Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 4
PETITIONER:
EDWARD KEVENTER PVT. LTD.
Vs.
RESPONDENT:
BIHAR STATE AGRICULTURAL MARKETING BOARD AND OTHERS
DATE OF JUDGMENT: 11/04/2000
BENCH:
V.N.Khare, Doraiswami Raju
JUDGMENT:
V.N.KHARE, J.
The appellant herein is a company registered under the
Indian Companies’ Act and has its head office and factory’
outside the State of Bihar. The company manufactures fruit
drinks and markets it under the brand name of ’Frooti" and
’Appy’ in the State of Bihar through its agents. The Bihar
Legislature has enacted an Act known as ’Bihar Agricultural
Produce Market Act, I960’ (hereinafter referred to as the
Act). The object
of the Act is to provide better regulation of buying
and selling of agricultural produce and the arrangement of
market for agricultural produce in the State of Bihar.
Under Section 27 of the Act. the Market Committee set up
under the Act has power to levy and collect market fee on
the agricultural produce, which are specified in the
Schedule and are bought or sold in the market area. It is
not disputed that the entire district of Patna is declared
as a market area. Section 2(l)(a) of the Act defines
agricultural produce which runs as under:
" ’Agricultural produce’ means all produce whether
processed or non-processed, manufactured or not, of
Agriculture, Horticulture, Plantation, animal Husbandry,
Forest, Sericulture, Pisciculture, and includes livestock or
poultry as specified in the Schedule ".
Under Section 39 of the Act, the State Government by a
notification is empowered to add, amend, or cancel any of
the items of the agricultural produce in the Schedule as
required by Section 2(l)(a) of the Act. In the Schedule, as
contemplated under Section 2(l)(a), mango and apple are
specified under the caption ’fruits’ as items No. I and 13
respectively. The respondents treating ’Frooti’ and ’Appy’
as mango and apple products. issued a notice dated 28.3.89,
requiring the appellant to pay market fee or
the products marketed under the brand name Frootii’
and ’Appy’, failing which action under the Act would be
taken. Under such circumstances, the appellant challenged
the aforesaid demand by means of a writ petition under
Article 226 of the Constitution. However, the said writ
petition was dismissed and Letters Patent Appeal filed
against the judgment of the learned Single Judge was also
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 4
dismissed. It is in this way the appellant is in appeal
before us.
The short question that arises for consideration in
this case is, whether the products which are ready to serve
beverages under the brand name ’Frooti’ and ’Appy’ fall
under the description of mango and apple, specified in the
Schedule. The contention of the learned counsel for the
appellant is that, both the fruit drinks are not covered by
the Schedule, whereas the contention of the respondents’
counsel is that the products being the mango and apple
juices are covered under the item "mango’ and ’apple’, as
specified in the Schedule.
The appellant has described the manufacturing process
of beverages ’FrotF and ’Appy’ as under:
"Frooti and Appy are fruit drinks and manufacturing
process of both are cumbersome It is alleged that one of 3
the ingredistlis of Frooti is mango pulp and not mango
which is procured by the appellant compam as nw material
from outside agencies. Similarly, one of the ingredients of
Appy is apple concentrate and not apple. The pulp is first,
passed through a filter and stored in beverage tank.
Similarly sugar in proportionate quantih’ is processed in
the form of.syrup after heating it to a certain temperature
and then cooling it. Demineralised water is then added to
the sugar syrup to the extent that it attains a certain
’brix’ content. Meanwhile in the beverage tank requisite
amount of Citric acid. non alcoholic beverage base(NABB),
other permitted additives, sodium citrate, vitamin C are
added. Thereafter the sugar syrup and the mixture in the
beverage tank are mixed in proportionate quantity.
Thereafter the said mixture is passed through homogeniser
and crushed at a very high pressure to disintegrate all the
fibres, which are present in the beverage mixture. After
homogenisatton, the mixture is then required to be pa^ised
through pasteuriser where it is heated to a temperature
between 95 to 100 degrees centigrade for killing all the
bacteria and micro organism, if there be any. Subsequently,
the said mixture is passed through a cooling channel for
cooling do\vn to the room temperature and passed through
pipe lines into the steriliser of the tetra brik aseptic
packaging machine for packing the beverage in tetra brik
packs of 200ml size which requires high technical
expertise. The paper -which is used for the packaging,
consists of se\’en layers of materials which include
aluminum foil, laminated polythene etc. for taking care of
aseptic^’ e’^uring high safety and required life for the
produce. The 200 ml pack is then packed in the packaging
machine and which passes through the com’eyor system on way
to the tray packing machine, where it is accumulated in
trays. The said tray containing the fruit drink pack is
then shrink wrapped by means of the shrink wrapper machine.
After everything is completed, the fruit drink packs are
kept under incubation for a period ofse\>en days for
detection of gro\vth of any microorganism through a
microbiological analysis. Simultaneously, organoliptic test
is also conducted for testing the colour and taste of the
beverage. After all that the ’Frooti ’ and ’Appy ’ are
ready for being delivered in the market.
