# was delivered by I959 Chimanlal Ptemchanil v. The State of Bombay SuBBA RAO J.-This is an. appeal by special leave

- **Citation:** [1960] 1 S.C.R. 764
- **Court:** Supreme Court of India
- **Decided:** 1960
- **Case number:** CRIMINAL Al.>PELI,ATE JURISDICTION: Criminal Appeal No. 200 of 1957
- **Bench:** Syed Jafer Imam, K. SuBBA RAO
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/was-delivered-by-i959-chimanlal-ptemchanil-v-the-state-of-bombay-subba-rao-j-1825
- **Pages:** 9

## Headnote

Agricultural produce-Packed or pressed-If loses identityState Government-Powers to make rule for regulation of business
and condition of trading-Bombay Agricultural Produce Market Act,
I939 (Bom. 22 of z939), ss. 2 and 26-Bombay Agricultural Produce
Market Rules r94r, r. 65.
The appellant as a trader made purchases of full pressed
cotton bales in the market area of Broach without requisite
licence from the market committee. thereby contravening the
provisions of r. 65(1) of the Bombay Agricnltural Produce Market
Rule 194i. The appellant, inter alia;. contended that the Act and
Rules passed thereunder did not apply to pressed cotton which
having been pressed into bales had lost its identity and was no
more an agricultural produce and that r. 65 was ultra vires inasmuch as its provisions were in excess of the rule making power
of the State Government.
Held, that an agricultural produce by being packed in
containers or pressed into bales does not in any way change its
essential character, and continues to be an agricultural produce,
S.C.R.
SUPREME COURT REPORTS
765
The fact that the cotton ginned or unginned is pressed into bales,
or packed otherwise does not make it any less the cotton and is
an agricultural produce as defined under s. 2 of the Bombay
Agricultural Market Act, 1939.
Under s. 26 of the Act, the State Government has ample
powers to make rules for the regulation of business and conditions
of trading in the market and sub-s. (1) of the said s. 26 confers
power on the State Government to maker. 65.
CRIMINAL
Al.>PELI,ATE
JURISDICTION:
Criminal
Appeal No. 200 of 1957.
Appeal by special leave from the judgment and
order dated the September 11, 1956, of the Bombay
High Court, in Criminal Appeal No. 742 of 1956,
arising out of the judgment and order dated December 31, 1955, of the Joint Civil Judge (J.D.) and
Judicial Magistrate, First Class, Broach, in Criminal
Case No. 605of1953.
Purshottam Tricumdas, J.B. Druku,hanji, S. N. Andley
and Rameshwar Nath, for the appellants.
H.J. Umrigar and R.H. Dhebar, for the respondent.
1959. September 15. The Judgment of the Court
was delivered by
I959
Chimanlal
Ptemchanil
v.
The State of
Bombay
SuBBA RAO J.-This is an. appeal by special leave
Subba Rao J.
against the judgment of the High Court of Judicature
at Bombay setting aside that of the :First Class Magistrate, Broach, and convicting the appellant for contravening the provisions of r. 65 (1) of the Bombay
Agricultural Produce Markets Rules, 1941, hereinafter
called the Rules, and imposing on him a fine of Rs. 25.
The appellant was a trader carrying on business in
cotton at Broach. On February 7 and 9, 1953, he
purchased full pressed cotton bales from M/s. Ratanji
Faramji & Sons in two instalments of 200 bales each
through a licensed broker, Dahyabhai Acharatlal.
Re also purchased 100 bales from Halday Multi-Purpose Co-operative Society. All these purchases were
made by the appellant as a trader in the market area
of Broach without the requisite licence from the
Market Committee. He was charged in the Court of
97
'959
Chimanlal
Premehand
v.
The State of
Bombay
Subba Rao].
766
SUPREME COURT REPORTS [19150(1)]
the Joint Civil Judge (Junior Division) and Judicial
Magistrate, :First Class, Broach, for committing the
breach of r. 65 (1) of the Rules. The Judicial Magistrate held that pressed cotton was not cotton, ginned
or unginned, within the meaning of one of the items
mentioned in the schedule to the Bombay Agricultural Produce Markets Act (hereinafter called "the
Act"), and, therefore, the appellant did, not commit
any offence under the Act or the Rules framed thereunder. The State of Bombay carried the matter by
way of appeal to the High Court of Bombay, and a
Division Bench of the said High Court, consisting of
Chainani and Shah, JJ., allowed the appeal and
convicted the appellant for contravening the provisions of r. 65(1) of the Rules and imposed upon him a
fine of Rs. 25.
