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PETITIONER: M/S. AMAR NATH OM PARKASH AND ORS. ETC

       Vs.

RESPONDENT: STATE  OF PUNJAB AND ORS. ETC.

DATE OF JUDGMENT29/11/1984

BENCH: REDDY, O. CHINNAPPA (J) BENCH: REDDY, O. CHINNAPPA (J) SEN, A.P. (J) VENKATARAMIAH, E.S. (J)

CITATION:  1985 AIR  218            1985 SCR  (2)  72  1985 SCC  (1) 345        1984 SCALE  (2)769  CITATOR INFO :  F          1985 SC 756  (6)  R          1985 SC 901  (13)  R          1989 SC 317  (34)

ACT:      Punjab Agricultural  Produce  Markets  Act  Excess  See collected from  dealers by  Market Committee u/s 23 declared invalid by Court-Sec. 23A enacted enabling market committees to retain  excess collection  in case  of  dealers  who  had passed on  the burden  of such  fee to the next purchaser of such agricultural produce-Section-Whether within legislative competence-Whether State  Legislature competent  to validate levy declared by Court as bad in law.

HEADNOTE:      After the  decision  of  the  Supreme  Court  in  Kewal Krishan Puri  v. State  of Punjab  AIR 1980  SC 1008 holding that the  increase of  the market  fee from  Rs. 2  to Rs. 3 perhundred leviable  on the  agricultural produce brought or sold by a licensee in the notified market area under section 23 of  the Punjab  Agricultural Produce  Markets Act was not justified, some  dealers wanted  refund of the market fee in excess of  Rs. 2/-per  hundred already  collected by various market committees.  But, the  Supreme  Court  held  in  Shiv Shankar Dal  Mills v. State of Haryana AIR 1980 SC 1037 that dealers who  had not passed on the liabilities to others and others who had contributed to or paid the excess one percent were entitled  to make  claim for  such sums  as were due to them from  the Concerned  market committees and directed the market committees to pay the same The Court further directed that the unclaimed amounts, if any, shall be permitted to be used by  the respective  market committee  for the  purposes falling within  the statute  as interpreted by this Court in C.A. 1083  of 1977.  Thereafter more  or less  in tune  with these directions given by the Court, the Punjab Agricultural Produce Markets  Act was  amended  by  the  introduction  of section 23-A It provided, inter alia, that not with standing anything contained  in any  judgment decree  or order of any court, it  shall be lawful for a committee to retain the fee levied and collected by it from a licensee in excess of that leviable under  section 23  if the burden of such fee passed

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on by the licensee to the next purchaser of the agricultural produce in respect whereof such fee was levied and collected The  appellants   challenged  before   the  High  Court  the constitutional validity  of section  23-A and  the same  was upheld.      The appellant  contended (1)  that Section  23-A was  a blatant attempt  to validate  a levy which had been declared invalid by  the Supreme  Court and  this was not permissible (2) that  while the legislature was competent to enact a law for the  levy of  fee and  matters incidental  and ancillary thereto, it  was incompetent  to legislate providing for the retention by any authority of fee illegally levied. 73      Dismissing the appeals by the appellants ,. ^      HELD: (1)  The general scheme of the Punjab Agriculture Produce Markets  Act and the Act, as amended and in force in Haryana, are broadly on the same lines as the Madras and the Andhra Pradesh  Acts and similar enactments in other States. Sections 13,  26 and  28 of  the Act  covers a vast range of topics and  are so wide as take in a multitude of direct and indirect ways  of achieving the principal object of the Act, namely, the better regulation of the purchase, sale, storage and processing of agricultural produce and the establishment of markets  for agricultural  produce. Some  of the purposes for  which  the  funds  may  be  expended  may  on  a  first impression appear to be municipal or governmental functions, but a  closer scrutiny  will reveal  that they  are  clearly associated with providing better facilities for marketing of agricultural produce. [81H; 86C-D]      (2) The  primary purpose  of s.  23-A is to prevent the refund of  licence fee  by the  market committee to dealers, who have  already passed  on the  burden of  such fee to the next purchaser  of the  agricultural produce and who want to unjustly enrich  themselves by obtaining the refund from the market  committee.   S.  23-A,   in  truth   recognises  the consumer.public who  have borne  the ultimate  burden as the persons who  have really  paid the amount and so entitled to refund of  any excess  fee collected  and there- fore direct the market  committee representing their interests to retain the amount.  It has  to be in this form because it would, in practice, be  a difficult  and futile exercise to attempt to trace the individual purchasers and consumers who ultimately bore the  burden. It is really a law returning to the public what it has taken from the public, by enabling the Committee to utilise  the  amount  for  the  performance  of  services required of  it under the Act. Instead of allowing middlemen to profiteer by illgotton gains,   the    legislature    has devised a  procedure to undo the wrong that has been done by the excessive  levy by allowing the Committees to retain the amount to  be utilised hereafter for the benefit of the very persons for  whose benefit  the  marketing  legislation  was enacted. [97D-G]      (3) There is no substance in the argument that sec. 23- A is  an attempt at validating an illegal levy. Section 23-A does not permit any recovery of fee  at the rate of Rs 3 per hundred in  respect of  any sales  of  agricultural  produce before or  after the  coming into  force of  that provision. There is  no attempt  at retrospective  validation of excess collection  nor   any  attempt   at  providing   for  future collection at  the rate  of Rs.  3  per  hundred.  All  that section 23-A  does is  to prevent unjust enrichment by those dealers who  have already passed on the burden of the fee to the next  purchaser and  so reimbursed  themselves  by  also claiming a  refund from  the market  committees. It gives to

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the public  through the  market committee  what it has taken from the  Public and is due to it. There is no justification for characterising  a provision  like section.  23.A as  one aimed at  validating an  illegal levy. It is consistent with the spirit  of Kewal  Krishan case  and the  Letter of  Shiv Shankar Dal Mills case. [98B D]      Walati Ram  Mahabir Prasad v. State of Punjab, AIR 1983 P &  120 &  R. S.  Joshi v.  Ajit Mills  AIR  1977  SC  2279 approved. 74      Shiv Shankar  Dal Mills v. State of Haryana AIR 1980 SC 1037 followed.      orient Paper  Mills Limited  v. State  of Orissa [1962] SCR 549,  R.S. Joshi  v. Ajit  Mills AIR 1977 SC 2279 relied upon.      Kewal Krishan Puri v. State of Punjab AIR 1980 SC 1008, Srinivasa General  Traders State  of Andhra Pradesh AIR 1983 S. C.  1246 Kutti  Keya v.  State of Madras AIR l954 Mad 621 Arunachala  Nadar,   State  of  Madras,  AIR  1959  SC  30O, Immedisetti Ramkrishnaiah  Sons v.  State of Andhra Pradesh, AIR 1976  AP 193  Sreenivasa General Taaders v. State  A. P. AIR 1983 SC 1246, Shirur Matt [1954] SCR 1005; Hingir-Rampur Coal Co.  Ltd.  v.  State  of  Orissa,  [1962]  2  SCR  537, Corporation of  Calcutta v.  Liberties Cinema  [1965] 2  SCR 477, H. H. Sudhundra Thirtha Swamiar v. Commissioner, [1963] Supp. 2  SCR 302, H. H. Shri Swamiji v. Commisssioner, Hindu Religious and  Charitable Fndowments Department [1980] I SCR 368, Municipal Corporation Delhi v. Mohd. Yasin [1983] 3 SCC 229, Craving  Dock Co.  Ltd. v.  Horton, [1951] A. C. 737 at 761, Home  office v.  Dorset Yacht  Co., [1970]  2 All E. R. 294, Herington  v British  Railways Board  [1972] 2  W. L R. 537, & State OF Bombay v. United Motor. (India) Ltd., [1953] SCR 1069 referred to.      A. V  Nachane and  Ors. v. Union of India, [1982] 1 SCC 2’6 and Abdul Quadar & Co. v. Sales tax officer, AIR 1964 SC 922; held inapplicable.

