Kalwan Agriculture Produce ... vs The State Of Maharashtra, The ...
2003 Latest Caselaw 415 Bom

JUDGMENT

C.K. Thakker, C.J.

1. Rule. Mr. R.M. Patne, Assistant Government Pleader, appears and waives service of notice of rule on behalf of respondent Nos. 1 to 3. In the acts and circumstances, the matter was taken up for final hearing with the consent of parties.

2. This Writ Petition is filed by the petitioners for an appropriate writ, direction or order quashing and setting aside an order dated January 22, 2003 passed by the District Deputy Registrar, Co-operative Societies, Nashik, respondent No. 2 herein, under Section 44 of the Maharashtra Agricultural Produce Marketing (Regulation) Act, 1963 (hereinafter referred to as "the Act"), and the Maharashtra Agricultural Produce Marketing (Regulation) Rules, 1967 (hereinafter referred to as "the Rules").

3. The case of the petitioners in the petition is that petitioner No. 1, Kalwan Agricultural Produce Market Committee, is an Agricultural Produce Market Committee constituted in accordance with the provisions of the Act. Petitioner Nos. 2

Committee. Respondent No. 1 is the State of Maharashtra. Respondent No. 2 is the District Deputy Registrar to whom the powers have been delegated by the State Government in respect of amalgamation or division of Market Committees. Respondent No. 3 is the Director of Marketing, Pune, an authority having supervisory control over Register of Co- operative Societies. Respondent No. 4 is the State Agricultural Marketing Board constituted under Section 39-A of the Act.

4. According to the petitioners, petition No. 1 Committee was established in 1971 and was having a market area of 179 villages in the territorial limits of Kalwan Taluka in Nashik District. The Managing Committee of petitioner No. 1 was constituted in accordance with provisions of Section 13 of the Act. On or about June 23, 1999, a notification was issued under the Maharashtra Land Revenue code, 1966 by which certain villages were carved out from Kalwan Taluka and another Taluka named Deola Taluka came to be established. Our of 179 villages which were with petitioner No. 1, 29 villages were included in Deola Taluka and remaining 150 villages continued to remain in market area of petitioner No. 1.

5. According to the petitioners, with a view to achieving political goal, a proposal for division of petitioner No. 1 Committee into two Committees started in the year 1999 in purported exercise of power under Section 44 of the Act and a decision was taken to divide petitioner No. 1 Committee into two Committees. The proposal and the decision were strongly objected by petitioner No. 1 as well as by the villagers which compelled the State Government to revoke the decision. Thereafter, there was no proposal by the respondents to make division of petitioner No. 1 Committee into two Committees.

5. There was a fresh election of Managing Committee in 2001 and petitioner Nos. 2 to 16 were duly elected as members of Managing Committee. The tenure of the Managing Committee is five years. It is alleged by the petitioners that since persons of their choice were not elected, respondents again started initiating action of division of petitioner No. 1 Committee into two separate Market Committees. When the petitioners came to know about such move, they objected. In spite of such objection and without consulting the petitioner Committee, or the State Marketing Board and without affording opportunity of making representation against such action, a decision was taken by respondent No. 2 under Section 44 of the Act, by which petitioner No. 1 Market Committee was divided into two Market Committees, (i) Kalwan Agricultural Produce Market Committee: and (ii) Deola Agricultural Produce Market Committee. The said action is illegal, contrary to law, not in consonance with the provisions of the Act and inconsistent with several decisions of the Supreme Court as well as of this Court. The petitioners, therefore, have approached this Court by filing the present petition under Articles 226 and 227 of the Constitution of India.

6. On February 11, 2003, a mention was made to this Court to take up the matter as the petitioners wanted ad-interim relief. The matter was taken up. Notice was issued to the respondents and ad-interim relief in terms of prayer Clause (b) was granted. In prayer Clause (b), the petitioners prayed stay of execution, operation and implementation of the ordered dated January 22, 2003, passed by respondent No. 2 in exercise of power under Section 44 of the Act.

