- (1.) SABHAJEET Yadav, J. By this petition, petitioner has challenged the impugned order dated 9. 10. 2007 passed by respondent No. 3 and conse quential recovery notice dated 10. 10. 2007 issued by respondent No. 2 making a - demand of market fee and development cess from the petitioner under U. P. Krishi Utpadan Mandi Adhiniyam, 1964 (hereinafter referred to as 'the Act' ).
(2.) THE relief sought in the writ petition rests on the assertion that the peti tioner is a Company incorporated under the Companies Act in the name and style of M/s KRBL Limited. It is world's largest Basmati rice exporting unit. Petitioner has its various branches in the State of U. P. , Punjab, Haryana, Delhi and Rajasthan in the name of M/s KRBL Limited. It has its head office at Delhi and its process ing unit and godown is at Alipur which is also situated in Delhi. THE petitioner Company has established milling plant at Ghaziabad in U. P. which was operating since the year 2002-2003. THE petitioner and all its branches are registered under their respective Sales Tax Act and under Central Sales Tax Act wherein they are being duly assessed. All the branches are also registered and being assessed under their respective Krishi Utpadan Mandi Law operating in the respective States. It is stated that since the capacity of milling plant at Ghaziabad is very high and it has to fulfill the huge export requirement, hence the petitioner has to purchase paddy within U. P. and also mills the paddy received from its various branches. THE paddy received from other States is procured after paying Mandi Fee and Development Cess in their respective States by the branches of petitioner Com pany which supplied paddy for the milling. THE rice so recovered from the paddy procured for the purpose of milling from other States is either exported outside India or stock transferred on account of own branch of petitioner to Alipur situated in Delhi. It is also stated that rice sent to Alipur branch, Delhi after milling in Ghaziabad is further processed, sorted and packed. It is stated that no sale takes place within the market area of Ghaziabad and, therefore, there is no liabil ity to pay Mandi Fee under the Act. It is further stated that on 17. 4. 2004 Krishi Utpadan Mandi Samiti, Ghaziabad has illegally imposed Mandi Fee and Development Cess on the rice of petitioner for the year 2002-2003. A photostat copy of the order dated 17. 4. 2004 is on record as Annexure-1 of the writ petition. Being aggrieved against the aforesaid order, the petitioner filed revision under Section 32 of the Act. Vide order dated 14. 9. 2006, the Additional Director (Admn.) has remanded the matter back to the Mandi Samiti only for deciding the issue of stock transfer from Ghaziabad to Alipur at Delhi Unit of the petitioner and refund of the amount of market fee and cess deposited by the petitioner under protest and has given conclusive finding regarding sale price of broken/kinki/rice which was fixed at average rate of Rs. 700 per quintal. A photostat copy of the order dated 14. 9. 2006 passed by Addi tional Director is on record as Annexure-2 of the writ petition. In para 15 to 31 of the writ petition, it is stated that modus operand of petitioner is that the paddy is purchased by the various branches of petitioner in their respective States after paying Mandi Fee is sent for milling at Ghaziabad Unit of the petitioner. A photostat copy of one sample of document depicting the bill, stock transfer challan, bilty, G. R. , unloading slip receipt, gate pass and ar rival receipt issued by Krishi Utpadan Mandi Samiti, Ghaziabad depicting the movement of paddy from the Ex-U. P. Branch to the Ghaziabad unit is enclosed as Annexure-5 of the writ petition. It is stated that this is a sample document and the details of each and every-transaction can be produced if so desired by the Court. After milling the paddy, the rice is sent by way of stock transfer to Alipur branch of the petitioner on the instruction of respective branches situated outside the State of U. P. which have sent paddy for milling. A photostat copy of one such instruction received by Ghaziabad unit from its Haryana branch is enclosed as Annexure-6 of the writ petition. In pursuance of the aforesaid instruction given by the branch of petitioner sending paddy for milling, the Ghaziabad unit of petitioner send the rice after milling to its Alipur branch, where challan, bilty, 9-R, Mandi Gate Pass of Alipur branch are prepared. A photostat copy of one such document depicting the aforesaid transaction is enclosed as Annexure-7 of the writ petition. It is evident from the aforesaid document that the goods are moving from M/s KRBL Limited, Gautam Budh Nagar to KRBL Limited, Alipur, therefore, there is no dispute that goods are moving from one unit to another unit of petitioner and no two different persons are involved in the aforesaid transaction, as is also admitted by the respondents. It is also stated that the processing, sorting and packing of rice takes place in the Alipur branch of the petitioner Company and after goods are unloaded at Alipur branch, the instructions are given by the various branches of the petitioner which had sent paddy for milling, at the head office of the Com pany situated in Delhi. Thereafter the marketing division of the Delhi Head Office instructs the Alipur branch to send the rice to various distributors/buyers/customers which is the ultimate destination. It is also stated that Alipur branch maintains date-wise stock register depicting the movement of rice. It also maintains date-wise details of rice sent to various parties along with the details of customers. The aforesaid document has already been enclosed as Annexure-4 to the writ petition. All the aforesaid documents have been filed before all the respondent authorities and also at the time of hearing. It is stated that in remand proceeding before Mandi Samiti, the petitioner has duly submitted its written submission, a photostat copy of which is on record as Annexure-3 of the writ petition. Subse quently, on 10. 