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil  Appeal Nos.  450O and 4501 of 1984.      Appeals by  Special leave  from the  Judgment and order dated the  18th January  and 18  January, 1984 of the Punjab and Haryana  High Court  in Civil Writ Nos. 33OO of 1981 aud 4757 of 1982.      H.K.  Puri,   M.P.  Jha   and  Sanjeev  Walia  for  the Appellants.      S.K Bagga for the Respondent.      L.N. Sinha, A.K Panda and Ashwani Kumar for the Respon. dent      The Judgment of the Court was delivered by      CINNABAR REDDY  J.  The  appellants,  who  are  traders engaged in  the purchase  and sale  of agricultural produce, appear to  be a  determined lot.  For over a decade, they or those similarly placed have been litigating and impeding the levy and  collection of  Market fee by the Market Committees constituted under  the Punjab  Agricultural Produce  Markets Act. Sometimes  they have  been successful,  sometimes  they have not.  One of  the occasions  when they  appeared to  be successful was  when this  Court in  Kewal Krishan  Puri  v. State 75 Of Punjab(l) declared that the enhancement of the fee from 2% to  3 %  was illegal.  The court  while striking  down the

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enhancement of  the fee laid down no new principles but made certain general  observations which,  we regret to say, have been so  misunderstood and misinterpreted as to lead to some confusion and  public  mischief.  The  misunderstanding  and confusion  have  also  naturally  led  to  more  litigation. Fortunately, in  Srinivsa General Trader. v. Slate of Andhra Pradesh(2)   this    Court   has   removed   much   of   the misunderstanding, cleared  many of the cobwebs and retrieved the situation.      Before we  proceed to consider the question at issue in present case,  it will  be fair  to recall  the  object  and purpose of  the Punjab  Agricultural Produce Markets Act and similar enactments  in force  in other  States Far  back  in 1953, Rajamannar, CJ and T.L. Venkatarama Aiyar, J, in Kutti Keya v.  The State of Madras(3) considered the provisions of the Madras  Commercial Crops  Markets Act  1933, one  of the fore-runner of  the Punjab Agricultural Produce  Markets Act and other  similar enactments  elsewhere. The general nature of the legislation was explained by Venkatarama Aiyar, J, as follows:                "...the Subject-matter of the impugned Act is      marketing and  legislation on  marketing is now a well-      recognised feature of all commercial countries The need      for such a legislation arises whenever societies pass-d      on from  the stage  of self-supporting  economic  unit,      producing only articles for its own consumption to that      of a  commercial community  producing articles for sale      in outside areas for profit. While in the former stage,      transactions  would   be  generally   settled  directly      between the  seller and  the purchaser, the price being      paid and delivery of the commodity taken at the time of      the  deal,  the  conditions  would  be  different  when      commercial crops  are begun  to be raised. The ultimate      purchasers of  these  commodities  would  generally  be      persons outside  the area  of  production,  a  merchant      residing  in  another  State  and  even  in  a  foreign      country.           "To bring about a deal between the local producers      and the outside purchasers, there emerged a class of          (1) AIR 1980 SC 1008.          (2) AIR 1983 S.C, 1246.          (3) AIR 1954 Mad. 621. 76      middlemen.  Even  in  well-organised  and  economically      advanced countries  like England, it was found that the      agrIculturist producer had not facilities for disposing      of the  goods to his best advantage (vide the statement      of Dr.  Addison, Minister  for Agriculture,  quoted  at      page 80 of the Indian Central Banking Enquiry Committee      Report, Vol.  r, Part  II). It is these conditions that      have led  up to  the enactment of marketing laws in all      countries having  a large volume of trade in commercial      crops The  object of this legislation is to protect the      producers of  commercial crops  from being exploited by      middlemen and profiteers and to enable them to secure a      fair need for their produce.             The need for such legislation is even greater in      India as  the producers  are as  a class illiterate and      economically dependent  and unstable. This question had      engaged the  attention of  several committees which had      been constituted to report on various economic matters.      Indian Cotton  was a  commodity greatly  in  demand  in      England  and   other  countries   and  in  the  Central      Provinces  and  Berar  open  markets  for  cotton  were      established through  legislation. In  1919, the  Indian

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    Cotton Committee  observed in  their  report  that  the      marketing  system  afforded  great  protection  to  the      producers  and   that  special  legislation  should  be      undertaken to  establish such  markets in  every cotton      growing area.                The  Royal Commission on Agriculture in India      recorded a  considerable body  of evidence on the state      trade  in  food  crops  and  it  showed  the  need  for      legislative action  for safeguarding  the interests  of      the producers  (vide report  dated 1928).  In 1931  the      Indian Central  Banking Enquiry Committee considered in      Chapter VII of its report the conditions with reference      to marketing.  It  is  therein  pointed  out  that  the      village producer  was seldom able to get a proper price      because he  was chronically  indebted to  the middlemen      who advanced  loans on  the security of the crops to be      grown and  were thus in a position to dictate their own      terms and  that the  bargains were  seldom fair  to the      seller.                "It  was  also  observed  that  for  want  of      facilities for ware-housing the produce, the grower was      not in  a position to wait and sell the commodities for      proper price (vide 77      pages  78   and  79).   In  1933   the  Act  now  under      consideration A was passed with the object of providing      for "the  better regulation  of buying  and selling  of      commercial crops".  It must  be mentioned  that at that      time the  only products  which  had  become  commercial      crops  having  an  international  market  were  cotton,      groundnuts  and   tobacco;  and   the   definition   of      commercial crops  as enacted  originally  corn-  prised      only these three crops."      .......................................................      ...........             "Various suggestions were made for improving the      market conditions (vide pp 92 and 63). In the report of      the Planning Comission published in 1952, Chapter XVII,      Vol l,  deals with  agricultural  marketing  and  after      referring to  the working  of the  regulated markets in      Bombay, Madras, Hyderabad and Madhya Pradesh, it throws      out several  suggestions for  future  improvements.  It      must be  added that there has been legislation on lines      similar to  those of  the Madras  Act in several of the      States in India.           "It will  be clear  from the  above survey  of the      market ing  legislation that  its object  is to  enable      producers to get a fair price for their commodities and      that it  has been  generally adopted  in all commercial      States Such laws have been held in America to be within      the Police  Power of  the State  as tending  to promote      general welfare  (Vide-’Parker v.  Brown [(1942) 87 Law      ED 315  (D).] Under  the Indian Constitution, they must      be upheld  under Art.  19 (6) as reasonable and enacted      in the interests of the general public."      The decision  of the Madras High Court in Kutti Keva v. The   State was  affirmed by  a Constitution  Bench  of  The Supreme Court  in Arunachala  Nadar v.  State of  Madras.(l) Subba Rao,  J. referring  to  the  background  of  the  Act, observed:           "There is  a historical  background for  this Act.      Market ing legislation is now a well-settled feature of      all  commercial   countries.   The   object   of   such      legislation is  to protect  the producers of commercial      crops  from   being  exploited  by  the  middlemen  and