A perusal of Section 2(i)(a) unambiguously shows that
the agricultural produce which are to be covered by the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 4
sweep of the Act necessarily has to be specified in the
Schedule. If any agricultural produce is not specified in
the Schedule, it goes beyond the purview of the Act and
respondent has no power to levy fee on such produce. In the
Schedule under caption ’fruits" mango and apple have been
specified as agricultural produce. We further find in the
Schedule that under caption ’cereals’ wheat is specified at
item No. 3, whereas ’wheat atta’ ’sujji" and ’maida’ which
are the products of wheat are separately specified at item
Nos. 14, 15 and 16, respectively. This shows that the
agricultural produce ’wheat’ has been treated as a separate
agricultural produce as compared to its own product
manufactured out of ’wheat’ namely, ’atta’, ’sujji and
’maida’. ’Atta ’sujji’ and ’maida’ are basically the
agricultural products of ’wheat’. Similarly, the Schedule
shows that under the caption ’Animal Husbandry Product’,
milk excluding liquid milk is specified at item No. 19
whereas ’butter’, ’ghee\ ’cream’, ’chena’ and ’khoya’ which
are manufactured out of milk are separately specified at
item Nos. 7,8,16,17 and 19 respectively. Under caption
’miscellaneous’, ’mango pickles’ is specified at item No.
IS.
’Mango pickles’ is a product of mango, which is a
fruit; and specified in Schedule but ’mango pickles’ have
been specified separately. This shows basic ingredients may
be the same but the end product which is known differently
is treated as a separate item. It is true that Trooti’ and
"Appy" are manufactured out of mango pulp and apple
concentrate, but after the mango pulps and apple concentrate
are processed and beverages are manufactured, the products
become entirely different items and the fruits mango and
apple loose their identity. In common parlance, these
beverages are no longer known as mango and apple as fruits.
In other words, after processing mango pulp and apple
concentrate, although the basic character of the mango pulp
and apple concentrate may be present in beverages, but the
end products are not fruits i.e. mango and apple which are
specified in the Schedule. Our views also find support from
a Constitution Bench decision of this Court in the case of
Belsund Sugar Co. Ltd. Vs. State of Bihar & Ors. [1999
(9) SCC, 620] wherein it was held that Lactodex and Raptakos
which are baby foods do fall under the description milk,
specified in the Schedule of the Act. Under such
circumstances, we find that the products like ’Frooti’ and
’Appy’ which are ready to serve beverages not
being specified in the Schedule are not covered by the
term agricuitural produce, as defined in Section 2(1 )(a) of
the Act.
Learned Additional Solicitor General then cited a
decision of this Court in the case of Krishi Utpadan Mandi
Samifri and another vs. M/s. Shankar Industries xid others
[1993 Supp. (3) SCC 361(11)] for the proposition that the
meaning of ’agriculture produce’ in the definition is not
restricted to any products of agriculture specified in the
Schedule, but also include such items which come into being
in the processed form, and has strongly relied para 12 of
the said decision, which reads as under:
" We have considered the arguments advanced on behalf
of’ the parties and have perused the record. A perwal of
the definition of agriculture produce under Section 2 (a) of
the Act show’s that apart from items of produce of
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 4
agriculture, horticulture, viticulture, piculture,
sericulture. pisciculture, animal husbandry or forest as
are specified in the Schedule, the definition further
’includes admixture of’ two or more such items’ and
thereafter it further ’includes taking any such item in
processed form ’ and again for the third time the words used
are ’and further includes gur, rab, shakkar, khandsari and
jaggery ’ It is a well settled rule of interpretation that
where the legislature uses the words ’means’ and ’includes’
such definition is to be given a wider meaning and is not
exhaustive or restricted to the items contained or included
in such definition. Thus the meaning of ’agricultural
produce’ in the abwe definition is not restricted to any
products of agriculture as specified in the Schedule hut
also includes such items which come into being in
processed forn: and further includes such items which are
called as gur. rab. shakhar, khandsarl and jaggery’. "
We are of the view that the said decision is wholly
inapplicable to the present controversy. In the Uttar
Pradesh Act, the agricultural produce is defined as under:
" Section 2(a) ’agricultural produce ’ means such
items of produce of agriculture, horticulture, viticulture,
apiculture, sericulture, pisciculture, animal husbandry or
forest as are specified in the Schedule, and includes
admixture of two or more of such items, and also includes
any such item in processed form, and further includes gur,
rah, shakkar. khandsari and jaggery’. "
The controversy in the case of Krishi Utpadan Samiti
(supra), was whether gur-lauta and raskat and rabgolawat and
salawat, which are products of molasses, are agricultural
produce. This Court while interpreting words "means’ and
’includes’ used in the definition, was of the view that
these words have to be given wider meaning and processed
item of a good specified in Schedule would be agricultural
produce. In U.P. Act, the definition of ’agricultural
produce’ provided that any processed item of a specified
good is an agricultural produce. Such is not the definition
of 8
’agricultural produce’ in the Bihar Act with which we
are concerned in the present case.
For the reasons aforestated. we are of the view that
the product ’Frooti" and ’Appy’ not being specified in the
Schedule, the respondent had no authroty to demand any fee
from the appellant on marketing the said products.
Consequently, the order and judgment of the High Court is
set aside and the appeal is allowed. There shall be no
order as to costs.