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Issues Involved:
1. Constitutional validity of the increase in the rate of market fee. 2. Constitutional validity of sub-s. (6) of s. 7 of the Act. 3. Power of market committees to levy market fee outside their markets but within their respective notified market areas. 4. Levy of market fee on subsequent transactions of rice after paddy has already suffered market fee. Summary: Issue 1: Constitutional Validity of the Increase in Market Fee The Supreme Court examined the challenge to the increase in the rate of market fee from 50 paisa to rupee one u/s 12(1) of the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966. The petitioners argued that there was no quid pro quo between the increase in the rate of market fee and the services rendered. The Court held that it is not always possible to work out with mathematical precision the amount of fee required for services rendered each year. An overall picture must be taken to determine if there is a correlation between the fee and the services rendered. The Court found that the income from the market fee, even after its increase, was not sufficient to meet the expenditure of the market committees. Therefore, the increase in the rate of market fee was justified. Issue 2: Constitutional Validity of Sub-s. (6) of s. 7 of the Act The petitioners contended that sub-s. (6) of s. 7 of the Act, which prohibits the purchase or sale of any notified agricultural produce, livestock, and products of livestock in a notified market area, outside the market in that area, was repugnant to Art. 19(1)(g) of the Constitution. The Court held that the restriction imposed by sub-s. (6) of s. 7 was a reasonable restriction within the meaning of cl. (6) of Art. 19 on the fundamental right of a citizen to carry on trade or business. The restriction was necessary to prevent the business in such agricultural produce from being diverted to other places and to ensure that the producers get the best competitive prices in an open market. Issue 3: Power of Market Committees to Levy Market Fee Outside Their Markets The petitioners argued that there was no liability to pay market fee on transactions of sale and purchase of notified agricultural produce, livestock, and products of livestock taking place from their business premises in the notified market area but outside the market. The Court held that the establishment of a regulated market itself is a service rendered to persons engaged in the business of purchase or sale of such commodities. The services and facilities provided by the market committees extend throughout the notified market area and are not confined to the market proper. Issue 4: Levy of Market Fee on Subsequent Transactions of Rice The petitioners contended that if paddy has already suffered market fee, subsequent transactions of rice should not be subjected to payment of market fee again. The Court examined Rule 74(1) of the Andhra Pradesh (Agricultural Produce and Livestock) Markets Rules, 1969, which provides that market fees shall not be collected by another market committee when such notified agricultural produce, livestock, or products of livestock are brought into the notified market area of another market committee for processing, pressing, packing, storage, export, and on sales effected in the course of commercial transactions between licensed traders and consumers. The Court concluded that the exemption from payment of market fee is claimable if such transactions take place within the notified market area of the same market committee, subject to the production of evidence about the payment of market fees from where it was brought. Conclusion: The Supreme Court dismissed all the writ petitions and appeals, upholding the constitutional validity of the increase in the rate of market fee, sub-s. (6) of s. 7 of the Act, and the levy of market fee on transactions outside the market but within the notified market area. The Court also clarified the conditions under which market fee on subsequent transactions of rice is exempted.
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