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    profiteers and  to enable  them to secure a fair return      for their produce. In Madras State, as in other          (l) AIR l959 SC 30O. 78      parts  of   the  country,   various   Commissions   and      Committees  have  been  appointed  to  investigate  the      problem, to  suggest ways and means of providing a fair      deal to  the growers  of crops  particularly commercial      crops, and  find a  market for selling their produce at      proper rates.  Several Commit  tees, in  their reports,      considered  this   question  and   suggested   that   a      satisfactory system of agricultural marketing should be      introduced  to   achieve  the  object  of  helping  the      agriculturists  to  secure  a  proper  return  for  the      produce grown by them."           The learned  Judge then  referred to the report of      the Royal  Commission  on  Agriculture  in  India,  the      report  of   the  Expert  Committee  appointed  by  the      Government of Madras, and proceeded to observe:           "With a  view to  provide satisfactory  conditions      for the  growers of  commercial  crops  to  sell  their      produce on  equal terms  and at  reasonable prices, the      Act  was  passed  on  25th  July,  1933.  The  preamble      introduces  the   Act  with  the  recital  that  it  is      expedient to  provide for  the better regulation of the      buying  and   selling  of   commercial  crops   in  the      Presidency of  Madras and for that purpose to establish      market and  make rules for their proper administration.      The  Act,   therefore,  was   the  result   of  a  long      exploratory investigation  by  exports  in  the  field,      conceived  and  enacted  to  regulate  the  buying  and      selling of  commercial crops  by providing suitable and      regulated market  by eliminating middlemen and bringing      face to  face the  produces and  the buyer so that they      may meet  on equal terms, thereby eradicating or at any      rate reducing  the scope  for exploitation in dealings.      Such a  statute cannot  be said  to create unreasonable      restrictions on  the citizens  and right to do business      unless it  is clearly  established that  the provisions      are too drastic, unnecessarily harsh and over-reach the      scope of the object to achieve which it is enacted."      ........................................................      ........................................................           " ..Shortly  stated, the  Act, Rules  and the Bye-      laws framed  thereunder  have  a  long-term  target  of      providing a net work of markets where in facilities for      correct weighment  are   ensured, storage accommodation      is provided, and equal 79      powers of bargaining;, ensured, so that the growers may      t, bring  their commercial crops to the market and sell      them at  reasonable  prices  1  11  such  markets  are.      established, the said provisions, by imposing licensing      restrictions, enable  The buyers and sellers to meet in      licensed  premises,   ensure  correct  weighment,  make      available  to  them  reliable  market  information  and      provide for  them a  simple machinery for settlement of      disputes. After  the markets are built or opened by the      marketing committees,  within a  reasonable radius from      the market,  as prescribed  by the Rules, no licence is      issued; thereafter  all growers  will have to resort to      the market  for vending  their goods. The result of The      implementation of the Act would be to eliminate, as far      as possible,  the  middlemen  and  to  give  reasonable      facilities for  the  growers  of  commercial  crops  to

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    secure best prices for their commodities "           In Immedisetti  Ramkrishnaiah  Sons  v.  State  of      Andhra Pradesh(l), the nature of the duties of a Market      Committee was explained:           "Another  unfounded   assumption  of  the  learned      counsel was that the activities of the Market Committee      and the  facilities provided by it were confined by the      Act  to   the  market  area  only.  The  establishment,      maintenance and improvement of the market is one of the      purposes for  which the  Market Committee Fund might be      expended under  Sec. I S of the Act. The other Services      such as  the pro  vision and  maintenance  of  standard      weights and  measures, the collection and dissemination      of information  regarding all  matters relating to crop      statistics  and   marketing  in   respect  of   noticed      agricultural  produce,   livestock  and  pro  ducts  of      livestock  schemes   for  the   extension  or  cultural      improvement of  notified agricultural produce including      the grant of financial aid to scheme for such extension      on improvement  within such  area undertaken  by  other      bodies or  individuals, propaganda  for the improvement      of agriculture, livestock and products of livestock and      thrift, the promotion of grading services, measures for      the  preservation  of  the  foodgrains,  etc.  are  not      services which are      (1) AIR 1976 AP 193. 80      confined to  the market  area only.  They area services      which are  required  to  be  performed  by  the  Market      Committe and  which  may  be  rendered  throughout  the      notified market  area without  being  confined  to  the      market. Further,  the facilities provided in the market      are  available   for  the   use  of   every  grower  of      agricultural produce and owner of live stock within the      notified market  area. It  is too  much to  expect  the      Market Committee  to provide the same facilities as are      available in  the market  area in every nook and corner      of the notified market area. It is up to the growers of      agricultural produce  and owners  of livestock to avail      themselves of  the facilities  afforded in  the market.      None can  complain against  the levy of licence fees on      the ground  that some  may not  avail themselves of the      facilities available in the market."                 Immedisetti  Ramakrishnayya Sons v. State of Andhra  Pradesh  (supra)  was  approved  by  this  Court  in Sreenivasa General Traders v. State of A.P.,(1) where it was observed:                "It  is obviously  in the  interests  of  the      producers of agricultural produce that they can get the      best competitive prices in an open market and that they      have not  to pay  the middlemen.  Sale or  purchase  of      agricultural produce  in h  such  a  market  under  the      supervision and  control of  the  market  committee  is      likely to  be in ready cash and there fore advantageous      to the  producers and  the use of standard weights must      eliminate the  possibility of  his being  victimized by      malpractices. Supervision  of  the  operations  in  the      notified market  area can  be more conveniently done if      business is  carried on  in a  specified area  or areas      intended for that purpose. The Act is an integrated one      and it  regulates the  buying and  selling of  notified      agricultural  produce,   livestock  and   products   of      livestock    from     a    centralized     place.     "      .......................................................      ..........

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......           "The contention that there is no liability cast on      the petitioners  to pay  market fee  on transactions of      sale and  purchase of  notified  agricultural  produce,      livestock and      (1) ATR.1983 S.C. 1246. 81      product of  livestock proceeds on a wrongful assumption      that they  can still  carry on  such trade  from  their      premises in  the notified  market area, but outside the      market in that area. In view of the express prohibition      contained in  subsection (6) of Sec. 7, the petitioners      cannot carry  on such  trade by  not resorting  to  the      market proper."             "There is a fallacy underlying the argument that      since the  services are  rendered by  market committees      Within the  market proper, there is no liability to pay      a market  fee on  purchase or  sale taking place in the      notified  market  area  but  outside  the  market.  The      contention  does   not  take  note  of  the  fact  that      establishment of a regulated market for the purchase or      sale of  notified agricultural  produce,  livestock  or      products of  live stock is itself a service rendered to      persons engaged  in the business of purchase or sale of      such  commodities.  The  duty  of  a  market  committee      constituted under  sub-section (1) of sec. 4 of the Act      does not  end with  establishing such number of markets      in the  notified market  area under  the first  part of      sub-section (3)  but also  extends to  the providing of      such facilities  in the  market as  the Government  may      from time  to time  by general or special order specify      under the  second part  of sub-section (3). In exercise      of their  powers under  sec. 33  of the  Act, the State      Government have framed the Andhra Pradesh (Agricultural      Produce and  Livestock) Markets  Rules, 1969. Chapter V      relates to  ’Regulation of  trading’. It  would  appear      that Rules  48 to  53 are  the machinery provisions for      controlling the trade in notified agricultural produce,      livestock and  products of livestock in a notified area      while  Rules  54  to  73  impose  restrictions  on  the      carrying on of all such trade in such area. It is clear      from the  provisions of  sec. 15  of the  Act that  the      services to  be rendered  by the  market committee  and      facilities to  be provided  are  not  confined  to  the      market proper but extend throughout the notified area."      The general  scheme of the Punjab Agricultural Produce. Markets Act and the Act, as amended and in force in Haryana, 82      are broadly  on the  same lines  as the  Madras and the      Andhra Pradesh  Acts and  similar enactments  in  other      States. Though we do not consider it necessary to refer      to all  the provisions  of the Punjab and Haryana Acts,      we think it may be appropriate to mention here  those provisions  of the  Act which  enumerate some of  the duties  and powers  of  the  Market  Committees constituted under  the Acts  and the  purposes for which the Marketing Development Fund and the Market Committee Fund may be expended.  We may  mention that  while there  is to  be a State Agricultural  Marketing Board for the entire State for performing the functions and duties assigned to the Board by the  Act,   the  State  Government  may  declare  specified, notified areas as market areas for each of which there shall be a  market committee.  The Board  is vested with powers of superintendence and  control over the committees. Section 13

