R. M. Sahai, J. - (1.) PETITIONER, a licensee u/Sec. 9 of U. P. Krishi Utpadan Mandi Adhiniyam (hereinafter referred as Act) has approached this court against demand of market fee u/Sec. 17 (iii) (b) of the Act. Entire challenge is founded on failure of the Mandi Samiti to render any service to petitioner in present or its capability to render it even in future either individually or collectively. Similar controversy came up for consideration before this court in Civil Misc. Writ Petition No. 13496 of 1983 U. P. Forest Corporation v. State decided on ,28th January 1983. This very bench after examining provisions of the Act in detail and principle laid down in Ram Chandra Kailash Kumar v. State of U. P., AIR 1982 SC 1124 which had relied on Kewal Krishna Puri v. State of Punjab, AIR 1980 SC page 1008 held, "under amended Section 17 (iii) (b) fee can be theoretically charged from a trader in Market area but in order to sustain it the Marketing Committee has to render facility to such trader either individually or collectively in the Market Yard or Sub-Market Yard.". In the counter affidavit filed on behalf of Mandi Samiti the demand of Market fee from petitioner is defended mainly on rendering of statutory service mentioned in Section 16 of the Act as was done in some of the petitions which were decided along with Forest Corporation case. It was not accepted as sufficient. It is not disputed that village Jugrajpur where petitioner carries on the business of purchase and sale of foodgrains, oil seeds legummes etc. is situate at forty kilo meters from the Market area Powayan, it has only three licensees and there is no market or Sub-Market Yard. Allegations in paragraph 6 of the counter affidavit that notification u/Sec. 7 (2) (i) of the Act has been issued and there is proposal to acquire forty hectares of land relates to Powayan. After issuance of notification u/Secs. 6 and 7 of the Act traders carrying on business in Market area may become liable to pay market fee u/Sec. 17 (iii) (b) of the Act. But that alone is not sufficient. It being fee it can be demanded only when the Mandi Samiti is able to establish the basic requirement of rendering service to the trader either individually or collectively. There has to be link between the two however remote it may be. In respect of traders in the market or sub-market yard that link is provided by the Act itself by directing Mandi Samiti to ensure fair dealings and prompt payment in respect of produce sold in the Market or sub-market yard to provide suitable amenities by constructing roads, pathways, market etc, and to prepare plan and work to be undertaken therein, But except for making an effort for fair dealings the Samiti may not be able to raise constructions etc. immediately as it may require land for construction of marketing centre etc. which may entail huge expenditure. To collect the same the Mandi Samiti may demand fee from persons in the Market yard. Such demand shall be justified as it shall be for service to be rendered in furture. It may also not be necessary that every person in the Market yard may be benefited by the service so rendered. As it is being rendered to class of persons carrying on business of purchase and sale of agricultural produce the necessary link between the fee and service shall be deemed to have been established. But can the same be said about a person in the Market Area ? The prohibition in Section 9 (2) is on carrying on business in the Market or sub-market yard and not in the Market area. Unless notification u/Sec. 11 of the Act is issued provision of shifting of business of buying and selling to marketing centre applies to persons in the Merketing Yard. In fact Market or sub-market yard which under Sec. 7 is only part of market area appears to be unit under the Act for carrying on the activity by the Samiti or to put it differently for providing facility and rendering service to persons carrying on business of purchase and sale. But same cannot be said about persons in Market area. By the provision in Act and rules they become different class. Demand of fee can be justified only if Mandi Samiti is able to establish any service rendered to them. The facility in market yard does not furnish the quid pro quo for realising market fee from a person in Market area. If fee is demanded from a trader in Market area then the Mandi Samiti shall be required to establish direct link between payers of fee and service rendered by it And for that there is no material except the general allegations of rendering service as required by Section 16 of the Act.
