Ram Chand & Ors Vs. State of Punjab & Ors  INSC 218 (8 February 1996)
Reddy, B.P. (J) Jeevan Reddy, B.P. (J) Kirpal B.N. (J) Kirpal, J.
1996 AIR 1406 1996 SCALE (2)159
CIVIL APPEAL NO.2945/1996 (Arising out of S.L.P.(C) No. 10997 of 1995) Parduman
Chand Bhandari & Ors. V. State of Punjab & Ors. WITH CIVIL APPEAL NO.2946/1996 (Arising out of S.L.P.(C) No.
9992 of 1995) Kartar Singh Gajinder Singh & Ors. V. State of Punjab & Ors. WITH CIVIL APPEAL NO.2947/1996
(Arising out of S.L.P.(C) No. 24712 of 1995) Guru Nanak Fruit Company &
Ors. V. State of Punjab & Ors.
question which arises for consideration in these appeals is that when a market
yard is shifted from one site to another whether the licensees working in the
old market yard, are entitled to have new sites in the new market yard, as a
matter of right by virtue of their being earlier in business or whether they
have also to compete with the general public in open auction for acquiring land
in the new market yard.
aforesaid question of law is common in all the present appeals. Appeals arising
out of Special Leave Petition (c) Nos. 10997 of 1995 and 11139 of 1995 pertain
to market in Jagraon. appeal arising out of Special Leave Petition (c) No.
24712 of 1995 is with regard to Fazilka.For the purpose of deciding the point
in issue, it is sufficient to refer to facts pertaining to Jagraon only, as the
facts regarding Ludhiana and Fazilka are similar, barring
minor details. Which are not relevant.
the provision of Section of the Punjab Agricultural Markets Act, 1961
(hereinafter referred to as the Act'). Jagraon was declared as a notified
on 23.8.1963. old grain market (hereinafter referred to as `the old Mandi'). Jagraon
was declared as a principal market yard under Section 7 of the Act by the State
of Punjab. The appellants herein are persons
who had obtained licences as commission agents for carrying on their business
of sale and purchase of agricultural produce. It is the case of the appellants
that they were owners/tenants and were licensees of shops which were situated
within the old Mandi. The State of Punjab on 27.3.1978. under Section 7 of the Act. declared a new grain market. Jagraon
(hereinafter referred to as 'the new Mandi') to be established as a sub- market
yard. On 17.9.1984, by Notification issued under Section 7 of the Act, the old Mandi
was denotified as the principal market yard. By another Notification of the
same date, the Punjab Government declared the new Mandi as the principal yard
under Section 7 of the Act. This was followed by Notification of the Punjab
Government under Section 8 of the Act, issued on 30.3.1988, whereby it was
directed that no transaction in agricultural produce would be transacted within
the 5 k.Ms. of the new Mandi.
promulgation of the aforesaid Notifications gave rise to the filing of a number
of writ petitions before the Punjab & Haryana High Court. With regard to Jagraon,
the first Writ Petition (C) No. 6174 of 1988 was filed by 92 dealers of the old
Mandi of Jagraon on 26.7.1988 in favour of the petitions(appellants herein).
This petition was dismissed on 26.7.1990 by the Single Judge and Letter Patent
Appeal No. 1107 of 1990 was filed. In the meantime Civil Writ Petition No. 4199
of 1991 was filed on 18.3.1991 by the dealers of Sirhind. Patiala. The said petition was admitted and
referred to the full Bench and, in that case also, interim stay was granted.
dated 2.3.193 was issued by the Punjab Mandi Board to the effect that the
dealers/licensees will arrange for themselves plots in the new Mandi. Jagraon.
This was followed by Notices dated 18.10.1993 which were issued by the Punjab
State Agricultural Marketing Board to some of the dealers. In these Notices. reference
was made to the Notification issued under Sections 7 & 8 of the Act and the
dealers/licensees were directed to shift to new Mandi for the purposes of
conducting the business of sale and purchase of agricultural produce. Aggrieved
by these Notices, 149 dealers, including the appellants in the appeal arising
out of Special Leave Petition (C) No. 11139 of 1995, filed civil Writ Petition
No. 15831 of 1993. It appears that 16 of these petitioners were the petitioners
in the first Writ Petition No. 6174 of 1988 but the fact of filing of earlier
Writ Petition was not disclosed in this petition Civil Writ Petition No. 15831
of 1993 was admitted and was also referred to the full Bench and in the
meantime interim shay was granted.