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prescribes the duties and powers of market committees and is in the following terms:              "13-Duties and powers of Committee-(1) It shall      be the duty of a Committee-            (a) to enforce the provisions of this Act and the      rules and  bye-laws made  thereunder  in  the  notified      market area  and, when  so required  by the  Board , to      establish a  market therein  providing such  facilities      for  persons   visiting  it   in  connection  with  the      purchase, sale,  storage, weighment  and processing  of      agricultural produce  concerned as  the Board  may from      time to time direct;             (b) to control and regulate the admission to the      market, to  determine the conditions for the use of the      market and  to prosecute or confiscate the agricultural      produce belonging  to person  trading without  a  valid      licence;               (c) to  bring, prosecute  or defend  or aid in      bringing, prosecuting  or defending  any suit,  action,      proceeding, application  or arbitration,  on behalf  of      the Committee or otherwise when directed by the Boards.              (2) Every person licensed under sec. 10 or sec.      13 and  every person  exempted under sec. 6 from taking      out licence,  shall on  demand by  the Committee or any      person 83      authorised  by   it  in   this  behalf   furnish   such      information and returns, as may be necessary for proper      enforcement A  of Act  or the  rules and  bye-laws made      thereunder.            (3) Subject to such rules as the State Government      may   make in  this behalf,  it shall  be the duty of a      Committee  to  issue  licences  to  brokers,  weighmen,      measurers,  surveyors,   godown   keepers   and   other      functionaries for  carrying on  their occupation in the      notified market  area  in  respect  of  .  agricultural      produce and to renew, suspend or cancel such licences.               (4) No  broker, weighman,  measurer, surveyor,      godown keeper  or other  functionary shall, unless duly      authorised by  licence, carry  on his  occupation in  a      notified  market   area  in   respect  of  agricultural      produce:           Provided that  nothing in sub-sections (3) and (4)      shall apply  to a  person carrying  on the  business of      warehouse-  man   who  is  licensed  under  the  Punjab      Warehouses Act, l957 (Punjab Act No.2 of 1958)". Section  25   provides  for  the  creation  of  a  Marketing Development Fund  out of  which the  Board has to defray its expenditure. Sections 27 provides for the creation of Market Committee Fund  out of which the Committee has to defray its expenditure. The purpose for which the Marketing Development Fund may be expended are specified in sec. 26 as follows:               "26-The Marketing  Development Fund  shall  be      utilised out of following purposes:-      (i)  Better marketing of agricultural produce;          (ii)  Marketing  of  Agricultural  produce  on  co-      operative lines;          (iii) collection and  dissemination of market rates      and news;          (iv)  grading and  standardisation of  agricultural      produce:          (v)   general improvements  in the markets or their      respective notified;          (vi)  maintenance of  the office  of the  Board and      construction and  repair or its office buildings, rest-

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    house and staff quarters; 84      (vii)     giving aid  to financially weak Committees in      the shape of loans and grants,      (viii)    payment of salary, leave allowance, gratuity,      corn passionate allowance, compensation for injuries or      death resulting  from accidents  while on duty, medical      aid, pension  or provident fund to the persons employed      by the  Board and  leave and  pension  contribution  to      Government servants on deputation;      (ix) travelling and  other allowances  to the employees      of the  Board, its  members  and  members  of  Advisory      Committees;      (x)  propaganda, demonstration  and publicity in favour      of agricultural improvements;      (xi) production and betterment of agricultural produce;      (xii)     meeting any  legal expenses  incurred by  the      Board;      (xiii)    imparting   education    in   marketing    or      agriculture;      (xiv)     construction of godowns;      (xv) loans and advances to the employees;      (xvi)     expenses incurred in auditing the accounts of      the Board;      (xvii)    with  the   previous  section  of  the  State      Government, any  other purpose  which is  calculated to      promote the  general interests  of the  Board  and  the      Committees (or the national or public interests);            Provided that if the Board decides to give aid of      more than  five thousand  rupees to  a financially weak      Committee under clause (vii), the prior approval of the      State Government to such payment shall be obtained. The purposes  for which  the Market  Committees Fund  may be expended are specified in sec. 28 as follows:-      "28-Purposes for  which the  Market Committee Funds may      be expended.  Subject to  the provisions  of section 27      the Market  Committee Funds  shall be  expended for the      following purposes:- (1) AIR 1983 SC 1246 85      (i)  acquisition of sites for the market; A      (ii) maintenance and improvement of the market;      (iii)     construction and  repair of  buildings  which      are necessary  for the  purposes of  the market and for      the health, convenience and safety of the persons using      it;      (iv) provision and  maintenance of the standard weights      and measures:      (v)  pay, leave,  allowances, gratuities, compassionate      allowances and  contributions towards leave allowances,      compensation for  injuries  and  death  resulting  from      accidents  while  on  duty,  medical  aid,  pension  or      provident  fund   of  the   persons  employed   by  the      Committee;      (vi) payment of  interest on  loans that  may be raised      for purposes  of the  market and  the provisions  of  a      sinking fund in respect of such loans;      (vii)     collection and  dissemination of  information      regarding all  matters relating  to crop statistics and      marketing  in   respect  of  the  agricultural  produce      concerned;      (viii)    providing comforts  and facilities,  such  as      the shelter, shade, parking accommodation and water for      the per  sons, draught cattle vehicles and pack animals      link roads  I coming  or being brought to the market or