(2.) BUT the learned counsel for Mandi Samiti urged that the petition was liable to be dismissed as the decision in forest corporation case being founded on Puri's case should be deemed to be expressly or impliedly overruled as the Supreme Court in Srenivas General Trading Company v. State of Andhra Pradesh, AIR 1983 SC 1246 held that the decision in Puri's case did "not lay down any legal principle of general applicability". According to learned counsel, observations in paragraphs 25 to 32 of the decision in Srenivas, case leave no scope for argument that even a trader carrying on business in market area was liable to pay market fee. Learned counsel submitted that Srenivas decision being not only latter, in point of time, but having been given after considering Puri's case leaves no option to this court, but to follow it. No less vehement was the counsel for petitioner in not only distinguishing Srenivas case but also submitting that Puri's case being a Constitution bench decision it may not have been binding on the bench dealing with Srenivas's case but this court was certainly bound by it. Learned counsel urged that Puri's case was in two parts one which after discussing the various features of tax and fee and reviewing certain earlier decisions called out seven principles which was law declared and it could not be ignored by this court. He submitted that it was the other part only which could be described as dealing with dispute between parties therefore obiter dicta. It was also submitted that observation in paragraph 21 of Srenivas case that every decision was to be confined to facts of that case was complete answer to opposite partys argument. Learned counsel urged that even assuming that Puri's case did not lay down any legal principle of general applicability this court was bound by decision in Ram Chandra's case. Whether principle laid down in Puri's case or Srenivas's case is law declared under Article 141 of Constitution of India need not be examined as even applying the ratio of Sreniva's case the petition is liable to succeed. It may not be out of place to mention that in paragraph 41 the Hon'ble court while discussing demand on multipoint observed that provisions of U. P. Act were different from Andhra Pradesh Act. Then in paragraph 32 the Hon'ble court appears to have accepted narrowing down of the requirement of spending, good and substantial amount of fee realised on the prayer of fee laid down in Puri's case to by and large, in, Ram Chandra's case. In paragraph 30 it has been observed : "In determining whether a levy is a fee, the true test must be whether its primary and essential purpose is to render specific services to a specified area or class; it may be of no consequence that the State may ultimately and indirectly be benefited by it. The power of any legislature to levy a fee is conditioned by the fact that it must be 'by and large' a quid pro quo for the services rendered. However, co-relationship between the levy and the services rendered expected is one of general character and not of mathematical exactitude. All that is necessary is that there should be a reasonable relationship between the levy of the fee and the services rendered." Notified market in Andhra Pradesh Act appears to be analogous to market or sub-market yard under U. P. Act. In Srenivas's case it was claimed by petitioners who were in notified market that a trader carrying on business from own premises was not liable to pay fee. It was repelled because the petitioner cannot be heard to say by committing a breach of sub-section (6) of Section 7 that since they effect their transaction in the notified area but outside the market, there is no quid pro quo i. e. services are not rendered outside the market." Market appears to refer to marketing centre. The Hon'ble court was not faced with the problem with which this court was concerned in some of the petitions decided along with Forest Corporation case and in this case. As stated earlier petitioner is in market area which under the Act is larger area than the market yard. Purpose of notification under Section 6 is declaration that activities in the area in respect of agricultural produce shall be subjected to Act. But traders of entire market area cannot be put in one place therefore notification under Section 7 (1) is issued notifying market yard. This, also, normally comprised of a tahsil or number of Gaon Sabhas. Traders of this area may not be able to claim as held in Srenivas's case or in Forest Corporation that as they were carrying on business from their own premises they were not liable to pay fee. But what about a trader of market area ? The Samiti under Act or even otherwise does not render any service either in the area or to class of dealers. Demanding market fee from a person in market area for service rendered in area of market or sub-market yard or to class of dealers therein cannot be accepted as there is reasonable relationship between fee and its payer. Fallacy of the stand by Mandi Samiti is demonstrated by the stand taken by it that a road at huge cost is proposed to be constructed connecting Hani with Jugrajpur which shall, faciliate traders of Jugrajpur in reaching Powayan. Fee under Section 17 is levied on transactions of sale and purchase. If a trader reaches Powayan and sells his goods he shall be paying fee to the purchaser or commission agent who shall realise on behalf of Mandi Samiti. But how can expenditure on construction of road can be charged from a trader who under the rules is not required to shift to Market yard. And what rational or reasonable relationship can be said to exist. It was for this reason that Supreme Court in Puri's case upheld expenditure on link road in Market yard only. Levy or demand of fee cannot be justified unless it is established that person is either carrying on or is capable of carrying on business in market or sub-market yard. ,The Act does not contemplate shifting of all traders of Market area to Market yard. It is neither practical nor feasible. Foodgrain dealer of Powayan may be asked to shift to nearby centre. But a trader of jugrajpur cannot under the Act be required to shift. If the traders in general cannot be directed to shift to marketing centre of Powayan then service rendered in Market yard Powayan cannot be deemed to be service to, traders in Market area of Powayan.
(3.) IN absence of any averment in the counter affidavit that any service is being rendered except the readiness of Samiti to provide Dari, Tripal, Petromax the statutory service mentioned in Section 16 to petitioner is capable of being rendered in future the demand cannot be upheld for acquiring land for Market yard in Powayan or for any facility which may be provided therein. As petitioner is neither in the area nor is covered in class who may be deemed to be benefited by the service rendered by the Mandi Samiti in Market yard of Powayan either in present or in future, no nexus not even the general, is established between the fee and levy. In the result this petition succeeds and is allowed. The Mandi Samiti Powayan is restrained from realising Market fee from petitioner on transactions of sale and purchase carried on in village Jugrajpur. The demand created under Annexure 1 is also quashed. Petitioner shall be entitled to its costs. Petition allowed.;