7. The respondents were then served with the notices. Affidavits and counter-affidavits were filed. Civil Application for joining parties as well as for vacating interim relief were also filed and appropriate orders were passed thereon. As already stated, with the consent of parties, we had taken the matter for final hearing.

8. In the affidavit in reply filed by the Chairman, Deola Agricultural Produce Market Committee, it was stated that action was taken by the second respondent in exercise of power under Section 44 of the Act and the petitioners have no right to make grievance against such action. It was also stated that the process of bifurcation and division of Kalwan Agricultural Produce Market Committee was not a development of "over night". It had started in 1999 when a separate Taluka, viz. Deola Taluka, came to be established. The Marketing Board vide its letter dated July 3, 1999, informed the Director of Marketing that in the 61st meeting of the Directors of Agricultural Marketing Board held on 30th June, 1999, the issue was discussed that Kalwan Agricultural Produce Market Committee should be bifurcated into two Committees, and the said action would be financially viable. The Marketing Board had approved it and gave its consent for such bifurcation. A copy of the letter is annexed to the affidavit. The deponent further stated that the second respondent sent a report/proposal dated August 1, 2002 to the Government of Maharashtra for such division. The Director of Agricultural Marketing vide his letter dated August 12, 2002, informed the General Manager of Maharashtra State Agricultural Marketing Board that the second respondent had sent a proposal on August 1, 2002, regarding division of Agricultural Produce Market Committee at Kalwan and Deola. The second respondent vide his letter dated August 29, 2002, submitted his report to the Government in favour of division. The Maharashtra State Marketing Federation vide its letter dated September 7, 2002, informed respondent No. 2 that a meeting of Board of Directors of Marketing Federation was held on 22nd August, 2002 in which the proposal was discussed and a recommendation was made for such division. It was denied by the deponent that there was no proper consultation or the action was otherwise arbitrary or illegal. Even petitioner No. 1 had discussed the proposal for its division on January 24, 2002 and bifurcation was proposed. It was, therefore, prayed that the petition deserves to be dismissed.

9. A counter affidavit is also filed by Assistant Registrar, Co-operative Societies, Nashik on behalf of Respondent No. 2. It was stated in the said affidavit that the procedure of bifurcation of Agricultural Produce Market Committee, Kalwan into two Committees; Kalan and Deola started in 1999. At that time, however, the Government reviewed the decision of bifurcation, and hence the process was stopped. Regarding consultation with the Market Committee and the State Marketing Board, it was denied that there was no consultation. Respondent No. 2 had forwarded Resolution No. 8 dated January 24, 2002, to the Government which showed effective consultation with Market committee by respondent No. 2. The proposal of bifurcation was sent through respondent No. 3, Director of Marketing, Pune, to respondent No. 4 i.e. State Marketing Board, who conveyed its decision by a letter dated September 7, 2002. Thus, there was effective consultation with the Marketing Board. Referring to the phraseology used in Section 44 of the Act that "the State Government 'may' after consulting the Market Committees or Committee as the case may be and the State Marketing Board", it was submitted by the deponent that the provision regarding consultation was not "mandatory". However, the facts revealed that there was such consultation. It was, therefore, submitted that the action taken by the authorities was in accordance with law and the respondents had no right to challenge it. The petition, therefore, deserve to be dismissed.

reiterated what was stated in the petition. It was also stated that after the election of new Managing Committee on December 21, 2001, first meeting for electing Chairman and Vice-Chairman was held on January 10, 2002. On January 17, 2002, an agenda of meeting scheduled to be held on January 24, 2002, was issued. There were in all seven subjects on the agenda. The subject regarding proposed action of division of Agricultural Produce Market Committee was no included. At the time of meeting. however, a reference was casually made by some of the members and the matter was discussed. There was no resolution approving the proposed action. One Mr. Popat had opposed the proposal of division of Agricultural Produce Market Committee. The State Government called a report vide its letter dated July 11, 2002 about the feasibility of division of Agricultural Produce Market Committee. The said letter was also referred to in the report dated August 1, 2002 submitted by respondent No. 2 to the State Government. On the basis of the said report, the Director of Marketing wrote a letter on August 12, 2002 to respondent No. 4 for its opinion as to whether such division would be economically

prepared a report regarding economic feasibility of the division. Surprisingly, however, by a letter dated September 7, 2002, a Resolution approving the proposed action was taken. Thus, there was nothing to show that petitioner No. 1 Committee or the State Marketing Board was ever consulted. The action was, therefore, illegal and contrary to law.