17.2.1994, an order was passed by the Division Bench of the Punjab & Haryana
High Court High Court in Civil Writ Petition No. 15831 of 1993 vacating the
interim stay on the ground that the said 16 persons (wrongly mentioned as 19 in
the High Court's order) had not disclosed that they had joined in the filing of
earlier Writ Petition No. 6174 of 1988. The interim orders were, therefore,
vacated because of the concealing of this material fact, Special Leave Petition
(c) No. 12306 of 1994 was filed in this court against this order and the same
was dismissed on 16.8.1994.
30.5.1994, yet another Writ Petition being civil Writ Petition No. 7211 of 1994
was filed purporting to challenge the constitutional validity of Section 8 of
the said Act. It appears that out of these petitioners. 34 were those who were
party to the earlier Writ Petition. While admitting this petition interim stay
was granted. This Writ Petition was dismissed by a Single Judge on 4,9.1995 for
the reason that the petitioners had deliberately withheld the facts from the
Court and had succeeded in misleading the Court to pass interim orders in their
favour. Furthermore, it was observed that the conduct of the petitioners who
had filed successive petitions to challenge various Notifications issued under
Section 7(2) and 8 of the Act on one ground or the another was condemnable and,
therefore they had disentitled themselves from hearing of the case on merits.
While dismissing the Writ petition, cost of Rs., 20,000/-was also imposed The
main grievance before the High Court in all the petitions which were filed was
to the effect that the licensees had applied to the Government of Punjab for
allotment of alternative sites in the new Mandies on no profit no loss basis.
The licensees had challenged the selling of the plots in the new Mandies by
open auction. It was contended that in case the auction takes place, the
licensees would be compelled to shift their business to the new Mandies even if
they fail to buy plots in competition with other non-licensees on higher rates
and, in the welfare state while making plan for establishment of a new Mandi,
the State Government should not act with the motive of profit earning and that
the petitioners/licensees should be allotted plots first and only the remaining
plots should be auctioned. It was contended that the application for allotment
of alternative sites on no profit no loss basis having rejected by the State
Government the same had resulted in violation of the petitioner's fundamental
rights under Articles 14, 19(1)(g) and 31 of the Constitution of India.
Punjab Mandi Board, in its written statement filed before the High Court,
raised preliminary objection that the writ petition was highly belated. The
process of sale of the plots/spaces in the new Mandi began as far back as in
the year 1986 and allottees had taken possession and had either raised or were
in the process of raising structures upon them and to disturb the process of
formation of new Mandi at this belated stage would cause great harm. It was
admitted that the appellants were licensees carrying on their business in the
old Mandi. However, it was pleaded that the old Mandi was not a planned Mandi
and was grossly inadequate for the needs of the farmers and the public and the
formation of the new Mandi was on the request of the farmers and had all modern
amenities and facilities. Further the business of the Mandi was being carried
out in an over- crowded area of the town within the municipal limits. It was
also pleaded that the appellants do not have any prior claim to the plots in
the new Mandi which were being sold in open auction and the appellants were at
liberty to compete in open auction and purchase the plots and space and the
appellants, as old licensees, had no legal or preferential right to get the
plots by allotment. Nor there was any legal obligation on the part of the
respondents to provide alternative sites to the appellants. It was further
pleaded that the appellants had no such fundamental right and none of the
fundamental rights of the appellants had been violated and that nobody had
interfered with their ownership in the premises in the old Mandi. The State of Punjab and the Administrator. New Mandi Township in their joint written statement pleaded that the plea of
allotting plots on reserve price had been thoroughly examined at all levels of
the Government, at different times, and it was considered more suitable to sell
the plots in open auction only. It was denied that the auctioning the plots in
the new Mandi would result in the appellants being up-rooted or that they had
any legal right for allotment of plots Further the policy of the State
Government was only to sell the plots in open auction to the public at large.