7. 2007 the petitioner has also submitted huge quantum of docu ments before the Chairman, Krishi Utpadan Mandi Samiti running into more than 500 pages and pairokar of the petitioner was personally present along with 15 boxes of documents in original to establish the veracity and truthfulness of each and every transaction of stock transfer made in the assessment year in dispute. A photostat copy of the index showing the documents submitted before the Chair man and documents at Serial No. 1, 2, 6 and 7 are on record as Annexure-4 to this writ petition. But without verifying the details furnished by the petitioner Com pany the respondent No. 2 has erred in treating the stock transfer made by the Ghaziabad unit as its sale within market area of Ghaziabad vide order dated 11. 7. 2007. A photostat copy of the order dated 11. 7. 2007 is on record as Annex-ure-10 of the writ petition. It is stated that from the aforesaid statements it is evident that the movement from Ghaziabad to Alipur branch is not in pursuance of any prior contract of sale. Alipur branch received rice by way of stock replenish ment and is not purchasing it from the petitioner Company. It is further stated that being aggrieved by the order. dated 11. 7. 2007 passed by respondent No. 2 the petitioner has filed a revision under Section 32 of the Act and vide order dated 9. 10. 2007 respondent No. 3 has dismissed the revision while affirming the order dated 11. 7. 2007 passed by respondent No. 2. The copy of order was not served upon the petitioner, however, on 12. 10. 2007 the petitioner was surprised to re ceive the notice dated 10. 10. 2007 directing the petitioner to deposit a sum of Rs. 1,08,18,337/- as Mandi fee and development cess under the Act. Along with the said notice a photostat copy of the order dated 9. 10. 2007 was also annexed. A true copy of recovery notice dated 10. 10. 2007 and order dated 9. 10. 2007 are on record as Annexures-14 and 15 respectively to the writ petition, hence this peti tion.
(3.) ON the basis of assertions made in para 32 to 37 of the writ petition, learned Senior Counsel for the petitioner Sri Bharat Ji Agrawal assisted by Sri Piyush Agrawal and Sri S. M. K. Chaudhary has submitted that according to Sec tion 4 of Sales of Goods Act 1930, a sale is a bilateral contract because the property in goods has to pass from one person to another. Thus, for sale two separate entity are required and a person cannot sell to himself as has been held by Hon'ble the Allahabad High Court in the case of Commissioner Trade Tax v. M/s New Brij Shudh Deshi Ghee Store, 2002 UPTC 1031. While substantiating his argument, learned Counsel for the petitioner has submitted that the petitioner Company has paid Mandi Fee and Development Cess for rice sold within the market area of U. P. but the market fee cannot be imposed upon transaction wherein rice was sent to Alipur branch by way of stock transfer. Even otherwise there was agreement between the petitioner and its branches under clause 10 of which the rice cannot be sold by the milling unit. A photostat copy of the agree ment is on record as Annexure-11 of the writ petition. It has been specifically provided in clauses 10 and 11 of the agreement that Ghaziabad unit shall have no legal right to sell or transfer the rice without prior instruction/permission from various branches and it shall dispatch rice only on instructions of the branches which have sent paddy for milling. It is further submitted that the assessment order passed under U. P. Trade Tax Act as well as under various Sales Tax laws of various States, the statutory authorities constituted under the Act have accepted the very same transaction as stock transfer of the Ghaziabad unit. A photostat copy of assessment order for the assessment year 2002-2003 passed under U. P. Trade Tax Act in case of Ghaziabad unit is on record as Annexure-12 of the writ petition. At the strength of the aforesaid order it is submitted that the Sales Tax Act lays down complete procedure for determining inter/intra-State sales/export sales and stock transfer. In the Mandi Adhiniyam there is no particular procedure for determining as to when sale has taken place within the market area and as to when it is a stock transfer. Therefore, when the Act is silent upon a particular point then the help can be taken from a statute which are specifically on the issue. The Sales Tax assessment orders were passed after making full enquiry and investigation as pre scribed therein. Hence stock transfer under Sales Tax Act is held only after the requisite proof is furnished and the authorities are fully satisfied. On the contrary even if the same transaction is not regarded as stock transfer under the Trade Tax Act due to some procedural lapse it can still be a stock transfer under the Mandi Adhiniyam; hence the assessment order passed under the Sales Tax Act have more persuasive value than the order passed under the Mandi Adhiniyam. Thus, the transaction treated as stock transfer under the Trade Tax Act is binding upon the authorities constituted under the Mandi Adhiniyam, but not vice versa. Mandi Samiti has erred in passing the impugned order in cursory manner without exam ining/discussing the bulky documents submitted/shown by the petitioner which fully establishes the stock transfer made by the petitioner. The petitioner Com pany at Ghaziabad has no role to play with regard to sale made to ultimate customers/distributors situated outside the State of U. P. There is no direct con nection between the exact quantity of rice transferred from Ghaziabad unit and its produces by various buyers at destination.;