This appeal challenges the correctness
of the judgmen

## Text

764
SUPREME COURT REPORTS [1960(1)]
r959
was a graver offence; sometimes involving the security
of the State, and so an amendment was introduced in
J ethanand Bet ab
v.
1949 constituting the possession of such apparatus a
The State of Delhi graver offence and imposing a more severe punishment.
Therefore, it cannot be said that s. 6(1-A),
Subba Rao l· inserted in the Act XVII of 1933 by the amending
Act of 1949, is either covered py the provisions of the
Indian Telegraph Act, 1885, or a surplusage not
serving any definite purpose. Even from the history
of the legislation we find it not possible to say that it
disclosed an intention different from th11t envisaged in
r959
September r5.
s. 6-A of the General Clauses Act.
For the aforesaid reasons, we hold that s. 6 (1-A) of
the Act continued to be on the statute book even after
the amending Act of 1949 was repealed by Act XL VIII
of 1952, and that it was in force when the offence was
committed by the appellant.
The appeal fails and is diSmissed.
CHIMANLAL PREMCHAND
v.
THE STATE OF BOMBAY
(SYED JAFER IMAM and K. SuBBA RAO, JJ.)
Agricultural produce-Packed or pressed-If loses identityState Government-Powers to make rule for regulation of business
and condition of trading-Bombay Agricultural Produce Market Act,
I939 (Bom. 22 of z939), ss. 2 and 26-Bombay Agricultural Produce
Market Rules r94r, r. 65.
The appellant as a trader made purchases of full pressed
cotton bales in the market area of Broach without requisite
licence from the market committee. thereby contravening the
provisions of r. 65(1) of the Bombay Agricnltural Produce Market
Rule 194i. The appellant, inter alia;. contended that the Act and
Rules passed thereunder did not apply to pressed cotton which
having been pressed into bales had lost its identity and was no
more an agricultural produce and that r. 65 was ultra vires inasmuch as its provisions were in excess of the rule making power
of the State Government.
Held, that an agricultural produce by being packed in
containers or pressed into bales does not in any way change its
essential character, and continues to be an agricultural produce,
S.C.R.
SUPREME COURT REPORTS
765
The fact that the cotton ginned or unginned is pressed into bales,
or packed otherwise does not make it any less the cotton and is
an agricultural produce as defined under s. 2 of the Bombay
Agricultural Market Act, 1939.
Under s. 26 of the Act, the State Government has ample
powers to make rules for the regulation of business and conditions
of trading in the market and sub-s. (1) of the said s. 26 confers
power on the State Government to maker. 65.
CRIMINAL
Al.>PELI,ATE
JURISDICTION:
Criminal
Appeal No. 200 of 1957.
Appeal by special leave from the judgment and
order dated the September 11, 1956, of the Bombay
High Court, in Criminal Appeal No. 742 of 1956,
arising out of the judgment and order dated December 31, 1955, of the Joint Civil Judge (J.D.) and
Judicial Magistrate, First Class, Broach, in Criminal
Case No. 605of1953.
Purshottam Tricumdas, J.B. Druku,hanji, S. N. Andley
and Rameshwar Nath, for the appellants.
H.J. Umrigar and R.H. Dhebar, for the respondent.
1959. September 15. The Judgment of the Court
was delivered by
I959
Chimanlal
Ptemchanil
v.
The State of
Bombay
SuBBA RAO J.-This is an. appeal by special leave
Subba Rao J.
against the judgment of the High Court of Judicature
at Bombay setting aside that of the :First Class Magistrate, Broach, and convicting the appellant for contravening the provisions of r. 65 (1) of the Bombay
Agricultural Produce Markets Rules, 1941, hereinafter
called the Rules, and imposing on him a fine of Rs. 25.
The appellant was a trader carrying on business in
cotton at Broach. On February 7 and 9, 1953, he
purchased full pressed cotton bales from M/s. Ratanji
Faramji & Sons in two instalments of 200 bales each
through a licensed broker, Dahyabhai Acharatlal.
Re also purchased 100 bales from Halday Multi-Purpose Co-operative Society. All these purchases were
made by the appellant as a trader in the market area
of Broach without the requisite licence from the
Market Committee. He was charged in the Court of
97
'959
Chimanlal
Premehand
v.
The State of
Bombay
Subba Rao].