It was further pleaded that there was no policy of the State Government to
allot the plots in the new mandi: that the appellants could not be allotted
plots and they could purchase the same in open auction, which in no way was
unconstitutional and that the demands of the appellants for allotment of plots
was neither legal nor justifiable. It was also denied that the motive of the
State Government was profit earning. Since the Government was determined not to
preserve the monopoly of the existing Commission Agents and with a view to free
farmers from the exploitation/malpractices fampart in the trade, carried out in
old Mandi where there was no space for unloading of good-trains it had been
decided to sell the plots by public auction. In rainy season, water collected
up to knee level in the old Mandi which resulted in damaging the produce of the
poor farmers. It was also pleaded that the appellants were not entitled to get
plots in new Mandi as they would not be removed from their existing shops in
the old Mandi or compelled to shift their business in the new Mandi. Further,
the existing sub-yard or the old Mandi would not be abolished. It was denied
that the action of the respondents to sell the plots in public auction is violative
of Articles 14, 19(1)(g) and 31 of the constitution of India.
impugned judgment dated 20.12.1994, the full Bench of the High Court while
dismissing the Writ Petitions and Letter Patent Appeals, came to the following
view of the above discussion, we are of the considered view that the ousters of
the old Mandi are not entitled to get plots/sites in the new Mandi as a matter
of right by virtue of their being earlier in business for sale and purchase of
agricultural produce particularly when there was sufficient time gap between
the denotification of the old Mandi notification of new Mandi as a principal
market yard on one hand and Notification under Section 8 of the Act on the
other hand, where after notification of the new Mandi all the sale and purchase
of agricultural produce within a specified distance from the new principal
market yard is prohibited and the State of the competent authority had already
made provisions for adequate number of plots/open sites in the new mandi and
the plots made available in the new Mandi are sold in open auction giving equal
opportunity to the licensees and other persons from the public who wanted to
enter in the trade of purchase and sale of agricultural produce in the new Mandi.
Apart from that the fact that aggrieved persons including the petitioners had
been given two months time by the Single Bench to shift their business to the
new Mandi would also be a most relevant factor for determining the right of the
ousters from the old Mandi for getting plots or sites in the new Mandi. We are
further of the view that the sale of plots in the new Mandi by public auction is
the best method for giving such plots and would be preferable to the allotment
of plots to such ousters by pick and choose method. Thus in order to get new
sites or plots in the new Mandi, in our view, the ousters of the old Mandi
shall have to compete with general public in open auction." On behalf of
the appellants, three contentions have been raised by Mr. R.K.Jain the learned
counsel while relying upon the order of this Court dated 9.5.1995 in Appeal
arising out S.L.P (c) No. 20644 of 1993 Harbans Lal arising out of S.L.P (c)
No. 5229 of 1994 Lachman Das Sunder of plots in the new Mandies at Ferozepur
and Rajpura, it was submitted that in the present case also alternative sites
should be allotted at the concessional rates or on lease to the appellants. In
the said order it was, inter alia, stated that the auction already held in the
new Mandies will not be affected. A person who was an existing licensee would
be allotted a plot in the new Mandi on payment of a lump sum of Rs. 1.65,000/-
for Ferozepur and Rs. 2.50,000/- for Rajpura.
second submission was that the State was duty bound to provide to the existing
licensees a place to do business at the reasonable prices in the new Mandi and
without such provision being made, the old Mandi cannot be stopped from
functioning. It was, lastly, submitted that the State cannot adopt a procedure
of allotment in the new Mandi by which the existing licensees can be thrown out
of business all together by forcing them to compete with outsiders. including
the properly dealers.
aforesaid order dated 9.5.1995 can be of no assistance to the appellants.
Firstly, the order was passed with the consent of both the parties, which
consent is lacking in the present case, Secondly, the order specifically states
that the same "shall not be treated as precedent". Faced with this.
Mr. Jain contended that even though the said order may not be regarded as a
precedent nevertheless the State which had earlier agreed to allot plots to the
existing licensees in Ferozepur and Fazilka cannot take a different stand with
regard to the establishment of new Mandies in other parts of the State.
is no force in this contention. What are the circumstances, which led the State
to agree to the passing of the consent order are not known. Furthermore the
contention of the appellant is that the alternative sites should be sold to
them at the reserve price plus 25%. In the aforesaid order, however, this
formula was not adopted and the court had directed the proposed sites to be
allotted on lump sum payment of Rs. 1,65,000/- per plot in Ferozepur Mandi and Rs.
