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Issues Involved:
1. Applicability of the Act and Rules to pressed cotton. 2. Validity of Rule 65 under the rule-making power of the State Government. 3. Nature of the transactions as forward contracts and their implications. Issue-wise Detailed Analysis: 1. Applicability of the Act and Rules to Pressed Cotton: The primary issue was whether the Bombay Agricultural Produce Markets Act and the Rules framed thereunder applied to pressed cotton. The appellant contended that pressed cotton does not fall within the definition of "cotton, ginned or unginned" as specified in the Schedule of the Act. The Court examined the relevant provisions, including Section 2(1)(i) of the Act which defines "Agricultural Produce" to include all produce specified in the Schedule, and Rule 65(1) which prohibits trading in agricultural produce without a licence. The Court held that pressed cotton is merely ginned cotton that has been pressed into bales for transportation convenience and does not undergo any chemical or industrial process that would alter its fundamental nature. Therefore, pressed cotton remains "cotton, ginned or unginned" as specified in the Schedule, and the appellant, having conducted business in pressed cotton within the market area without a licence, contravened Rule 65. 2. Validity of Rule 65 under the Rule-making Power of the State Government: The appellant argued that Rule 65 was ultra vires, claiming it exceeded the rule-making power granted to the State Government under Section 26 of the Act. Specifically, the appellant contended that Section 26(2)(e) only authorized the State Government to set maximum fees for licences, not to mandate licences for trading. The Court analyzed the provisions of Section 26(1) and Section 27 of the Act. Section 26(1) empowers the State Government to make rules for carrying out the provisions of the Act, and Section 27 allows the Market Committee to make bye-laws for regulating business and trading conditions within the market area, subject to the rules made by the State Government. The Court concluded that Rule 65, which requires traders to obtain a licence, was made to facilitate the effective functioning of the Market Committee under Section 27. Thus, the rule was within the scope of the State Government's rule-making power under Section 26(1). 3. Nature of the Transactions as Forward Contracts: The appellant's third contention was that the transactions were forward contracts for future delivery, and since no delivery was intended or made, they did not constitute trading in cotton within the market area. The Court did not pursue this contention in detail, noting that the term "business" in Rule 65(1) is broad enough to encompass forward contracts. Consequently, the appellant's argument on this point was dismissed. Conclusion: The appeal was dismissed. The Court upheld the High Court's judgment, confirming that pressed cotton falls within the scope of "cotton, ginned or unginned" as specified in the Schedule of the Act. The Court also validated Rule 65 as being within the State Government's rule-making power and dismissed the appellant's argument regarding forward contracts. The appellant was therefore correctly convicted for contravening Rule 65(1) and fined Rs. 25.
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