766
SUPREME COURT REPORTS [19150(1)]
the Joint Civil Judge (Junior Division) and Judicial
Magistrate, :First Class, Broach, for committing the
breach of r. 65 (1) of the Rules. The Judicial Magistrate held that pressed cotton was not cotton, ginned
or unginned, within the meaning of one of the items
mentioned in the schedule to the Bombay Agricultural Produce Markets Act (hereinafter called "the
Act"), and, therefore, the appellant did, not commit
any offence under the Act or the Rules framed thereunder. The State of Bombay carried the matter by
way of appeal to the High Court of Bombay, and a
Division Bench of the said High Court, consisting of
Chainani and Shah, JJ., allowed the appeal and
convicted the appellant for contravening the provisions of r. 65(1) of the Rules and imposed upon him a
fine of Rs. 25.
This appeal challenges the correctness
of the judgment of the High Court,
Learned Counsel for the appellant raised before us
the following three contentions : (i) the Act and the
Raj.es framed thereunder did not apply to pressed
cotton, and, therefore, the appellant did not contravene the provisions of r. 65 (1) of the Rules; (ii) r. 65
is ultra vires inasmuch as its provisions are in excess
of the rule making power of the State Government;
and (iii) the transactions in question were forward
contracts for future delivery, and, as no delivery was
intended or in fact made, the appellant cannot be said
to have traded in cotton within the market area.
The answer to the first contention turns upon the
interpretation of cl. (1) of sub-s. (1) of s. 2 of the Act
read along with the relevant items or items in the
Schedule. The relevant provisions read:
S. 2 (1): In this Act unless there is anything
repugnant in the subject or context,-
(i) "Agricultural Produce" includes all produce
of agriculture,
horticulture and animal
husbandry specified in the schedule ;
•
•
•
(vi) " Market Area" means any area declared
to be a market area under section 4.
s.o.R.
SUPREME COURT REPOR'.rS
767
Schedule E.
I. Fibres·
·
(i) Cotton (ginned and unginned)
The Bombay Agricultural Produce Markets Rules,
1941:
Rule 65. (1):
No person shall do business as a
trader or a general commission agent in agricultural
produce in any market area except under a licence
granted by the market committee under this rule.
*
*
*
(7) : Whoever does business as a trader or a·
general commission agent in agricultural produce
in any market area without a licence granted under
this rule or otherwise contravenes any of the provisions of this rule shall, on conviction, be punishable
with a fine which may extend to Rs. 200 and in the
case of a continued contravention with a further
fine which may extend to Rs. 50 for every day
during which the contravention continues after the
date of the first conviction, subject to the maximum
of Rs. 200.
The gist of the aforesaid provisions may be stated
thus: Agticultural produce includes all produce of
agriculture specified in the Schedule. Cotton, ginned
and unginned, is specified in the Schedule as an agricultural produce. A trader cannot do business in the
said produce in any market area without obtaining
licence from the Market Committee. If he does such
business without a licence, he is liable to punishment
under r. 65 of the Rules.
If pressed cotton is "cotton, ginned or unginned '',
specified in the Schedule, the appellant, having admittedly done business in the said cotton in the market
area, has contravened the provisions of r. 65, and,
therefore, he is liable to be convicted under r. 67 of
the Rules.
It is contended that ginned cotton which has been
pressed into bales is not cotton within the meaning of
the Act. What is " pressed cotton " in bales ? It
involves a simple process described as pressing, and
cotton is pressed into bales only to facilitate its transport from one place to another; it does not involve
r959
Chimanlal
Premchand
v.
The Stale of
Bombay
Subba Rao].
c~;,.....z.z
1'r...,.llond
v.
The Staie of
BCnllb•Y
Su/Iba Rllo ].
768
SUPREME COURT REPORTS [1960(1 lJ
any chemical change or even a manufacturing process.
Ginned. cotton, after it is pressed into bales, continues
to be ginned cotton, and it is sold and purchased
only as cotton, though in bales. We find it difficult to
accept the argument that pressed cotton is a different
commodity. Nor do we find any relevancy in the
argument that stockists, industrialists and exporters
deal with pressed cotton and not loose cotton, because
the said fact does not in any way change the essential
character of the agricultural produce. If a trader
carries on business in that commodity, tho consideration whether the trader or the buyer is an agriculturist
or a non-agriculturist is not relevant to the enquiry,
Items II to XI of the Schedule specify cereals, pulses,
oilseeds, narcotics, sugarcane, fruits, vegetables, animal
husbandry products, condiments, .spices and others,
and grass and fodder.