2,50,000/- per plot in Rajpura Mandi.
to the Advocate General, the State had agreed to the passing of the consent
order inasmuch as on 24.9.1995 a letter had been written by the Government to
the effect that allotment of plots in the new Mandies will be made at the
reserve price plus 25% to all Artias. By another letter dated 26.9.1985 the
aforesaid decision of the Government was withdrawn Auction at Ferozepur was
notified for 4.12.1985 while in Rajpura, auction was held on 10.11.1986. The
State Government, it was submitted by the Advocate General, had consented to
sell all the plots at fixed price in favour of the appellants therein and not
be auction because of the aforesaid letter dated 24.9.1985. It was further
contended that the transfer was to be at price which was above the reserved
price and the figure of Rs. 1.65,000/- and Rs.2.50,000/- in respect of Rajpura
was stated to have arrived at by taking the average of the auction prices which
had been realist on the auction of the other plots in the said Mandies. It is
clear, therefore that the aforesaid order of this court can give no right to
the appellants to the allotment of land at a concessional rate.
support of this contention that the State was bound to provide alternative
sites at the reasonable prices in the new Mandi to the existing licensees. Mr.Jain
relied upon an order dated 7.8.1991 passed in civil Appeal Nos. 3194-95 of In
that case the State of Haryana had a policy whereby 45% of the available
accommodation at the new site was reserved for the existing licensees which was
to be allotted on the basis of lots to be cast. In this connection if was
observed that normally once the Government starts regulating the place of sale
of agricultural produce covered by the Act and does not permit any other place
to be used for the purpose, there is an inherent obligation on the Government
to provide at the new site for all the licensed dealers sufficient
accommodation for carrying on their trade and until that is done it would not
be possible for the Government to direct closure of the old site". The
Advocate General is right in contending that the aforesaid observation did not
require the allotment of alternative sites to be made at the concessional
rates. In fact this was not the issue in that case. All that was observed was
that sufficient accommodation was to be provided to all the licensed dealers to
carry on their trade. Moreover the policy of allotment of sites of the State of
Punjab is different from the policy of the
State of Haryana with regard to which the order in Prem
Chand's case (supra) was passed. In the State of Punjab, all the sites are allotted by public auction. This gives
an opportunity to all the existing licensed dealers, and also to the new
entrants, to compete and obtain sites in the new Mandi. Therefore, all the
existing licensed dealers who may be having a place of business in the old Mandi
do have a right to acquire by auction sites at the new place of business in the
new Mandi. This Court never directed in Premchand's case (supra) that
alternative sites should be allotted at a reasonable price or be given on
lease. Putting new sites to auction and allowing everyone to compete would
tantamount to the Government providing an opportunity to enable the existing
licensees to shift their place of business to the new Mandi if they so desire.
Therefore the observations in Premchand's case (supra) to the effect that there
was an obligation to provide new sites for all licensed dealers would only mean
that an opportunity should be granted to the licensed dealers to acquire sites
in the new Mandi.
submitted by Mr. Jain that if alternative sites are not provided to the
existing licensed dealers in the new Mandi, they would be deprived of their
livelihood and this will result in violation of their fundamental rights under
Articles 14, 19(1)(g) & 21 of the constitution of India.
scheme of the Act and the Rules framed thereunder show that shifting of the Mandi
from one place to another without providing for an alternative site or a shop
to a licensed dealer, cannot violate any statutory or fundamental right of any
of the licensees.
not in dispute that after declaration of a notified market area under Section 6
of the Act, the State Government may notify one principal market yard and one
or more sub-market yards under Section 7 of the Act. These market yards are
established so as to enable the agriculturists to bring their agricultural
produce to the market for sale. The sale is to take place, in the markets
established in Punjab, in the manner provided by Rule 24 of the Punjab
Agricultural Produce Markets (General) Rules, 1962 (hereinafter referred to as
'the Rules') which reads as under:
"SALE OF AGRICULTURAL PRODUCE
All agricultural produce brought into the market for sale shall be sold by open
auction in the principal or sub market yard.
Nothing in sub-rule (1) shall apply to a retail sale as may be specified in the
bye-laws of the Committee.
(3) A committee
may, and on being directed by the [chairman of the Board or an officer
authorized by him] shall fix timings for the starting and closing of the
auction in respect of any agricultural produce, other than fruits and
The price of agricultural produce shall not be settled by secret signs or
secret bid and no deduction shall be made from the agreed price of the
The auction shall not be conducted by any person other than the person engaged
by the Committee:.
that under special circumstances the [chairman of the Board or an officer
authorized by him] may allow a committee to make or permit any alternative
further that nothing in this sub-rule shall apply to the auction of vegetables
The highest bid offered by a buyer at an auction and at which the seller of the
produce gives his consent to sell his produce, shall be the sale price of the
The buyer shall be considered to have thoroughly inspected the produce for which
he has made a bid and he shall have no right to retract it.
soon as the auction for a lot is over the auctioneer shall fill in the
particulars in a book to be maintained in Form H and shall secure both the
buyer and the seller or their respective representatives, whoever may be
present at the spot.
