for the discharge of duties and performance of its
functions under the Act. The fund shall consist of the grants
made by the Indian Central Sugarcane Committee and the
State Government, sums received by the Council by way of
B commission under Section 21 and any other sum which may
be credited to the fund under the general or special order of
the State Government. Section 12 empowers the Cane
Commissioner to call upon the occupier to furnish an estimate
of the quantity of cane which will be required by the factory
c during the crushing season. The Cane Commissioner is
obliged to examine every such estimate and publish the same
with modification, if any. Section 13 casts a duty on the occupier
to maintain a register of all such Cane Growers and CaneGrowers' Co-operative Societies which are required to sell
0 cane to the factory. Section 14 empowers the State
Government to make provision for survey of an area proposed
to be reserved or assigned for supply of cane to a factory.
Section 15 postulates declaration of reserved area and Section
16 provides for declaration of an assigned area. Under Section
19, the State Government has the power to issue an order for
E regulating the distribution, sale or purchase of cane in any
reserved or assigned area and purchase of cane in any area
other than the reserved or assigned area. Section 20 deals with
the payment of price. Section 21 provides for payment, by the
occupier, of a commission for every one maund of cane
F purchased by the factory. Section 22 gives power to the State
Government to declare varieties of cane which are unsuitable
for use in the factories. Chapter IV contains miscellaneous
provisions including Section 30 under which the State
Government is empowered to make rules for giving effect to
G the provisions of the Act. For the sake of reference, Sections
5, 6, 8, 15, 16, 19, 20 and 21 of the Sugarcane Act are
reproduced below:
"5. The Cane Development Council.- (1) There shall
H
be established, by notification for the reserved area of a
KRISHI UPAJ MANDI SAMIT!, NARSINGHPUR v. SHIV 431
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]
factory a Cane Development Council which shall be a body
A
corporate by the name of such area or such other name
as the State Government may notify in this behalf having
perpetual succession, and subject to such restrictions or
qualifications as may be imposed under this Act or any
other enactment, vested with the capacity of suing and s
being sued in its corporate name, of acquiring, holding,
administering and transferring property both movable and
immovable, and of entering into contracts :
Provided that where the Cane Commissioner so directs,
the Council may be established for a larger or smaller area
C
than the reserved area of a factory.
(2) The area for which a Council is established shall be
called a zone.
(3) to (6)
)()()()(
)()()()( )()()()(
6. Functions of the Council.- (1) Functions of the
Council shall be-
(a)
to consider and approve the programme of
development for the zone;
(b)
to devise ways and means for the execution of the
development plan in all its essentials such as cane
varieties, cane-seed, sowing programme, fertilizers
and manures;
(c)
to undertake the development of irrigation and
other agricultural facilities in the zone;
(d)
to take necessary steps for the prevention and
control of diseases and pests and to render all
possible help in the soil extension work;
(e)
to impart technical training to cultivators in matters
relating to the production of cane;
D
E
F
G
H
A
B
c
D
E
F
G
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432
SUPREME COURT REPORTS
[2012] 10 S.C.R.
(f)
to administer the funds at its disposal for the
execution of the development scheme subject to
such conditions as may be prescribed; and
(g)
to perform other prescribed functions pertaining
and conducive to the general development of the
zone.
(2) The State Government may at any time direct the Cane
Commissioner to convene a joint meeting of two or more
councils. Every such meeting shall be presided over by
such person as may be nominated in that behalf by the
State Government.
8. Council Fund.- (1) There shall be a fund at the
disposal of the Council to meet the charges in connection
with the discharge of its duties and performance of its
functions under this Act.
(2) The fund of the Council shall consist of-
( a)
grants, if any, made by the Indian Central
Sugarcane Committee;
(b)
grants, if any, made by the State
Government;
(c)
sums received by the Council by way of
commission under Section 21; and
(d)
any other sums which may be credited to it
under the general or special orders of the
State Government.
15. Declaration of reserved area. - Without prejudice to
any order under clause (d) of sub-section (2) of Section
19, the Cane Commissioner may, after consulting in the
prescribed manner, the occupier and Cane-growers' Cooperative Society, if any, in any area to be reserved for a
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 433
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]
factory reserve such area for such factory and thereupon
A
occupier thereof shall subject to provisions of Section 22
be liable to purchase all cane grown in such area which is
offered for sale to the factory.
16. Declaration of assigned area.- Without prejudice to
8
any order under clause (d) of sub-section (2) of Section
19, the Cane Commissioner may after consulting in the
manner prescribed, the occupier and Cane-growers' Cooperative Society, if any, in any area to be assigned,
assign such area for the purpose of the supply of cane to
C
a factory in accordance with the provisions of Section 19
during any crushing season; and thereupon the occupier
thereof shall subject to the provisions of Section 22 be
liable to purchase such quantity of cane grown in that area
and offered for sale to the factory as may be determined
0
by the Cane Commissioner.
19. Regulation of purchase anct supply of cane in the
reserved and assigned areas.- (1) The State
Government may, for maintaining supplies, by order
regulateE
(a)
distribution, sale or purchase of cane in any
reserved orassigned area; and
(b)
purchase of cane in any area other than a reserved
or assigned area.
(2) Without prejudice to the generality of the foregoing
powers such order may provide forF
(a)
the quantity of cane to be supplied by each CaneG
groweror Cane-growers' Co-operative Society in
such area to the factory for which the area has been
so reserved or assigned;
(b)
the manner in which cane grown in the reserved
area orthe assigned area shall be purchased by the
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434
SUPREME COURT REPORTS
[2012] 10 S.C.R.