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    on construction and repair of approach roads, culverts,      bridges and other such purposes:      (ix) expenses  incurred   in  the  maintenance  of  the      offices and in auditing the accounts of the Committees,      (x)  propaganda in  favour of agricultural improvements      and thrift:      (xi) production and betterment of agricultural produce;      (xii)     meeting any  legal expenses  incurred by  the      Committee,      (xiii)    imparting   education    in   marketing    or      agriculture;      (xiv)     payments of  travelling and  other allowances      to the  members and  employees  of  the  committee,  as      prescribed; 86      (xv) loans and advances to the employees;      (xvi)     expenses of and incidental to elections, and      (xvii)    with the  previous sanction of the Board, any      other  purpose  which  is  calculated  to  promote  the      general interest  of  the  Committee  or  the  notified      market area  (supra) (or  with the previous sanction of      the State Government, any purpose calculated to promote      the national or public interest)".      It will  be seen  that sections  26 and 28 cover a vast range of topics and are so wide as to take in a multitude of direct and  indirect ways  of achieving the principal object of the  Act, namely,  the better regulation of the purchase, sale, storage and processing of agricultural produce and the establishment of  markets for  agricultural produce. Some of the purposes  for which  the funds  maybe expended  may on a first  impression  appear  to  be  municipal  or  govemental functions, but  a closer  scrutiny will reveal that they are clearly associated  with  providing  better  facilities  for marketing of agricultural produce. In fact, some of them may be municipal  or governmental  functions,  but  may  yet  be purpose for  which the  funds of  the  marketing  board  and marketing committees  may be  usefully, lawfully and perhaps necessarily expended.  For example,  it  is  of  fundamental importance that  there should  be a  network of  roadways if effective aid  is to  be given  to farmers  to transport and market their  produce. Section  23 of  the Act  enables  the Committee, subject to such rules as may be made by the State Government in  that behalf, to levy on ad volorem basis, fee on the  agricultural produce bought or sold by a licensee in the notified  market area  at a  rate not exceeding the rate mentioned in sec. 23 from time to time for every one hundred rupees. The  fee which  was originally  50 paise per 100 was raised to  Re. l  per 100 in 1969, thereafter to Rs. 1.50 in 1973 and  to Rs.  2.25 in  1974. Later the fee was raised to Rs. 3  per 100.  It was this enhancement of fee to Rs. 3 per 100 that  was challenged  by several dealers from Punjab and Haryana in  Kewal Krishan  v. State  of  Punjab  (Supra).  A Constitution Bench  of this  Court, after  referring to  the principles laid down in the leading cases of Shirur Malt,(1) Hingir-Rampur  Coal   Co.  Ltd.   v.  State   of  Orissa,(2) Corporation of  Calcutta v.  Liberties Cinema  etc.  thought that in all the (1) [1954] SCR 10O5 (2) 119621 2 SCR 537 87 circumstances of  the case,  an increase  of the license fee beyond Rs  2 A  per 100 was not justified. The court noticed that each  of the  market Committees  had huge surpluses and had made  large donations  to educational  institutions  and expended funds  for other  purposes wholly  unconnected with

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the purpose  stipulated by  the Act.  It appeared  that  the increase from  Rs. Z  to Rs.  3 in  the year  1978 was  made largely to  compensate  the  market  committees  for  having contributed the  huge sum  of Rs.  One crore  to the Medical College, Faridkot.  Having regard  to the huge surpluses and unanthorised items  of expenditures,  the court  came to the conclusion, on  the facts  of the case, that the increase of fee above  Rs. 2 per 100 was not justified. In the course of the discussion,  Untwalia, J.  who spoke  for the Court made certain observations  which when  turn out of context appear to give  rise to some misunderstanding. For example, at page 1016 of AIR, he said:             .’But generally and broadly speaking, it must be      shown with  some amount of certainty, reasonableness or      preponderance of  probability that  quite a substantial      portion of  the amount of the fee realised is spent for      the special benefit of its payers".      This sentence  should not be read in isolation. It must be read in the context of the facts of the case. In fact, in the very sentence, preceding the one quoted, it was said:             "It may be so intimately connected or interwoven      with the services rendered to others that it may not be      possible to  do a complete dichotomy and analysis as to      what amount  of special  service was  rendered  to  the      payers of the fee and what proportion went to others".      That was  why Sen  J. in  Sreenivasa General Traders v. State of  Andhra  Pradesh  (Supra)  took  immense  pains  to explain the  observations of  Untwalia J.  and place them in their proper setting. He observed, very rightly indeed, G               "In the  ultimate analysis,  the Court held in      Kewal Krishan  Puri’s case,  supra that  so long as the      concept of fee remains distinct and limited in contrast      to tax,  such expenditure  of the  amounts recovered by      the levy of a market fee cannot be countenanced in law.      A case is an authority H 88      only for  what it actually decides and not for what may      logically follow  from it.  Every judgment must be read      as  applicable  to  the  particular  facts  proved,  or      assumed to  be proved,  since  the  generality  of  the      expressions which may be founded there are not intended      to be  expositions of  the whole  law but  governed  or      qualified by  the particular facts of the case in which      such expressions  are to be found. It would appear that      there are  certain observations  to  be  found  in  the      judgment in  Kewat Krishan  Puri’s case,  supra.  which      were really  not necessary for purposes of the decision      and go  beyond the  occasion and therefore they have no      binding  authority   though  they   may   have   merely      persuasive value.  The observation made therein seeking      to quantify  the  extent  of  correlation  between  the      amount of  fee collected  and the  cost of rendition of      service, namely:              "At least a good and substantial portion of the      amount collected  on account  of fees,  may be  in  the      neighborhood of  two-thirds or  three-fourths  must  be      shown with  reason able  certainty as  being spent  for      rendering services  in the market to the payer of fee".      appears to be an obiter".      obviously Untwalia,  J. did not purport to lay down any new principles  and could  not have  intended to depart from the series  of earlier  case of this Court. For instance, in H. H. Sudhundra Thirtha Swamiar v. Commissioner(l) the Court had said,            ".... nor is it a postulate of a fee that it must

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    have direct relation to the actual services rendered by      the authority  to individual who obtains the benefit of      the service.  If with  a view  to  provide  a  specific      service, levy  is  imposed  by  law  and  expenses  for      maintaining the  service are  met out  of  the  amounts      collected there being a reasonable relation between the      levy  and  the  expenses  incurred  for  rendering  the      service, the  levy would  be in the nature of a fee and      not in  the nature  of a  tax.. but  a levy will not be      regarded as  a tax  merely because  of the  absence  of      uniformity in  its incidence,  or because of compulsion      in the  collection thereof,  or  because  some  of  the      contributories do not obtain the same degree of service      as others may". (1) [1963] Supp 2 SCR 302. 89      In Hingir-Rampur  Coal Co.  Ltd.  v.  State  of  orissa (Supra) the A Court had said,:             "If specific services are rendered to a specific      area or  to a  specific class  of persons  or trade  or      business  in   any  local  area,  and  as  a  condition      precedent for  the said  services or in return for them      cess is  levied against the said area or the said class      of  persons   or  trade   or  business,   the  cess  is      distinguishable from a tax and is described as a fee".            ................................................               "It is true that when the Legislature levies a      fee for rendering specific services to a specified area      or  to  a  specified  class  of  persons  or  trade  or      business, in  the last  analysis    such  services  may      indirectly form  part of  services  to  the  public  in      general. If  the special service rendered is distinctly      and primarily  meant for  the benefit  of  a  specified      class or area the fact that in benefiting the specified      class or  area the  State as a while may ultimately and      indirectly be  benefited would  not  detract  from  the      character of  the levy  as a  fee. Where,  however, the      specific  service   is  indistinguishable  from  public      service, and  in essence  is directly  a  part  of  it,      different considerations  may arise. In such a case, it      is necessary  to enquire  what is the primary object of      the levy and the essential purpose which it is intended      to  achieve.  Its  primary  object  and  the  essential      purpose must  be distinguished  from  its  ultimate  or      incidental results  or consequences.  That is  the true      test in determining the character of the levy,      Again in  H.H.  Shri  Swamiji  v.  Commissioner,  Hindu Religious   and   Charitable   Endowments   Department   (1) Chandracud C.J. said:               "For the purpose of finding whether there is a      correlationship between  the services  rendered to  the      fee  payers  and  the  fees  charged  to  them,  it  is      necessary to  Know the cost incurred for orgainsing and      rendering   the   services.   But   matters   involving      consideration  of  such  a  correlation  ship  are  not      required to  be proved  by a mathematical formula. What      has  to   be  seen   is  whether   there  is   a   fair      correspondence between the fee charged and the cost of (1) [1980] 1 S.C.R. 368. 90 services rendered  to the fee payers as a class. The further and better  particulars asked  for by  the appellants  under order 6,  Rule S  of the  Civil Procedure  Code, would  have driven the  Court, had  the particulars  been supplied, to a laborious and  fruitless inquiry  into minute details of the