A register in form HH shall be maintained by the Committee. The agricultural
produce which remained unsold during the course of auction be entered and it
shall be obligatory for every dealer or kacha Arhtiya or commission agent, as
the case may be, to report about the unsold produce to the committee as soon as
his agricultural produce is sold]
The buyer shall be responsible to get the agricultural produce weighed
immediately after the auction or on the same day the produce is purchased by
him Land the seller or the buyer shall be liable for any damage to or loss of
or deterioration in, the produce after the auction according to the local usage
or custom for as per provisions of rule 13].
person engaged by a producer to sell agricultural produce on his behalf shall
not. act as a buyer either for himself or on behalf of another person in
respect of such produce [without the prior consent of the producer:].
The kacha Arhtiya shall make payment to the seller immediately after the weighment
Every kacha Arhtiya shall on delivery of agricultural produce to a buyer
execute a memorandum in Form I and deliver the same to the buyer on the same
day or the following day, mentioning sale proceeds plus market charges
admissible under rules and bye- laws. The counterfoil shall be retained by the kacha
that nothing in this sub rule shall apply where agricultural produce, being
vegetable or fruit, not exceeding one quintal in weight is delivered.]
In the absence of any written agreement to the contrary the sale price of
agricultural produce purchased under these rules shall be paid by the buyer to
the kacha Arhtiya on delivery of Form I.
Delivery of agricultural produce after sale shall not be made or taken unless
and until the kacha Arhtiya or, if the seller does not employ a kacha Arhtiya,
the buyer has given to the seller a sale voucher in form J, the counterfoil
whereof shall be retained by the kacha Arhtiya or the buyer, as the case may
be." It is apparent that the aforesaid Rule stipulates that all
agricultural produce brought into the market for sale shall be sold by open
auction in the principal or the sub- market yard. In order to enable the sale by
auction to take place, platforms are constructed for the producers to come and
place their produce. Establishment of a Mandi in effect means the erection of
the platforms where agricultural produce is brought and placed for sale by
auction. In order to further facilitate the purchase and sale shops are
constructed which are acquired by the licensed dealers.
the Act, nor the Rules, makes is obligatory on the State Government to
construct such shops before notifying a market yard. The existence of such
shops only make it convenient for the licensed dealers to conduct their
business. but is not essential that they must have shops within the Mandi to
enable them to carry on their business activities.
dealer is granted a licence under Section 10 of the Act which allows him to
carry on business in a notified market area. According to Rule 17(5) of the
Rules, a separate licence is required by a person for "setting up
establishing or continuing or allowing to be continued more than one place for
the purchase, sale, storage and processing of agricultural produce in the same
notified market area" In other words, a dealer having one place of
business in a notified area is required to have only one licence which would
entitled him to carry on business in any of the Mandies situated in that
notified area but, if he has more than one places of business, then for each
place he is obliged under Rule 17(5) of the Rules to have a separate licence.
Neither the Act nor the Rules requires that the place of business of a licensed
dealer must be within the precincts of the Mandi. All that he Act and the Rules
require is that the auction, for the sale and purchase of agricultural produce,
shall be within the notified market yard or sub-yard The appellants and other
licensees who are already having shops or plots in the old Mandies have not
been deprived of the same and nor are they prevented, in any manner, from
carrying on in their shops their trade or business other than that of purchase
and sale of agricultural produce in public auction. The sale of agricultural
produce by auction, as contemplated by the Act and the Rules, does not take
place in the business premises or shops of the licensed dealers even if they
are located within the Mandi. It can only take place on the platforms in the
said market yards. Once the purchase and sale take place, then bye-law 11 of
the Bye-laws framed under the Rules makes it obligatory for the buyer to lift
the agricultural produce bought by him within 48 hours of auction or purchase.
The agricultural produce brought to the Mandi by the agriculturist has thus to
be removed from the auction platforms by the buyers and there is no requirement
of law that the produce so purchased has to be stored within the Mandi itself.
