JUDGMENT S.R. Singh, J.
1. In this batch of writ petition filed by the licensed Rice Millers, the main question that surfaces up for consideration by the Court, is as to whether the petitioners are liable, qua the Mandi Samiti, to pay market fee on the transaction of sale of rice to the State Government under the provisions of clause 3 (1) of the U. P. Rice and Paddy (Levy and Regulation of Trade) Order, 1985.
2. Petitioners, it is stated, make purchases of paddy for being husked into rice both from inside and outside the market area of Krishi Utpadan Mandl Samities of Rudrapur and Villaspur, but sizeable percentage of entire paddy, it is alleged, is lifted by them from outside the concerned market areas of Rudrapur and Vilaspur, it is stated in the petition that purchases of paddy from outside the market area of Mandi Samities of Rudrapur and Vilaspur take place in those areas and the petitioners pay market fee to the concerned Mandi Samitles on transaction of sale of paddy outside the market area of the aforesaid Mandi Samities and no market fee becomes payable on the rice manufactured out of the paddy purchased from outside the market areas of Rudrapur and Vilaspur. It is their case that the market fee is payable only on one transaction of sale and since they have already paid market fee on the transaction of sale of paddy to the Mandl Samitles from where the paddy was purchased, market fee would not be payable to Mandi Samlties of Rudrapur and Vilaspur on sale of rice husked out of such paddy. According to them, market fee is payable by them only on the sale of rice which is produced out of paddy purchased inside the market areas of Rudrapur and Vilaspur. It is on the strength of these allegations that the petitioners have landed in this Court for the following bottom-line reliefs :
(i) to Issue a writ, order or direction in the nature of mandamus directing the Secretary Food and Civil Supplies. Government of U. P. to decide the issue of payment of market fee on levy rice manufactured out of paddy purchased from outside the concerned market area by the petitioners ;
(ii) to issue a writ, order or direction in the nature of mandamus directing the respondents to include the market fee on levy rice in the notified prices of rice fixed by respondent No. 1 and such levy rice which has been manufactured out of paddy purchased from outside the market area of respondent Nos. 8 and 9 ;
(iii) to issue a writ, order or direction in the nature of mandamus declaring that the levy price for delivery of rice fixed by the State Government in consultation with the Central Government under Section 16 of the U. P. Rice and Paddy (Levy and Regulation of Trade) Order. 1985 in exercise of its power under Section 3 (3)-B of E. C. Act in so far as it does not include the market fee on levy rice wherever It is payable, is discriminatory and violative of Articles 14 and 19(1)(g) and 300A of the Constitution; and
(iv) to issue a writ order or direction in the nature of mandamus directing the respondent Nos. 8 and 9 to suspend recovery of market fee on levy rice manufactured out of paddy purchased by the petitioners from outside the market areas of Rudrapur and Vilaspur.
3. We have heard Sri Sunil Ambwani, for the petitioners, learned standing counsel for opposite party Nos. 1 to 7 and Sri B. D. Mandhyan, for opposite parties No. 8 and 9. None has appeared for Food Corporation of India arrayed herein as opposite party No. 10.
4. The thrust of the submissions advanced by Sri Sunil Ambwani Is that the primary liability to pay the market fee under Section 17 (iii) (b) (3) of the U. P. Krishi Utpadan Mandi Adhiniyam, 1964 (In short the 'Mandi Adhiniyam') is of the purchaser and the State Government being the purchaser is liable to pay the market fee to the concerned Mandi Samities on sale of levy rice to the State Government under the Levy Order, 1985. The learned counsel propped up his submission by placing reliance on recent decision of the Supreme Court in Krishi Utpadan Mandi Samiti, Haldwani etc. etc. v. India Wood Product Ltd. and another, JT 1996 (4) SC 8. In opposition, the learned standing counsel and Sri B. D. Mandhyan, appearing for the opposite parties launched into a polemical submission and canvassed that the petitioners were liable to pay the market fee on sale of levy rice produced from paddy purchased by them outside the market area, as well as on sale of the levy rice produced out of paddy purchased inside the market area of the concerned Mandi Samiti although they have the right, under clause (3) of Section 17 (iii) (b) of the Mandi Adhiniyam. to realise the market fee from the purchaser, namely the State Government. Sri B. D. Mandhyan put his weight behind the Five Judges Bench decision of the Supreme Court in Ram Chandra Kailash Kumar and Co. and others v. State of U. P. and another, 1980 (Suppl.) SCC 27.
5. In order to appreciate the submissions made across the bar. it would be worthwhile to quote Section 17 of the Mandi Adhiniyam and Section 17 in so far as it is relevant to the discussion on the issues raised in this batch of writ petitions, is abstracted below :
"17. Powers of the Committee.--A Committee shall, for the purposes of this Act. have the power to-
(i) .....................................................................