11. We have heard the learned counsel for the parties. Mr. P.N. Joshi, the learned counsel for the petitioners contended that the action is illegal, unlawful and inconsistent with the provisions of Section 44 of the Act and deserves to be quashed. He submitted that it is settled law that before bifurcation or division of an Agricultural Produce Market Committee, the State Government is bound to consult the Market Committee or Committees and also the State Marketing Board, which has not been done in the instant case. The counsel urged that there was non-application of mind on the part of the State in not giving due importance to the condition precedent that such an action would be required for "securing efficient regulation of marketing of agricultural produce in the marketing area". In absence of such satisfaction, proceedings could not have been initiated under Section 44 of the Act. The action is also mala fide and has been taken in colourable exercise of power, since some of the persons who were elected as members of the Managing Committee were not liked by the respondents. The action would adversely affect petitioner Nos. 2 to 16, as they had been elected as members of the Managing Committee only in December, 2001 and the tenure of such office is five years. The impugned action curtail that statutory period which could not have been done. On all these grounds, it was submitted that the impugned decision deserves to be quashed and set aside.

12. Mr. C.J. Sawant, Senior Advocate, appearing on behalf of the intervenors supported the action taken by the respondents. It was submitted that

Committee as well as with the State Marketing Board. It was at the instance of petitioner No. 1 Committee which had passed a Resolution favouring and recommending division of Kalwan Agricultural Produce Market Committee into two Committees, Kalwan and Deola, that the proceedings were initiated. The Marketing Board was also of the same opinion and on the basis of such decisions, the action was taken under Section 44 of the Act. Neither petitioner No. 1 Committee nor petitioner Nos. 2 to 16 have right to challenge legal and valid exercise of power by the authorities. It was submitted that it is well settled that consultation does not mean concurrence or consent, and even if it is assumed for the sake of argument that petitioner No. 1 or petitioner Nos. 12 to 16 did not agree to such division, statutory power under Section 44 could be exercised by the authority, provided conditions laid down therein were fulfilled. According to the counsel, the action was in exercise of statutory power which did not deprive the petitioners of any benefit nor resulted in civil consequences. It was, therefore, not necessary to issue show cause notice, call for explanation, afford opportunity of hearing or observe principles of natural justice. An action of supersession of a body stands on a totally different footing and considerations relevant to supersession would not apply to amalgamation or division of Committee. It was also submitted that even in past, there was such proposal for division of Marketing Committee. Hence, the action can never be termed as mala fide or colourable exercise of power. It was, therefore, submitted that the decision does not deserve to be interfered with by this Court in exercise of extraordinary jurisdiction under Article 226 of the Constitution.

13. Mr. Patne, learned Assistant Government Pleader, supported the stand taken by Mr. Sawant. He submitted that even in past such exercise was undertaken but petitioner No. 1 Committee approached this Court. This Court entertained the petition and granted interim relief. Thereafter, once again the process was undertaken and in bona fide exercise of power and after consulting the Market Committee and the State Marketing Board, the present action has been taken, which is legal and valid.

14. Having heard the learned Counsel for the parties, in our opinion, on a short ground of non-compliance with the conditions laid down in Section 44 of the Act, the petition deserves to be allowed.

15. Section 44 of the Act provides for amalgamation or division of Market Committees and it reads as under:

Amalgamation or division of Market Committees.--(1) Where the State Government is satisfied that for securing efficient regulation of marketing of any agricultural produce in any market area, it is necessary that two or more Market Committees therein should be amalgamated or any Market Committee therein should be divided into two or more Market Committees, then the State government may, after consulting the Market Committees or Committee, as the case may be, and the State Marketing Board by notification in the Official Gazette, provide for the amalgamation or division of such Market Committees into a single Market Committee or into two or more Market Committees, for the market area in respect of the agricultural produce specified in the notifications with such constitution, property, rights, interests and authorities and such liabilities, duties and obligations (including provision in respect of contracts, assets, employees, proceedings, and such incidental, consequential and supplementary matters as may be necessary to give effect to such amalgamation or as the case may be, the division) as may be specified in the notification."