Therefore as long as the licensed dealers continue to hold valid licences for a
notified area then irrespective of the locations of their shops or offices,
they are entitled to do their business even if they do not have shops within
the Mandi. This being so, the question of appellants fundamental rights under
Articles 14, 19(1)(g) or 21 of the constitution of India being violated do not
decision to sell the sites in the new Mandi by auction would mean that the
existing licensees may have to compete with the non-licensees or newcomers for
the purchase of the sites within the Mandi. It is not possible to accept the
contention that adoption of a procedure to sell by auction is in any way bad in
law. If the contention of the appellants in accepted, the result would be that
the business of commission agents would continue to be in the hands of the old
and established licensed dealers and no new person would have any chance of
entering the said business.
Act and the Rules framed thereunder do not contain any provision which provides
for or makes it obligatory on the State to construct shops or to provide for
sites and to give preferences to the existing licensed dealers It is well
recognized that one of the fairest means, which a State can adopt without
showing any favour in disposing of the property is to sell it by auction
specially where the property in question is business premises. The sale of
plots by public auction is a judicious method for providing sites/plots and
givens an equal opportunity to all sections of public who may be interested in
carrying out trade for the purchase and sale of agricultural produce including
the appellants or other licensees who had already been carrying on such trade
or business in the old Mandies.
R.L. Batta, learned Senior Counsel appearing for some other dealers of Jagraon,
submitted that in the old Mandi, which was spread over an area of 25 acres,
there were 109 grain shops measuring 57" x 14". The total number of
licensees working therein were stated to be 250. In the new Mandi, there are
139 grain shops measuring 125" x 20". By providing for bigger shops,
it was submitted, the smaller traders have not been able to get shops in the
new Mandi in public auction. Referring to Circular dated 14.11.1994 issued by
the Director, colonization, Punjab, it was
submitted that more grain shops of smaller sizes can be constructed in the new Mandi.
aforesaid Circular dated 14.11.1994, it is stated that five grain shops in the
new Mandi in Jagraon remained to be auctioned. The Circular recognized the need
for more grain shops and provision being made for future expansion of the Mandi.
It was stated in the circular that an area measuring 6.33 acres "has been
earmarked for additional auction platforms in the north-west of the Mandi site
some smaller or bigger size grain shops can be carved out in this area. Divisionl Town planner, Mandi Board is being requested to send the
requirement of additional grain shops. Some grain shops of suitable size be
planned in the reserve area mentioned above in such a way that there is a
parking in the front of these shops and service lane on the sides keeping in
view the immediate requirement of plots in Mandi".
area of the grain shops of the new Mandi is much larger than that of the area
of the shops of old Mandi.
the new Mandi is spread over an area of 75.125 acres, the number of shops which
are earmarked for grain are only 139. The Advocate General, however submitted
that apart from 139 shops which are earmarked for grain, large number of booths
have been constructed which can also be used by the licensed dealers dealing in
grain. Apart from that considering the nature of the business of the licensed
dealers, it is possible for them to conduct their business in smaller shops.
Therefore, even if shops are to be allotted by auction the smaller size shops
would be within easy reach of the smaller traders. Keeping in view the
aforesaid Circular dated 14.11.1994, but without issuing any formal directions,
it is hoped that some more grain shops or booths of smaller sizes will be
constructed or earmarked in the aforesaid area measuring 6.33 acres and when
this is done, the smaller traders, who are still out of the new Mandi, would be
in a position to acquire business premises within the new Mandi. The scheme envisaged
in the circular dated 14.11.1994 should be considered, and if possible,
implemented at an early date.