(ii) .....................................................................
(iii) Levy and Collect :
(b) market fee, which shall be payable on transactions of sale of specified agricultural produce in the market area at such rates, being not less than one percentum and not more than (two) percentum of the price of the agricultural produce so sold, as the State Government may specify by notification, and such fee shall be realised in the following manner :
(1) if the produce is sold through a commission agent, the commission agent may realise the market fee from the purchaser and shall be liable to pay the same to the Committee ;
6. A perusal of the provisions aforestated would manifest that all the four sub-clauses of clause (b) of Section 17 (iii) of the Mandi Adhlniyam are mutually exclusive modes of realising the market fee which is payable on transactions of sale of specified agricultural produce in the market area. The counsel for the parties advanced their submissions as if realisation of market fee in the instant case, could be made only in accordance with sub-clause (3) taking it for granted that the State Government purchasing rice from the petitioners under the Levy Order. 1985 is a 'trader' within the meaning of Section 2 (y) of the Mandi Adhlniyam which defines the word "trader" to mean a person who in the ordinary course of business is engaged in buying or selling agricultural produce as principal or a duly authorised agent of one or more principals and includes the person engaged in the processing of the agricultural produce. In M/s. Mahalaxmi Rice Mills v. State of U. P. and others, 1987 UPLBEC 749. a Division Bench of this Court has held that supply of rice by rice millers to Government under Levy Order. 1985 is a business activity and the State Government procuring levy rice is a 'trader'. The Division Bench of this Hon'ble Court has held that the State Government purchasing rice under the Levy Order, 1985 assumes the role of a trader keeping in view the elements Inherent in the transaction and in entering into the transaction of purchase of rice from the rice millers in the market area, the State Government too, like any other trader parties the facilities etc. which the Mandi Samiti is supposed to provide and, therefore, the Mandi Adhiniyam does not exonerate the Government from the ultimate incidence of payment of market fee. In Ram Chandra Kailash Kumar and Co. v. State of U. P., 1980 (Suppl.) SCC 27, a Five Judges Bench of the Supreme Court has held that there cannot be any multi-point levy of market fee in the same market area and the market fee can be charged only on one transaction In a particular market area. It has been specifically held therein that in a particular market area, market fee cannot be levied both in relation to the transaction of purchase and sale of paddy and the rice produced from the same paddy. It has been, however, made clear that if paddy is purchased by the rice miller from another market area, then the market committee of the area where such paddy is converted into rice and sold, will be entitled to charge market fee on the transaction of sale office in accordance with sub-clause (3) of Clause 17 (iii) (b) in that there is "nothing in the provisions of the Act or the Rules to warrant the taking of the view that In another market area, the market committee of that area cannot levy fee on fresh transaction of sale and purchase taking place in that area." Expatiating on sub-clauses (1) and (3) (b) of Section 17 (iii) of the Mandi Adhiniyam, the Supreme Court held in the case of Ram Chandra Kailash Kumar and Co. (supra) that in the case of sub-clause (1) of Section 17 (iii) (b), the Commission Agent can realise the market fee from the purchaser and the seller-trader under sub-clause (3) can realise it from the purchaser and if the market fees are realised from such persons, then in turn, they may be able to realise it from the persons on whom they could pass on the burden. The Supreme Court noticed that paddy and rice mentioned as items 3 and 4 in group 1-A 'cereals', there is a duplication as rice is obtained from paddy and while expounding legal position in this regard, the Supreme Court observed as under:
"If paddy is purchased in a particular market area by a rice miller and the same paddy is converted into rice and sold then the rice miller will be liable to pay market fee on his purchase of paddy from the agriculturist--producer under sub-clause (2) of Section 17 (iii) (b). He cannot be asked to pay market fee all over agatn under sub-clause (3) in relation to the transaction of rice. Nor will it be open to the market committee to choose between either of the two in the example just given. Market fee has to be levied and collected in relation to the transaction of paddy alone. Otherwise, there will be a risk of violation of Article 14 if it is left to the sweet will of the market committee in the case of some rice millers to charge market fee on the transaction of paddy and in case of others to charge it when the sale of rice taken place. If, however, paddy is brought by the rice miller from another market area, then the market committee of the area where paddy is converted into rice and sold will be entitled to charge market fee on the transaction of sale In accordance with sub-clause (3)."
7. It is thus no longer res-integra that a Mandi Samiti would be within Its legal brief to levy and collect market fee on any transaction of sale of rice taking place within its market area notwithstanding the fact that market fee on the transaction of sale of paddy has already been levied and collected by any other committee. The submission made by Sri Ambwani to the contrary does not commend itself for acceptance.