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Commissioner’s departmental  budget. A  vivisection  of  the amounts  spent   by  the   Commissioner’s  establishment  at different places  and for  various purposes  and the  ad hoc allocation by  the Court  of different  amounts to different heads would  at best  have been  speculative. It  would have been no  more possible for the High Court if the information were before  us than  it would  be possible  for us  if  the information were  before us,  to find  out what  part of the expenses incurred  by  the  Commissioners  establishment  at various places  and what  part of the salary of his staff at those places should be allocated to the functions discharged by  the   establishment  in  collection  with  the  services rendered to  the appellants.  We do not therefore think that any substantial  prejudice has been caused to the appellants by reasons  of the  non-supply of  the information sought by them."      On a  consideration of  these cases Sen J. concluded as follows in  Sreenivasa General  Traders v.  State of  Andhra Pradesh (Supra):              "The traditional view that there must be actual      quid pro  quo for  a fee  has undergone a sea change in      the subsequent decisions. The distinction between a tax      and a  fee lies  primarily in  the fact  that a  tax is      levied as  part of  a common burden, while a fee is for      payment of a specific benefit or privilege although the      special advantage is secondary to the primary motive of      regulation in public interest      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" 91      a quid  pro quo  for the  services  rendered.  However,      correlationship  between  the  levy  and  the  services      rendered A 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."      Referring to  the catena of these cases it was observed by this  Court in Municipal Corporation Delhi v. Mohd. Yasin (1):               "What do  we learn  from these precedents ? We      learn that there is no generic difference between a tax      and a  fee,  though  broadly  a  tax  is  a  compulsory      exaction as part of a common burden, without promise of      any special  advantages to classes of taxpayers whereas      a fee  is a  payment  for  services  rendered,  benefit      provided or  privilege conferred. Compulsion is not the      hallmark of  the distinction  between a  tax and a fee.      That the  money collected  does not  go into a separate      fund but  goes into the consolidated fund does not also      necessarily make  a levy  a tax. Though a fee must have      relation to  the services  rendered, or  the advantages      conferred, such  relation need  not be  direct, a  mere      causal relation  may be  enough. Further,  neither  the      incidence of  the fee  nor the service rendered need be      uniform. That  others besides those paying the fees are      also benefited  does not  detract from the character of      the fee.  In fact  the special  benefit or advantage to      the payers  of  the  fees  may  even  be  secondary  as      compared with  primary  motive  of  regulation  in  the      public interest. Nor is the court to assume the role of

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    a  cost   accountant.  It   is  neither  necessary  nor      expedient to  weigh too,  meticulously the  cost of his      service reinduced  etc. not  against the amount of fees      collected so  as to  evenly balance  the two.  A  broad      correlationship is  all that is necessary. Quid pro quo      the strict  sense is not the one and only true index of      a fee; nor is it necessarily absent in tax."      Earlier on  a question of interpretation it was pointed      out:      "        A word on interpretation. Vicissitudes of time      and necessitudes  of history  contribute to  changes of      philosophical attitudes,  concepts,  ideas  and  ideals      and, with  them, the  meanings of words and phrases and      the language itself. The philosophy and the language of      the law are no excep-      (1) [1983] 3 S.C.C. 229. H 92      tions. Words and phrases take colour and character from      the context  and the  times and  speak  differently  in      different contexts  and times.  And, it  is  worthwhile      remembering that  words and  phrases have  not  only  a      meaning but  also a  content, a  living  content  which      breathes,  and  so,  expands  and  contracts.  This  is      particularly so  where the  words and  phrases properly      belong to  other disciplines.  ’Tax’ and ’fee’ are such      words. ’they  properly belong  to the  world of  Public      Finance but  since the  Constitution and  the laws  are      also concerned  with Public  Finance, these  words have      often been  adjudicated upon  in an  effort to discover      content."      In  Sreenivasa  General  Traders  v.  State  of  Andhra Pradesh (supra), Sen, J. had also pointed out that there was no generic  difference between  a tax  and a  fee, that both were compulsory exactions of money by public authorities and that a  levy in  the nature  of a fee did not cease to be of that character  merely  because  there  was  an  element  of compulsion or  coerciveness present  in  it  nor  was  it  a postulate of  a fee that it must have direct relation to the actual service rendered by the authority to each individual, who obtains  the  benefit  of  the  service.  He  also  drew attention to  the increasing realization that the element of quid pro quo in the strict sense was not always sine quo non for fee.  Nor was  the element  of quid  pro quo necessarily absent  in  every  tax.  He  further  pointed  out  that  an insistence upon  a good and substantial portion of an amount collected on  account of  fee, say  in the  neighbourhood of two-thirds or  three-forths,  being  shown  with  reasonable certainty as having been spent for rendering services in the market to the payer of fee, could not be a rule of universal application, and that it was a rule which had necessarily to be confined  to the  special facts  of Kewal  Krishan Puri’s case. Otherwise,  it would  affect the validity of marketing legislations undertaken  throughout the  country during  the past half  a century. We agree with the view of Sen, J. that the observations  extracted by him from Kewol Krishan Puri’s case were  not really  necessary for  that case  and we also agree with the clarification of the observation made by Sen, J.      There is  one other  significant sentence in Sreenivasa General Traders v. State of A.P. (Supra) with which we must 93 express our  agreement. It  was said, . with utmost respect, these observations  of the  learned judge are not to be read as Euclid’s  A theorems,  nor as  provisions of the statute. These observations must be read in the context in which they

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appear." We  consider it  proper to  say, as we have already said in  other cases, that judgments of courts are not to be construed as  statutes.  To  interpret  words,  phrases  and provisions of  a statute, it may become necessary for judges to embark  into lengthy  discussions but  the discussion  is meant  to  explain  and  not  to  define.  Judges  interpret statutes, they  do not  interpret judgments.  They interpret words of  statutes; their words are not to be interpreted as statutes. In London Graving Dock Co. Ltd. v. Horton (1) Lord Mac Doormat observed,              "The matter cannot, of course, resettled merely      by treating  the ip  sesame verba  of  Willes,  J.,  as      though they  were part  of an  Act  of  Parliament  and      applying  the   rules  of   interpretation  appropriate      thereto. This  is not  to detract from the great weight      to be  given to the language actually used by that most      distinguished judge." D      In Home  office v.  Dorset Yacht Co.(2) Lord Reid said, "Lord Atkin’s  speech.. is  not to be treated as if it was a statutory definition.  It will  require qualification in new circumstances." Megarry, J. in 1971(1) W.L.R. 1062 observed, "one must  not, of course, construe even a reserved judgment of even  Russell L.  J. as  if it were an Act of Parliament. And, in Herington v. British Railways Board."(2) Lord Morris said:            "There is always peril in treating the words of a      speech or  judgment as  though  they  are  words  in  a      legislative P  enactment, and  it is  to be  remembered      that judicial utterances are made in the setting of the      facts of a particular case.      There are  a few  other observations  in Rewal  Krishan Puri’s case  to which  apply with the same force all that we have said  above. It  is needless  to repeat  the of  quoted truism of Lord Halsbury that (1) [1951] A.C. 737 at 761 (2) [1970] 2 All. E.R. 294 (3) [19721 2 W.L.R. 537 H 94 a case is only an authority for what it actually decides and not for  what may  seem to follow logically from it. We have said so  much about  Kewal Krishan  Puri’s case  because the learned counsel  placed implicit  reliance upon it though as we  shall   presently  show,  we  do  not  see  how  a  mere declaration that the levy and collection of fee in excess of Rs.2 per  hundred automatically vest in the dealer the right to get at the excess amount when in fact he did not bear the burden of  it and  when the  moral and equitable owner of it was the  consumer-public to  whom the burden had been passed on.      Soon after  judgment was  pronounced in Kewal Krishan’s case, the  question arose as to what was to be done with the fee in  excess of  Rs.2 per  100 collected by various market committees. Were  the Market  Committees to  be permitted to retain the  excess amounts  ? Were  the excess amounts to be refunded to  the traders  from whom  the  amounts  had  been collected  notwithstanding   the  fact   that  the   traders themselves had  already passed  on the  burden to  the  next purchasers and  consumers ? In other words, were the traders to be allowed to get a refund from the market committees and unjustly enrich  themselves ?  Were they  to be  allowed  to profiteer by  ill-gotten gains ? or were the next purchasers or consumers  to be traced and the amounts refunded to them, which of  course, would  well-nigh be  an impossible task in practice? If  it was  not possible  to trace  the individual consumers who  had borne  the burden,  was it not right that

