1991 PLP 382 (MLD)

Briefly stated the facts are that the respondent No.1 in each case is dealing in the manufacture and bottling of the beverages at Sukkur Site area and purchases the agriculture produce (sugar) for use in such manufacture of beverages and thus according to prosecution he falls within the definition of "dealer" and is required to take out such licence as provided under section 4 of the Agriculture Produce Markets Act, 1939 and also to pay the market fees. The Market Committee, Sukkur after serving notices dated 17-7-1988 and 28-7-1988 in each case submitted the complaint before the Special Magistrate & F.C.M., Municipal Corporation, Sukkur on 10-1-1989 being Case Nos. 1 and 2 respectively through the Inspector and authorized officer Bashir Ahmed. The trial Court framed the charge under section 26 and, Rule 52 of the Agriculture Produce Market Act, 1939 and the Rules of 1940. The charge was read over to the accused/respondent No.l in each case who denied the same. The complainant examined himself and produced the 2 notices and the postal receipts and closed his side. Statement of accused was recorded under section 342, Cr.P.C. and the learned Magistrate after hearing the arguments of the parties' Advocates was pleased to, acquit the present respondent No.l under section 245(1) Cr.P.C. The complainant/appellant has therefore, filed this appeal. Mr. Kalandar Bux Phulpoto, the learned counsel for the appellant has submitted that the trial Magistrate has erred in holding that the present respondent No.l was exempt from taking out the licence and paying the market fee as provided in the above said Act of 1939. He has submitted that the sugar falls within the definition of agricultural produce and is liable to market fee of Re. 0.40 per 50 Kgs. as amended by Notification No. 111/12-32/87 dated 19-9 1988 published in the Sindh Government Gazette of 29-9-1988 and that previous rate was Re.0.25 per 50 Kgs. He has further submitted that the respondent No.l being purchaser of the sugar in large quantity for commercial purposes is liable to take out a licence as required under the Act and also to pay the market fee. He has placed reliance on the case Noon Sugar Mills Ltd. v. Market Committee and others PLD 1989 SC 449 wherein their Lordships have held:-- "

11. The obligation to obtain a licence has been created by section 4(2) of the Punjab Agricultural Produce Markets Act. It reads as follows:-- "After the date of issue of such notification or from such later date as may be specified therein, no person unless exempted by rules framed under this Act, shall either for himself or on behalf of another person, or of the Crown within the notified market area set up, establish or, continue or allow to be continued any place for the purchase and sale of the agricultural produce so notified, or purchase or sell such agricultural produce except under licence granted in accordance with the provisions of this Act, the rules and by-laws made thereunder, and the conditions specified in the licence: Provided that a licence shall not be required by a grower who sells himself or through a bona fide agent his own agricultural produce or the agricultural produce of his tenants on their behalf or by a person who purchases any agricultural produce for his private use." The words which peed examination in the appeals have been underlined. A plain reading of this subsection will indicate that it prohibits purchase or sale of agricultural produce within a notified market area without a licence obtained in accordance with the provisions of the Act, rules and by-laws. On the face of it, the appellants who buy fairly large quantities of sugarcane appear to be falling in the category of persons who are required to obtain licences in accordance with the provision of subsection."

"However that may be, on a plain reading of section 4(2) there is no reason why the requirement of obtaining licence should be confined only to those who both purchase and sell agricultural produce or to exclude from its ambit such persons who merely take part in `one7end' transaction. In fact the proviso which the Legislature has added to the section militates against construing the word "or" in the conjunctive sense. If the said word was intended to mean `and' if to create an obligation to obtain licence against only those who engaged themselves in `two-end' transactions, it was unnecessary to exclude by a specific provision such growers who sold their own or their tenants' produce or such persons who purchased agricultural produce for their private use. It hardly need to be 'added that persons falling in this category are involved only, to use Mr. Zafar's own term, in `one-end' transactions, and on his interpretation of the expression `purchase, or sell', they would have been in any case excluded and it was otiose to make a special provision in their case in order to take them out of the operation of the section." Mr. Phulpoto has also placed reliance on an unreported case of this Court viz. Fazal Flour Mills v. Government of Sindh and another C.P. No. 547 of 1989, wherein a Division Bench of this Court following the above said case of the Honourable Supreme Court, has observed: "(2) Adverting to the first contention of Mr. A. F. M. Mokarim, learned counsel for the petitioners, that the fee can be levied at the first stage and not at the third stage, it may be observed that the charging section is section 19 of the Act which provides that subject to the rules in this behalf a Market Committee can levy a fee on agricultural produce. brought or sold in the notified area. Admittedly the wheat in question is brought within the notified area by the petitioners and, therefore, it is subject to the levy of octroi. In our view, this is immaterial whether the petitioners are the third purchaser or whether they are the first purchaser. According to the petitioners' own showing they purchase wheat from the interior of Sindh and Punjab and bring the same into the notified market. We may point out that the petitioners have been, paying market fee for quite considerable period without any protest. (3) As regards the second contention of the learned counsel for the petitioners that the petitioners purchase wheat from the interior of Sindh and Punjab and not Karachi, it will suffice to observe that the above contention has also been covered by the discussion on-the above first contention." Mr. Shabir Ahmed Awan, the learned counsel for the respondent No.1 has submitted that the fees can be levied at the first stage and that the respondent having purchased the sugar from the local market are at the third stage and therefore they are not liable. This contention of the learned counsel is not sustainable as the market fee is chargeable not only from the seller but also from the buyer in case it is not paid by the seller or from. both in the ratio of half and half. The learned counsel has further submitted that the sugar purchased by the respondent is used in manufacture of the beverages which are exempt from the levy of market fee and therefore the sugar used as such would also be exempt. He has placed reliance on the case of M/s. Electric Lump Manufacturers of Pakistan Ltd. v. Government of Pakistan and 3 others 1989 PTD

42. This case in my view would not be of any help to the respondent as in the said case a Division Bench of this Court (to which I am a member) had held that the glass shells which were used in manufacture of the electric bulbs would still be subject to Sales Tax even when used as such. This decision rather goes against the respondent No.1. From the above discussion the conclusion that can be drawn is that they respondent No.l are under obligation to take out the licence as required under section 4 of the Agriculture Produce Market Act, 1939 and to pay the market fee and lion-compliance of the same, if proved would render them liable for conviction. However, the next point that emerges is as to whether the prosecution in the present case has proved the charge against the respondent No.l. The judgment of the trial Court shows that the learned Magistrate has concluded that because beverages is free from the requirement of licence under section 4 of the said Act therefore, the respondent is automatically free from payment of market fee. In view of above discussion I allow this appeal, set aside the judgment of the trial Court and remand the case to his Court for further proceedings according to law as in this case it has to be determined if at any time the market fee was paid by the Sugar Mill, the whole seller and if any action is taken against them as required under the Rules. N.H.Q./B-179/K Case remanded.