(2) Where more Market Committees than one are established in any market area under Sub-section (1), the State Government may, notwithstanding anything contained in this Act, issue general or special directions as to which of the Market Committees shall exercise the powers, perform the duties and discharge the functions of the Market Committee under this Act, in which they are jointly interested or which are of a common nature.

(3) Where any direction are issued under Sub-section (2), the cost incurred by a Market Committee in pursuance of the directions shall be shared by the other Market Committees concerned in such proportion as may be agreed upon, or, in default of agreement, as may be determined by the State Government or such officer as that Government may direct in this behalf. The decision of the State Government of such officer shall be final."

Now, it cannot be gainsaid that whenever an Act provides for consultation with the bodies likely to be affected, such consultation is mandatory and not directory. Moreover, such consultation must be real, effective and meaningful (vide Chandramouleshwar Prasad v. High Court of Patna, ; Union of India v. Sankalchand Himatlal Sheth, ; S. Kewal Ram v.

District Registrar of Co-operative Societies, (1986) 2 SCALE 398; Agricultural Produce Market Committee, Dharni and Ors. v. District Deputy Registrar, Co-operative Societies, Amravati, 1986 Mah LJ 374; Shalikram Shivram Khabragade and Ors. v. Divisional Joint Registrar, Co-operative Society, Nagpur and Ors., ; and Vithal Sampatrao Fartade v. State of Maharashtra and Ors. W.P. 2864 of 2001 decided on January 29, 2003). It, therefore, cannot successfully be contended that consultation is directory, enabling or permissive. Section 44, no doubt, uses the expression "may", but considering the ambit and scope of the provision and keeping in mind the fact that such power can only be exercised to achieve the object et out in the said section, it must be held that no action can be taken by the State Government before consulting the Market Committee or the State Marketing Board.

16. Moreover, the point is concluded by more than one decision of this Court. It may be profitable to refer to a recent decision in Appasaheb Sheshrao Chavan and Ors. v. State of Maharashtra and Ors., . In Appasaheb Sheshrao, several petitions were filed against the decision of bifurcation of Committees. The Court was called upon to consider whether the provision relating to consultation was mandatory? Considering the relevant provisions of law, this Court held that consultation with the bodies referred to in the Act was mandatory, and final decision can be taken only after such consultation. A decision taken without consulting such bodies could not be said to be a decision in the eye of law and must be declared void and non-est. Though, some of the petitions were dismissed, other petitions were allowed by the Division Bench holding that there was no consultation with the Committee on the proposal of bifurcation or division of Committees. For instance, in Writ Petition Nos. 4436 of 1998 and 4912 of 1998, the Court held that bifurcation of Pathri Committee into two separate Market Committees viz. Pathri and Hadgaon had been done without consultation. No doubt, it was stated that a Resolution was passed in the meeting dated 17th June, 1998 regarding bifurcation of Committees, but it was not a subject in the agenda of the meeting and the question was not discussed. The Court also noted that it was contended by the petitioners that the power to be exercised under Section 44 of the Act must precede by the procedure calling for objections, if any, from all those likely to be affected. As it was not done, the action was illegal and contrary to law. Similarly, in Writ Petition No. 5003 of 1998, Jalna Market Committee was bifurcated into two market Committees, Jalna Market Committees and Badnapur Market Committee. The Director of Market Committee informed the Government about bifurcation of the said Committee on February 17, 1995. The communication was considered in a meeting dated April 28, 1995 by the Market Committee and the proposal was opposed. The Chairman of the Committee expressed the opinion in favour of bifurcation. It was held that such action could not be said to be in consonance with law. Hence, the order was set aside. The Court also observed that the consultation must be real, effective and meaningful and in the absence of such consultation, the action cannot be said to be in accordance with law.