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the public  authority who  levied and collected it should be allowed to hold and retain the amount as if it were in trust for their  benefit to be used for the purposes for which the statute .  desired the  levy of  the  fee  ?  Some  dealers, however, wanted  the monies  to be refuned to them and moved this Court. Instead, in the circumstances, the court in Shiv Shankar  Dal  Mil1s  v.  State  of  Haryana.’’(l)  gave  the following directions:               "I. Subject to the directions given below, all      the sums collected by the various market committees who      are respondents  in these  various  writ  petitions  or      appeals shall  be liable to be paid into the High Court      of Punjab  and Haryana within one week of intimation by      the Registrar  of the  amount so liable to be paid into      the court.               "II. A  statement of  the amounts collected in      excess      (1) AIR 1980 SC 1037 95 (1%) shall be put into this Court by the dealers with copies A to  the various  market committees aforesaid and furnished to the  writ petitioners  and appellant  with 1O  days  from today, and if there is any difference between the parties it shall be brought to the notice of this Court in the shape of miscellaneous petitions.  On final  orders,  if  any  passed thereon by  this Court,  those amounts,  so  as  determined, shall be treated as final.      llI. The Registrar of the High Court shall issue public notice and  otherwise give  due publicity  to the  fact that dealers who have not passed on the liabilities to others and others who  have contributed  to  or  paid  the  excess  one percent covered by these writ petitions and appeals may make claims for  such sums as are due to them from him Within one month or  such other  period as  he may  fix. The  Registrar shall scrutinise  such claims  and  ascertain  the  sums  so proved. He  will thereupon  demand of all the market commit- tees concerned  payment into  the Registry  of such  sums in regard to  which proof  of claims  have been  made. On  such intimation,  the   market  committees  shall  pay  into  the Registry the amounts so demanded by the Registrar within one week of  such intimation.  The amount shall be paid together with interest  at 10 per cent per annum from today up to the date of deposit with the Registrar.      IV. It  shall be  open to  the Registrar  to make  such periodical claims  on appropriate  proof by claimants on the line stated above.      V. He  will devise  the  mechanics  of  processing  the claims as  best as  he may and, in the event of dispute, may refer to  the High  Court for its decision of such disputes, if he  thinks it necessary. Otherwise, he may dispose of the objections finally. G      VI. If  any further  directions regarding the mechanics of the claim of refund or otherwise are found necessary from this Court,  the High Court will report about such matter to this Court and orders made thereon will bind the parties. N 96            VII. If parties eligible for repayment of amounts      do not  claim within  one year from today the Registrar      will not  entertain any further claims. It will be open      to such  parties to  pursue their remedies for recovery      for any sums that may be due to therm.               VIII. Each  State Marketing Board will deposit      within 1O  days from  today a sum of Rs. 5.000/- before      the Registrar for the preliminary expenses of publicity      and other  incidentals for  the implementation  of  the

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    directions given  above. Any  unexpended amount, at the      end of one year, will be repaid to the respective State      Marketing Board.             IX. We further direct that the unclaimed amount,      if any, shall be permitted to be used by the respective      Marketing Committees for the purpose falling within the      statute as  interpreted by  this Court in the C. A. No.      1083/77".              Thereafter,  more or  less  in  tune  with  the directions given by the Court in ShivShankar Dal Mills case, the Punjab  Agricultural Produce  MarKets Act was amended by the introduction of sec. 23-A providing as follows:               "In the  Principle Act,  after Section 23, the      following section p shall be inserted namely:- ’23-A(1) Notwithstanding  anything contained in any judgment decree or  order of  any Court,  it shall  be lawful  for  a Committee to  retain the fee levied and collected by it from a licensee in excess of that levied under Section 23, if the burden of such fee was passed on by the licensee to the next purchaser of  the Agricultural  Produce in  respect  whereof such fee was levied and collected.      (2) No  suit or  other proceedings shall be instituted,      main trained  or continued  in any court for the refund      of whole or any part of the fee retained by a Committee      under sub-section  (1) and  no court  shall enforce any      decree or  order directing  the refund  of whole or any      Part of such fee.      (3) If  any dispute  arises as to the refund of any fee      retained by  a Committee  by virtue  of sub-section (1)      and 97      the question  is whether  the burden  of SUCH  fee  was      passed on  by the licensee to the next purchaser of the      concerned agricultural  produce, it  shall be  presumed      unless proved  otherwise that such burden was so passed      on by the licensee.      (4). If  any amount  of tee  retainable by  a Committee      under  sub-section   (1)  has   been  refunded  to  any      licensee,  the   same  shall   be  recoverable  by  the      Committee in the manner indicated in sub-section (2) of      Section 41.      (5). The  provisions of  this section  shall not effect      the operation  of Section  6 of the Punjab Agricultural      Produce Markets (Amendment and Validation) Act, 1976".      The primary purpose of sec. 23-A is seen on the face of it; it  prevents the  refund of  license fee  by the  market committee to  dealers, who have already passed on the burden of such  fee to  the  next  purchaser  of  the  agricultural produce and  who  went  to  unjustly  enrich  themselves  by obtaining the  refund from the market committee. S. 23-A, in truth, recognises  the Consumer  public who  have borne  the ultimate burden  as the  persons who  have really  paid  the amount and so entitled to refund of any excess fee collected and therefore  directs  the  market  committee  representing their interests  to retain  the amount. It has to be in this form because  it would,  in practice,  be  a  difficult  and futile  exercise   to  attempt   to  trace   the  individual purchasers and  consumers who ultimately bore the burden. It is really  a law  returning to  the public what it has taken from the  public, by  enabling the  Committee to utilise the amount for  the performance of services required of it under the Act.  Instead of  allowing  middlemen  to  profiteer  by illgotten gains,  the legislature has devised a procedure to undo the wrong item that has been done by the excessive levy by allowing  the Committees  to  retain  the  amount  to  be