A perusal oftheitems indicates
that most of them would be sold in containers like
b1>skets, packages, tins etc. It cannot be argued that
when the pulses, fruits or vegetables are packed in a
basket, the basket with its contents becomes a different
commodity from that contained in it. So too, when
tobacco is pressed and packed, it cannot be suggested
that paqked tobacco has changed its character. So
also in the case <lf other products mentioned in the
Schedule. \Ve do not, therefore, see any principle or
reason for treating cotton in a different way from other
agricultural products.
It is said that the primary object of the Act is to
help agriculturists, that agriculturists do not ordinarily
deal or do business in bales of cotton and tnat. the
fogislature could not, therefore, have intended to make
the Act applicable to pressed cotton. It cannot be
disputed that one of the objects of the Act is to protect
the producers. That object would
certainly
be
defeated, if within the market area a trader, whether
he is an agriculturist or not, can do business of buying
and selling cotton pressed into bales, for by that simple
process he would be free from the restrictions imposed
to protect the agriculturists. The object of such legislation is to protect the producers of agricultural crops
from being exploited by the middlemen and profiteers
S.C.R.
SUPREME COURT REPORTS
769
and to enable them to secure a fair return for their
produce. This object would certainly be defeated if
we were to accept the contention of the learned Counsel
J:Or the appellant.
Shortiy stated tb,e position iA this : Cotton, ginned
or unginnod; continues to be cotton till it loses its
identity by some chem1cal or industrial process. So
long as the identity is not lost, the fa.ct that it is press·
ed into bales or packed otherwise does not make it
any the lefts cotton specified in 'the Schedule to the
Act. In this view, the pressed cotton in bales is an
~gr1(}1l!tura.l produce ae defi.ru¥1 in s. 2(l)(i) of the Act,
and, therefore, the appellant in doing business in the
said produce without licence has contravened r. 65 of
the Rules.
The second contention is that ·r; 65 is in excess of
the rule making power of the State Government. This
argument is elaborated by the· learned Counsel in the
followingma.nner: Purporting to exercise the powers
conferred by s. 26 of the Act, the Government of
'.Bombay ma.de r. 65 prohibiting any person from doing
business as a trader, or as a commission agent, in any
agricultural produce in any market 'area except under
a. licence .granted by the Market Committee under that
rule. Under s. 26(.2)(e) of the Act, t.he State Government has power only to make rules fiXingthe maximum
fees which may be levied by the Market Committee. in
respect of agricultural produce bought and sold by
persons holding a licence under the Act in the market
area. Under the Act the State Government .is only
empowered to grant a licence to any person to use any
place in the market area for the purpose of buying or
selling of any agricultural produce; therefore, under
s. 26(2) (e) of the Act, the Government can only make
a rule prescribing the fees in respect of a licence
issued to a person to use any place in the said area and
not prohibiting any other person from doing business
without a licence in that area. So stated the argument
appears to be plausible, but a scrutiny of the relevant
provisions of the Act, the Rule"1 made by the Government and the Bye-laws framed· by the Market Committee shows that there is no basis for this contention.
The relevant provisions read :
I959
Chimanlal
Premchand
v.
The State of
Bombay
Subba Rao J.
I959
Chimanlal
Prenu;hand
v.
The State of
Bombay
Subba Rao J.
770
SUPREME COURT REPORTS (1960(1)]
The Bombay Agricultural .Produce Markets Act, 1939.
8. 26 (1): The Provincial Government may, either
generally or specially for any market area or market
areas, make rules for the purposes of carrying out
the provisions of this Act.
(2). In particular a.nd without prejudice to the
generality of the foregoing provisions, such rules
may provide for or regulate:-
•
.
.
(e) the management of the market, maximum
fees which may be li;lvied by the market committee
in respect of agricultural produc11 bought and sold by
persons holding a licence under the Act in the
market area.
8. 27 (1): Subject to any rules made by the
Provincial Government under section 26 and with
the previous sanction of the Director or any other
officer specially empowered . .in this behalf by the
Provincial Government, the market· committee may
in respect of the market area under its management
make bye-laws for the regulation of the business and
the conditions of trading therein.
The Bombay Agricultural Produce Markets Rules, 1941.
Rule 65 (1): No person shall do business as a
trader or a general commission ag!'lnt in agricultural
produce in any market area except under a licence
granted by the market committee under this rule.