8. That next question that begs an answer is as to who is liable to pay market fee on sale of rice hulled from paddy brought from another market area. In M/s. Hind Rice Mills and others v. State of U. P. and others, (1991) 1 UPL8EC 269, B. P. Jeevan Reddy, C. J. (as he then was) speaking for a Division Bench of this Court, repelled the contention that sub-clause (3) of Section 17 (Hi) (b) fastens the purchasing trader with primary liability but speaking for a two-Judge Bench of the Supreme Court in Krishi Utpadan Mandi Samiti, Haldwani etc. etc. v. M/s. India Wood Products Ltd. and another. JT 1996 (4) SC 8, his Lordship held as under:
"A reading of the aforesaid provisions shows that the liability to pay the market fee is placed primarily upon the purchaser. Sub-clauses (1) and (4) expressly say so. So does sub-clause (2). (Sub-clause (2) is also consistent with the general policy underlying such enactments that the producer of specified agricultural produce is not to be made liable to pay the fee). Now. coming to sub-clause (3), with which we are directly concerned herein, it says that "trader selling the produce may realise it from the purchaser and shall be liable to pay the market fee to the committee". On the basis of the language of this sub-clause, it is contended by the purchasing dealers (who are respondents in these appeals) that the levy in such a case is upon the selling trader and that it is for him to pay the market fee. It is submitted that such selling trader may collect the fee from the purchaser or he may not. whether the selling trader collects it from the purchaser or not, it is he who is liable to pay the market fee since the levy is upon him. it is submitted. We are unable to agree with the submission. A reading of the several sub-clauses shows, as mentioned hereinbefore, that the liability to pay the market fee is always upon the purchaser. It is no different in sub-clause (3). If the ultimate liability was not upon the purchaser, there was no meaning in the Legislature saying that the selling producer may realise the fee from the purchaser and make it over to the Committee. The use of the word "shall" in the said clause means that where the selling trader realises the fee from the purchasing trader, he is bound to make it over to the Committee. But where the selling trader does not realise it from the purchaser, he is under no obligation to pay the market fee to the Committee. In such a case, the liability to pay the market fee is upon the purchasing trader. This interpretation in our opinion, accords with the scheme of clause (b) of Section 17(iii) of the Act."
9. Our reading of Section 17 (iii) (b) of the Mandi Adhiniyam sheds light on the fact that it is an amalgam of substantive as well as procedural piece of legislation. It creates rights and liabilities inter se between the Mandi Samiti, the seller and the purchaser in relation to transaction of sale of specified agricultural produce in a particular market area on one hand and imposes/enjoins an obligation on persons referred to in sub-clauses (1) to (4) of clause (b) to pay the market fee to the Committee on the other. It creates a right in favour of the Mandi Samiti where the transaction of sale takes place to levy the market fee on the transaction of sale of specified agricultural produce at a rate specified by the State Government by means of a notification and provides the modes of recovery under sub-clauses (1) to (4) of clause (b). While there is no Indicia of any controversy as to who is liable, vis-a-vis, the Mandi Samiti, to pay market fee so far as sub-clauses (1), (2) and (4) are concerned, there is certainly a thick mist of obfuscation hanging over the fact as to who is liable to pay the market fee to the Mandi Samiti. under sub-clause (3) of clause (b) of Section 17 (iii) of the Act. In the backdrop of the ratio flowing from Division Bench decisions of this Court copiously cited supra, the selling trader may be fastened with the liability, vis-a-vis the Mandi Samiti, to pay the market fee under sub-clause (3) and to us also that appears to be the import of the expression "the trader selling the produce.....shall be liable to pay the market fee to the Committee" used in sub-clause (3) of clause (b). The liability is of course coupled with the right to recover the market fee from the purchaser. But the Supreme Court in the latest decision referred to above, has ruled that the selling trader shall be liable to pay the market fee to the Committee only if it has realised the same from the purchasing trader and in case he has not collected the same from the purchasing trader, he would not be so liable to pay to the Committee and we feel bound by it. Sri B. D. Mandhyan attempted to drum home the point that the two-Judges Bench decision of the Supreme Court in Krishi Utpadan Mandi Samiti, Haldwani has been rendered sons noticing the earlier five Judges Bench decision of the Court in Ram Chandra Kailash Kumar (supra). It brooks no dispute that observations such as "rice millers will be liable to pay market fee" made by the Supreme Court in Ram Chandra Kailash Kumar (supra) does denote that the Committee can realise market fee from the selling trader but in Ram Chandra Kailash Kumar, (supra), the Supreme Court focussed its attention more on the question as to whether, in the case of sale of rice, market fee can be levied only at one point, i.e., at the point of sale of the paddy or can it be levied also at the point of sale of rice hulled from the paddy on the purchase of which market fee has already been paid than on the issue as to who is the person liable to the Committee to pay the market fee, white in the case of Krishi Utpadan Mandi Samiti, Haldwani (supra), the Supreme Court was directly concerned with the question as to when a selling-trader could be fastened with the liability to pay market fee to the Committee under sub-clause (3) of clause (b) of Section 17 (iii) of the Mandi Adhiniyam. The latter decision of the Supreme Court having been rendered de hors noticing the earlier five Judges Bench decision, could have been discounted by reasons of the ratio of Muthu Lal v. Radha Lal, AIR 1974 SC 1596, had there been any conflict between the two but as noticed above, the question which was precisely raised In the subsequent decision, was not directly traversed upon and answered in the former decision rendered by the larger Bench and. therefore, this Court has got no option but to abide by the decision of the Apex Court in Krishi Utpadan Mandi Samiti. Haldwani (supra) and hold that if the price of levy rice paid to the petitioner is not Inclusive of the market fee, then in that event, the State Government shall be liable to pay market fee to the Samiti and not the petitioners. In case, however, the price of levy rice paid to the petitioners, included the market fee, then in that event the concerned Mandi Samities shall be entitled to realise the same from the petitioners and the demand notices issued to them cannot be demurred to.