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utilised here  after for the benefit of the very persons for whose benefit  the Marketing  legislation was  enacted.  The constitutional validity  of sec.  23A was  questioned before the High  Court of  Punjab and  Haryana, but  was upheld  in Walati  Ram  Mahabir  Prasad  v.  State  of  Punjab(l).  The correctness of  this decision  is questioned  before  us  in these two civil appeals.      The submission of the learned counsel was that sec. 23- A was      (1). AIR 1984 P&H 120 98 a blatant attempt to validate a levy which had been declared invalid by  this court  and this,  according to  the learned counsel, was  not permissible. We entirely disagree with the submission that  sec. 23-A  is an  attempt at  validating on illegal levy.  Section 23-A  does not permit any recovery of fee @Rs.  3 per  100 in respect of any sales of agricultural produce before  or after  the  coming  into  force  of  that provision. There  is no  attempt at retrospective validation of excess collection nor any attempt at providing for future collection at  the rate of Rs. 3 per 100. All that sec. 23-A does is  to prevent  unjust enrichment  by those dealers who have already  passed on  the burden  of the  fee to the next purchaser and  so reimbursed  themselves by  also claiming a refund from the Market Committees. We have already explained the true  purpose of  S 23-A. It gives to the public through the market  committee what  it has taken from the public and is due to it. It renders into Caesar what is Caesar’s. We do not see  any justification  for characterising  a  provision like Sec.  23-A as  one aimed at validating an illegal levy. The decision  of this  Court in  A. V.  Nachane and  ors. v. Union of  lndia(1) on  which the counsel placed reliance has no application  whatsoever. Section  23-A in  our  view,  is consistent with  the spirit  of Kewal Krishan and the letter of Shiva Shankar Dal Mills.           Another submission of the learned counsel was that while the  legislature was  competent to enact a law for the levy of  a fee  and matters incidental and ancillary thereto it was  incompetent to legislate providing for the retention by any  authority of fee illegally levied. For this purpose, reliance was  placed by  the learned counsel on the decision of this Court in Abdul Quadar & Co. v. Sales tax officer(a). We are  afraid that this decision also is of no avail to the appellants.              In  orient Paper  Mills  Limited  v.  State  of Orissa(3), a  dealer had  been assessed  to tax and had paid the tax.  Later he applied for re fund of tax which was held to be  not exigible  by this  Court in  State of  Bombay  v. United Motors (India) Ltd(’) . When the appeals were pending in this  Court, the  orissa Legislature  intervened  in  the matter  and  introduced  sec.  14-A  in  the  Principal  Act providing that (1) [1982] I SCC 206. (2) AIR 1964 SC 922. (3) [19621 1 SCR 549 (4) [19531 SCR 1069. 99 refund could  be claimed  only by  a person  from  whom  the dealer has  A actually realised the amount as tax. The vires of the  provision was  challenged in  this Court, but it was upheld on  the ground  that it  came within  the  incidental power arising  out of  Entry 54  of List  II. The matter was considered to  be a  question of refund and it was held that it could not be doubted that refund of the tax collected was always a  matter covered  by incidental and ancillary powers

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relating to the levy and collection of tax. The Constitution Bench held,               "By item  54 of  List Il  of Schedule 7 to the      Constitution, the  State Legislature  was  indisputably      competent to legislate with respect to taxes on sale or      purchase  of   papersand  paper-boards.  The  power  to      legislate with  respect to  a tax comprehends the power      to  impose   the  tax,   to  prescribe   machinery  for      collecting the tax, to designate the offers by whom the      liability  may   be  enforced   and  to  prescribe  the      authority, obligations and indemnity of those officers.      The diverse heads of legislation in the Schedule to the      Constitution demarcate  the  periphery  of  legislative      competence and  include all matters which are ancillary      or subsidiary  to the  primary head. The Legislature of      the orissa  State was  therefore competent  to exercise      power in  respect of the subsidiary or ancillary matter      of granting  refund  of  tax  improperly  or  illegally      collected, and  the competence  of the  legislature  in      this  behalf  is  not  canvassed  by  counsel  for  the      assesses.  If  competence  to  legislate  for  granting      refund of sales-tax improperly collected be granted, is      there any  reason to  exclude the power to declare that      refund shall  be claimable only by the person from whom      the dealer  has actually realised the amounts by way of      sales-tax or  otherwise ?  We see none. The question is      one  of   legislative  competence   and  there   is  no      restriction either  express or implied imposed upon the      power of the Legislature in that behalf."      The present  case is  a case akin to orient Paper Mills case (supra).  Section 23-A,  as we  have seen,  disables  a dealer from  getting a refund of fee paid by him, the burden of which  he has already passed on to the next purchaser. As we said  all that  sec.  23-A  does  is  to  prevent  unjust enrichment by means 100 of a  refund to which the person claiming it has no moral or equitable entitlement.      Abdul Quader  & Co.  v. Sales  Tax officer  (supra)  on which  considerable  reliance  was  placed  by  the  learned counsel for  the appellants  was an entirely different case. The dealer  in that  case had  collected sales  tax from the purchasers in  connection with  the sales made by him on the basis that  the incidence  of the tax lay on the sellers and assured the  purchaser that  after paying  the  tax  to  the appellant, there  would be  no further  liability  on  them. After realizing  the tax, however, the appellant did not pay the amount  realized to  the Government,  but kept  it in  a suspense account.  When the  Sales Tax Department discovered this and  called  upon  the  appellant  to  pay  the  amount realized, he  refused to do so. On behalf of the Government, reliance was  placed upon  sec.  11  (2)  of  the  Hyderabad General Sales  Tax Act  which  laid  down  that  any  amount collected by  way of  tax otherwise  than in accordance with the provisions  of  the  Act  shall  be  paid  over  to  the Government and  in default  of such payment, the said amount shall be recovered from such person as if it were arrears of land revenue.  The Court  held that  it was  clear that  the words "otherwise  than in  accordance with the provisions of this Act", included amounts which may have been collected by way of  tax though  not exigible  as tax  under the Act. The Court then  held that  the State Legislature was income tent to enact  a provision  like sec.  11(2) as  it  enabled  the Government to  recover an  illegal levy  and  it  could  not possibly be  said to  be an  incidental or  ancillary  power

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capable of exercise in aid of the main topic of legislation, which was,  a tax  on the  sale or  purchase of  goods.  The decision in orient Paper Mills case was distinguished on the ground that  it dealt  with a  case of  refund and  not  the collection of tax, not really due as a tax under the law. In their precise words, they said:               "The matter (In orient Paper Mills case) dealt      with a question of refund and it cannot be doubted that      refund of  the tax collected is always a matter covered      by incidental and ancillary powers relating to the levy      and collection  of tax.  We are not dealing with a case      of refund in the present case. What sec. 11(2) provides      is that  some thing  collected by way of tax, though it      is not  really due as a tax under the law enacted under      Entry 54  of List  II must  be paid  to the Government.      This situation in our 101      Opinion is  entirely different  from the  situation  in orient ,         A Paper Mills case."      The   decision    in  orient  Paper  Mills  case    was expressly affirmed  by a Bench of Seven Judges of this Court in R.S.   Joshi  v. Ajit  Mills(l) and  observations to  the contrary Ashoka   Marketing  Company case(2)  were expressly dissented from.  We are, therefore. satisfied that sec. 23-A of the  Punjab Agricultural  Produce Markets  Act was within the competence  of the Punjab  Legislature and  that  it was not also otherwise invalid in any  manner.  The appeals are, therefore, dismissed with costs. M .L.A.                                   Appeals dismissed. (1) AIR 1977 SC 2279. (2) AIR 1971 SC 946. 102