(2). Any person desiring to hold such licence shall
make a written application for a licence to the
market committee and shall pay such fee as may be
specified in the bye-laws.
(3). On receipt of such application together with
the proper amount of the fee the mll.rket committee
may, after making such enquiries, as may be considered necessary for the efficient conduct of the
market, grant him the licence applied for.
On the
grant of such licence the applicant shall execute an
agreement in such form as the market committee
may determine, agreeing to conform with these rules
and the bye-laws and such other conditions as may
be laid down by the market committee for holding
the licence.
s~o.R.
SUPREME COURT REPORTS
771
(4). Notwithstanding anything contained in subrule (3), the market committee may refuse to grant a
licence to any person, who, in its opinion, is· not
solvent or whose operations in the market area are
not likely to further efficient working of the market
under the control of the market commtitee.
(5). The Hcence shall be granted for a petiod of
one year, after which it may be renewed on a written
application, and after such enquiries as are referred
to in sub-section (3) as may be considered necessary,
and on payment of such fees as may be specified in
the bye-laws.
(6). The names of all such traders and general
commission agents shall be entered in a register to
be maintained for the purpose.
(7). Whoever does business as a trader or a genera.I
commission a.gent in agricultural produce in any
market area without a. licence granted under this
rule or otherwise contravenes any of the provisions·
of this rule shall, on conviction, be puniShable with
fine which may extend to Rs. 200 and in the case of
a. continued contravention with a further fine which
may extend to Rs. 50 for every day during which
the contravention continues after the date of the
first conviction, subject.to the maximum of Rs. 200.
Bye-l,aws of the Agricultural Produce Market Committee, Broach.
Bye.l,aw 33': (I). All traders, genera.I commission
agents, brokers, weighmen, measurers, and surveyors
opera.ting in the market area shall pay full fees for
each market year or any p~rt thereof as per Schedule
given in Appendix No. 2 for obtaining licences, re~
quired to be taken by them, under Rules 65 and 67.
The said provisions ·may be summarized thus: Section 27 of ·the Act empowers the Market Committee,
subject to any rules made by the State Government
under s. 26 · and with the previous sanction of the
Director, to make bye-laws in respect of a market area
for the regulation of th.e business and conditions of
trading therein. Section 26(1) of the Act enables the
State Government to make rules for the purp0ses of
carrying out the provisions of the Act. In exercise of
I959
Chimanlal
Premchand
v.
The State of
Bombay
Subba Rao].
r959
Chimanlal
Premchand
v.
The State of
Bombay
Subba Rao].
772
SUPREME CO"GRT REPORTS [1960(1)]
that power conferred under s. 26(1), the State Government made r. 65 prohibiting any trader from doing
business in agricultural produce except under a licence
granted by the Market Committee. In exercise of
powers conferred under s. 27 on the Market Committee,
it made bye-law 33 prescribing the fee payable in
respect of a licence under r. 65 of the Rules.
The question is whether under s. 26(1) the State
Government is empowered to make r. 65 prescribing
the taking of a licence as a condition for doing business
in a market area. It can do so for the purposes of
carrying out the provisions of the Act. Section 27,
which is a provision of the Act, enables the Market
Committee to make bye-laws for the regulation of the
business and the conditions of trading in the market
area. To enable the Market Committee to discharge
its functions under s. 27 of the Act more effectively,
the Government made a rule prohibiting a trader from
doing business in a market area without licence, and
the Market Committee prescribed the fees payable in
respect of the licence. The rule was certainly one
made for the purpose of facilitating the Market Committee to function effectively under s. 27 of the Act.
That the legislature conferred such a power on the
State Government is also supported by the provisions
of s. 27 of the Act. Under s. 27(1), the bye-laws made
by the Market Committee for the regulation of business
and conditions of trading in the market area are
subject to the rules made by the State Government
under s. 26. This indicates that under s. 26 of the Act,
the State Government has also power to make rules
for the regulation of business and conditions of trading
in the market area, and that power can be spelled out
from the provisions of s. 26(1) of the Act, Therefore,
s. 26(1) confers ample power on the State Government
to make r. 65. In this view, it is not necessary to
invoke the provisions of s. 26(2)(e) to sustain the power
of the State Government to make r. 65.
The third contention though raised was not pursued
in view of the word "business" in r. 65(1) which is
comprehensive enough to take in even forward
contracts.
.
In the result the appeal fails and is dismis11ed,