17. In the instance case also, reliance was sought to be placed on a Resolution dated January 24, 2002 (Exhibit-C). An English translation is supplied by the learned Counsel for the petitioners. In the said Resolution, it was stated that a general meeting of petitioner No. 1 Committee was held on that day, i.e. on January 24, 2002 and Resolution No. 8 was passed. It is clear from the agenda of the meeting that bifurcation of Committee was not one of the subjects to be discussed nor was it incorporated in the agenda which was prepared on January 17, 2002. The subject was taken as an additional subject with the permission of the chair on the date of the meeting. From Resolution No. 8 also, it is clear that no decision regarding bifurcation or division of Kalwan Agricultural Produce Market Committee into two Committees viz. Kalwan and Deola was taken and the action was approved but the matter was discussed and unanimously a note was taken regarding such discussion.

18. The relevant sentence reads as under: ojhy izek.ks ppkZ dj.ksu vkyh- ckcu uksn /ks.;ku ;koh vls lokZuers Bjys-

The English translation as supplied reads thus:

"The discussion took place as above. It was unanimously agreed to take note of this matter."

It further appears that though at the end it was stated that the Resolution was passed unanimously, from the body of the Resolution, it is clear that the proposal was opposed by Popat Dhana Khairnar Upasabhapati of the Samiti. Thus, it cannot be said that on January 24, 2002, a decision was taken by petitioner No. 1 Committee and a Resolution was

Committee into two Committees. It is, therefore, not correct to say that a decision was taken regarding bifurcation as has been submitted by the respondents, that petitioner No. 1 Committee had agreed and passed a Resolution for division of Kalwan Committee into two Committees.

19. Even on interpretation of law, the action cannot be said to be in accordance with law. In our opinion, the learned counsel for the petitioner is right in contending that petitioner No. 1 Committee was required to be consulted on the proposal regarding amalgamation or division of Market Committee. It is only after such proposal is mooted out that Market Committees or Committee, as the case may be, and the State Marketing Board should be consulted. As is clear from the record and even admitted by the respondents that the proposal started from August 1, 2002 by a communication of respondent No. 2 to respondent No. 1-the State of Maharashtra. Thereafter on August 12, 2002, the Director of Agriculture, Marketing, on August 12, 2002, informed the General Manager of Maharashtra State Agricultural Marketing Board as well as respondent No. 2 regarding dividing or bifurcating Agricultural Produce Market Committee, Kalwan, into two Agricultural Produce Market Committees, Kalwan and Deola. Hence, what was required by law was the consultation of petitioner No. 1 Committee as also State Marketing Board in connection with the proposal dated August 1, 2002. Any action taken prior to August 1, 2002, could not be said to be in exercise of power under Section 44 of the Act. Therefore, even if any Resolution was passed earlier to such proposal, it could not be said to be in accordance with the provisions of the Act. A division or bifurcation of Committees required to be made under Sub-section (1) of Section 44 as regarding the proposal of bifurcation or division. Since that proposal was moved on August 1, 2002, the consultation would be only after August 1, 2002 and before the impugned order dated January 23, 2003. As no consultation had ever been made during the said period, the contention of the learned counsel for the petitioners must be upheld that there was no consultation and the order deserves to be set aside.

20. For the foregoing reasons, in our opinion, the petition deserves to be allowed and is accordingly allowed. The order dated January 22, 2003 passed by respondent No. 2 is hereby quashed and set aside. Since we are upholding the contention of the learned counsel for the petitioners that there was no consultation with the petitioner No. 1 Committee as envisaged by Sub-section (1) of Section 44 of the Act and the action deserves to be quashed and set aside on that ground, we are not expressing any opinion on mala fide or colourable exercise of power on the part of the respondents, as contended by the petitioners. The petition is accordingly allowed. Rule is made absolute. In the facts and circumstances, however, there shall be no order as to costs.

Parties be given copies of this order duly authenticated by the Sheristedar/Private Secretary.