the High Court, provision of Section 8 of the Act was challenged by contending
that the same infringes upon the freedom to carry on trade and business
enshrined in Article 19(1)(g) of the constitution because the power is given to
the State Government to notify a place as sub market yard under Section 7 and
to prohibit any person to set up or establish any other market within the
limits of such notified market or within a distance thereof to be notified in
the official gazette. The said Act has been enacted for the purpose of better
regulation of the purchase/sale/storage and processing of agricultural produce
and establishment of markets for agricultural produce in the State of Punjab . It is quite obvious that for the
proper regulation or monitoring of such sale, unauthorized markets within the
notified area should not be allowed to be established. It cannot be doubted
that Section 8 does give the power to place 8 restriction on the establishment
of unauthorized markets, but such a restriction is in public interest and bears
a reasonable nexus to the object which is sought to be achieved by the Act. The
new Mandies have been established with a view to remove the old Mandies from
the congested areas and with the object of providing better and more modern
facilities to the farmers and others connected with the purchase and sale of
agricultural produce. The new Mandies have been located at such places so as to
provide suitable and convenient location to all concerned after taking into
consideration the development of the town and city as a whole. In fact no
argument was addressed impugning the locations which have been selected for the
establishment of new Mandies. The High Court was. therefore, right in
concluding that neither the provisions of Sections 7 or 8 of the Act nor the
restrictions imposed by the impugned Notification violated the fundamental
rights contained in Article 19(1)(g) of the Constitution and that the
restrictions imposed were reasonable.
already mentioned the proposal to shift the Mandies to new sites has given rise
to a spate of Writ Petitions being filed before the Punjab & Haryana High
Court. This has resulted in inordinate delay in the establishment of the Mandies
and the closure of the old ones. Even though a new grain Mandi was declared to
be established in Jagraon in March, 1978, it is only recently according to the
Advocate General, that the old Mandi has been closed and business has started
in the new Mandi. The litigation has presumably resulted in the escalation of
the cost of constructing new shops, besides resulting in the old Mandies to
continue in the congested areas perhaps causing great deal of inconvenience to
the general public living in the vicinity.
all the plots in the new Mandies at Jagraon and Fazilka have been auctioned but
in Ludhiana the old Mandi has not yet been denotified and not a single auction
of plots has taken place. It is clear that this dealy in shifting to new sites
has occurred due to the actions of the existing licensed dealers of the old Mandies.
Different Writ Petitions have been filed in the High Court without disclosing
the pendency of earlier petitions and the orders passed thereon. The conduct of
some of the appellants of withholding this relevant fact from the court and
misleading it to pass interim orders, despite the fact that similar stay orders
passed earlier had been vacated has been adversely commented upon in Civil Writ
Petition No. 7211 of 1994 by G.J. Singhvi J. of the Punjab & Haryana High
Court in his judgement dated 4.9.1995. That Writ Petition was dismissed on the
ground of the said conduct of the appellants and heavy costs were imposed some
of the petitioners (appellants herein) in the said Writ Petition No.7211 of
1994 before the High Court are the appellants in Appeal arising out of Special
Leave Petition (C) No. 10997 of 1995. These are appellant Nos. 3,7,9,21,24,32,37,and
Nos.1,2,16,19,20,23,28, 126.96.36.199.39 & 45 in the Appeal arising out of
Special Leave Petition (C) No. 11139 of 1995 are persons who were also
petitioners in the said Writ Petition No. 7211 of 1994.
from the fact that these appellants were parties to the latter Writ petition
and had not disclosed the filing of the earlier writ petition in the High Court
these appellants in Appeal arising out of Special Leave Petition (C) No. 11139
of 1995 have also not disclosed the filing of Writ Petition No. 15883 of 1993
in the Punjab & Haryana High Court. That petition was filed by persons who
had purchased sites in the new Mandi at Jagraon and had wanted a direction for
the establishment of the said Mandi and the closure of the old one. 149 of the
appellants in Special Leave Petition (C) No. 11139 of 1995 moved an application
before the High Court and were impleaded as parties. The said Writ Petition No.
15831 of 1993 was allowed and the validity of the Notification issued under
Sections 7 & 8 of the Act was upheld. The filing of said civil Writ
Petition No. 15831 of 1993 and its being allowed by the punjab & Haryana
High Court by its Judgment dated 8.4.1994 has not been disclosed in Special
Leave Petition (C) No. 11139 of 1995 even though there were some common
petitioners. There is a merit in the contention of the Advocate General that
even in this Court, an attempt has been made on the part of the appellants not
to disclose full facts and to secure a favorable order. Such a practice cannot
be encouraged and has to be deprecated.
while dismissing these appeals, we impose a cost of Rs 5,000/- on each of the
appellant Nos.3,7,188.8.131.52.37 and 41 in the Appeal arising out of S.L.P (c)
No. 10997 of 1995 and appellant Nos.1,2,16,19,20,22,23,28,34,35,36,37,39 and 45
in the Appeal arising out of S.L.P. (C) No. 11139 of 1995.
cost to be paid to the State of Punjab.