10. The stand taken in vindication by the petitioners is that the price of levy rice paid to them is not Inclusive of market fee. The Division Bench of this Court in Mahalaxmi Rice Mill's case (supra), noticed the 'note' appended to clause 16 of the Levy Order, 1985 and observed as under :
"Included within the prices of rice, therefore, is Mandi tax on paddy and significantly not rice. Before us is the question of market fee payable on rice supplied to the State Government under the Levy Order, 1985 milled of paddy purchased from outside the market area. The price thereof is not Inclusive of market fee. It indeed does not behave the State Government not to carry out the statutory liability imposed upon it under Section 17 (iii) (b) (3). This litigation may have been averted if only the State Government had duly paid off the market fee to the Mandi Samiti. We hope and trust that there would be no dilly dallying further on part of the State Government in paying off its dues to the trader-sellers who are placed under the liability vis-a-vis the Mandi Samiti."
11. The State has not come up with any counter-affidavit. However, the stand of the respondent, as we have been able to discern, appears to be that the price of levy rice paid to the petitioner is inclusive of the market fee. Reliance has been placed on G.O. No. 5303/29-3-4-1985 Khadya Tatha Rasad Anubhag, Lucknow, dated Feb. 23, 1987 annexed as Annexure 3 to the writ petition, in which it has been trumpeted that the State Government has already reimbursed the market fee while paying the price of levy rice to the concerned traders and hence, it has been asserted though in an opaque way, traders were liable to pay the market fee to the Mandi Samiti in accordance with the G. O. No. 8747/29-Kha 4-85, dated 5th Feb., 1986, referred to in the G.O. dated 23.2.1987 (Annexure-3 to the writ petition). This being a disputed question, calls for being viewed more appropriately by the State Government and it would not be apt and proper to preempt venturing any opinion on the question as to whether any reimbursement was made to the petitioner with regard to market fee while paying the price of the levy rice, especially, when one of the prayers made by the petitioners is that the Secretary Food and Civil Supplies, Government of U. P. be directed to decide the vexed issue of payment of market fee on levy rice hulled from the paddy purchased from outside the concerned Mandi Samities and the question as to whether the levy rice sold to the State Government was manufactured by the petitioners out of paddy purchased by them outside the market area of the concerned Mandi Samiti, is again a question of fact for which this Court under Article 226 of the Constitution, is not the appropriate forum. In the circumstances aforestated, we are of the considered view that in case the petitioners have already been reimbursed by the State Government with regard to the market fee payable to the concerned Mandi Samiti, then In that event, the demand notice issued by the concerned Mandi Samities cannot be demurred to. In case, however, the prices of levy rice are not Inclusive of the market fee and the petitioners have not been reimbursed by the State Government, in that event the concerned Mandi Samities shall be entitled to realise the market fee from the State Government in accordance with the law laid down by the Supreme Court in the case of Krishi Utpadan Mandi Somiti, Haldwani (supra).
12. Accordingly, the petitions are disposed of with the directions that the Secretary to the State Government in the concerned department, shall, after notice to the petitioners, weigh up the question referred to above and reach a decision by a speaking order within a period not exceeding four months from the date of receipt of a certified copy of this order and till then, recovery pursuant to the impugned demand notice shall remain in abeyance. Needless to say that in case it is found that the price of levy rice is not inclusive of the market fee and the petitioners have not already been reimbursed by the State Government in respect of the market fee, in that event the State Government shall pay the market fee to the concerned Committee within two months of its decision on the vexed questions of fact referred to above.