A
factory for which the area has been so reserved or
assigned and the circumstances in which the cane
grown by a cane-grower shall not be purchased
except through a Cane-growers' Co-operative
Society;
B
(c)
the form and terms and conditions of the agreement
to beexecuted by the occupier of the factory for
which an areais reserved or assigned for the
purchase of cane offered for sale:
c
(d)
the circumstances under which permission may be
granted-
(i)
for the purchase of cane grown in reserved or assigned area by a purchasing agent or any person
D
other than the factory for which area has been
reserved or assigned; and
(ii)
for the sale of cane grown in a reserved or
assigned area to any other person or factory other
E
than the factory for which the area is reserved or
assigned;
(e)
such incidental and consequential matters as may
appearto be necessary or desirable for this
purpose.
F
20. Payment of cane price.- (1) The occupier shall make
suitable provision to the satisfaction of the Collector for the
payment of the price of cane.
(2) Upon the delivery of cane, the occupier shall, subject
G
to the deductions specified in sub-section (2-a) be liable
to pay immediately the price of the cane so supplied,
together with all other sums connected therewith and where
the supplies have been made through a purchasing agent,
the purchasing agent shall similarly be liable in addition to
H
the occupier.
KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 435
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]
(2-a) Where a Cane-grower or a Cane-growers' CoA
operative Society, as the case may be, to whom price is
payable under sub-section (1) has borrowed a loan for
cane development from any agency notified by the State
Government in this behalf, the occupier or the purchasing
agent, as the case may be, shall be, on being authorised
B
by that agency so to do, entitled to deduct from the price
so payable, such amount as may be prescribed, towards
the recovery of such loan and pay the same to the agency
concerned forthwith.
c
(3) Where the person liable under sub-section (2) is in
default in making the payment of the price for a period
exceeding fourteen days from the date of delivery he shall
also pay interest at the rate of 14-1/2 per cent, per annum
from the said date of delivery upto the date of payment but
the Cane Commissioner may, in any case, direct with the
D
approval of the State Government that no interest shall be
paid or be paid at such reduced rate as he may fix.
(4) The Cane Commissioner shall forward to the Collector
a certificate under his signature specifying the amount of
E
arrears on account of the price of cane plus interest, if any,
due from the occupier and the Collector, on receipt of such
certificate, shall proceed to recover from such occupier the
amount specified therein as if it were an arrear of land
revenue together with further interest up to the date of
F
recovery."
21. Commission on purchase of cane.- (1) There
shall be paid by the occupier a commission for every one
maund of cane purchased by the factory-
(a)
where the purchase is made through a Canegrowers' Co-operative Society, the commission
shall be payable to the Cane-growers' Co-operative
Society and the Council insuch proportion as the
G
State Government may declare;and
H
436
SUPREME COURT REPORTS
[2012] 10 S.C.R.
A
(b)
where the purchase is made directly from the CaneB
c
D
grower, the commission shall be payable to the
Council.
(2) The commission payable under clauses (a) and (b) of
sub-section (1) shall be at such rates as may be
prescribed provided, however, that the rate fixed under
clause (b) shall not exceed the rate at which the
commission may be payable to the Council under clause
(a).
(3) The provisions relating to payment, interest and
recovery, including recovery as arrears of land revenue,
applicable to price of cane shall mutatis mutandis apply
to payment and recovery of commission under sub-section
(1 )."
11. In exercise of the power vested in it under Section 30
of the Sugarcane Act, the State Government framed the
Madhya Pradesh Sugarcane (Regulation of Supply and
Purchase) Rules, 1959 (for short, 'the Rules'). Rules 2(f), 35,
E 36, 40, 41 and 43, which have bearing on these appeals, read
as under:
F
G
H
"2(f) 'Purchasing Center' means any place at which cane
is purchased, delivered, weighed or paid for and includes
such portion of the premises of the factory as is used for
any of these purposes.
35. At any purchasing centre adequate facilities for
weighment shall be provided to the satisfaction of the
Cane Commissioner by the occupier of a factory to avoid
congestion and undue delay in weighment. Cane carts and
trucks shall not be kept waiting for more than ten hours
without adequate reasons.
Explanation.-A cart shall not be deemed to have been kept
waiting unduly if the supplier of cane, having received
instructions in writing to deliver cane on a certain day,
KRISHI UfiAJ MANDI SAMITI, NARSINGHPUR v. SHIV 437
SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]
ignores such instructions or where the practice of issuing
A
written instructions is in force, brings cane without receiving
such instructions.
36. The occupier of a factory shall -
(a) provide, metalled
approaches from the public roads to the parking ground
B
at the factory premises, from the parking ground to the
cane carrier of factory, and metalled exits from the cane
carrier to public roads, up to such distances as may be
directed by the Cane Commissioner and keep the same
in a proper state of repairs;
(b) provide to the satisfaction of the Cane Commissioner
reasonable space with metalled tracks separated by
railings or walls and properly lighted, for parking of carts
waiting for weighment and keep the same in a proper
state of hygienic cleanliness;
(c) provide shelter and drinking water facilities for both
cartmen and bullocks at the factory gate and drinking water
facilities at all purchasing centres as directed by the Cane
Commissioner; and
(d) provide such other facilities as may be directed by the
Cane Commissioner from time to time.
c
D
E
40. Payments of the price of cane shall be made on the
recorded weight of the cane at the purchasing centre. The
F
price shall be calculated to the nearest Naya Paisa.
41. Payments for cane shall be made only to the Canegrower or his representative duly authorised by him in
writing to receive payment or to a Cane-Growers' CoG
op~rative Society.
43.