KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. MIS. SHIV SHAKTI KHANSARI UDYOG AND OTHERS

The Madhya Pradesh Agricultural Produce Markets Act, 1960 has been in force in the State since October, 1960. During the operation of the Act for the last twelve years, the number of agricultural market committees has risen from 87 to 230. The working of the Act has revealed certain shortcomings and it was considered desirable by the State Government to review the Act in order to ensure efficient working of the market committees to the best advantage of the agriculturists as well as traders. A committee was constituted by the State Government for the purpose and the committee recommended revision of the Act of 1960. Hence the State Government have got passed the present Bill. H

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A 2. The salient feature of the Bill are as follows:

(i) Establishment of markets for the specified areas and of regulation of marketing of notified agricultural produce therein. B (ii) Establishment of market committee for every market area and constitution of State Marketing Service to secure efficient administration of market committees.

c (iii) Constitution of the Madhya Pradesh State Agricultural Marketing Board at the State level to coordinate the work of market committees in the State and to advise the State Government.

(iv) Election of Chairman of market committee from D amongst the representatives of agriculturists.

(v) Provision for deterrent punishment for resorting to trade malpractices by market functionaries in the market area. E

3. Having regard to the provisions of article 31(3), 254(2) and 304 of the Constitution of India, the Governor of Madhya Pradesh has reserved the Bill for the consideration and assent of the President.

F 4. The Department of Agriculture, Department of Food, Planning Commission and the Department of Internal Trade who were consulted have no objection to the assent of the President being given to the Bill. The Department of Agriculture have, however, suggested that the details of the G composition of the State Marketing Board, which have not been given in the Bill, should be specified in the Bill. This suggestion will be communicated to the State Government. The Ministry of Law who were consulted do not see any objection to the assent of the President being given to the H Bill from the legal and constitutional point of view.

KRISHI UPAJ MANDI SAMIT!, NARSINGHPUR v. SHIV 471 SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.] Accordingly, if the Minister approves, the Bill may be A recommended to the President for his assent. (Sd/-) (P.P. Nayyar) Joint Secretary.• B

24Copy pinpoint24. From the summary reproduced hereinabove, it is clear that the State Government had not reserved the Market Act for Presidential assent on the ground of any repugnancy between the provisions of that Act and the Control Order. As a matter of fact, the State Government could not have even thought of C any repugnancy between these statutes because at the relevant time, sugarcane was not treated as an agricultural produce and was not included in the Schedule appended to the Market Act.

25Copy pinpoint25. The nature and scope of Presidential assent under Article 254(2) of the Constitution was considered by the D Constitution Bench in Gram Panchayat of Village Jamalpur v. Ma/winder Singh (supra). In that case, it was argued that the President's assent to Section 3(a) of the Punjab Village Common Lands (Regulation) Act, 1953 would give it precedence over the Administration of Evacuee Property Act, E 1950, which was enacted by Parliament. The Constitution Bench held that the assent of the President under Article 254(2) of the Constitution is not an empty formality and the President has to be apprised of the reason why his assent was being sought. The Constitution Bench further held that if the assent is sought for a specific purpose, the efficacy of assent would be limited to that purpose and cannot be extended beyond it. The relevant observations made on this issue are contained in Para 12, which is extracted below: "12. The Punjab Act of 1953 was reserved for consideration of the President and received his assent on December 26, 1953. Prima facie, by reason of the assent of the President, the Punjab Act would prevail in the State of Punjab over the Act of the Parliament and the Panchayats would be at liberty to deal with the Shamlat- H

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A deh lands according to the relevant Rules or bye-laws governing the matter, including the evacuee interest therein. But, there is a complication of some nicety arising out of the fact that the Punjab Act was reserved for the assent of the President, though for the specific and limited purpose 8 of Articles 31 and 31-A of the Constitution. Article 31, which was deleted by the Constitution (Forty-fourth Amendment) Act, 1978 provided for compulsory acquisition of property. Clause (3) of that article provided that, no law referred to in clause (2), made by the c Legislature of a State shall have effect unless such law, having been reserved for the consideration of the President, has received his assent. Article 31-A confers protection upon laws falling within clauses (a) to (e) of that article, provided that such laws, if made by a State Legislature, have received the assent of the President. D Clause (a) of Article 31-A comprehends laws of agrarian reform. Since the Punjab Act of 1953 extinguished all private interests in Shamlat-deh lands and vested those lands in the Village Panchayats and since, the Act was a measure of agrarian reform, it was reserved for the E consideration of the President. The judgment of the High Court shows that the hearing of the writ petitions was adjourned to enable the State Government to place material before the Court showing the purpose for which the Punjab Act of 1953 was forwarded to the President F for his assent. The record shows, and it was not disputed either before us or in the High Court, that the Act was not reserved for the assent of the President on the ground that it was repugnant to an earlier Act passed by the Parliament, namely, the Central Act of 1950. In these G circumstances, we agree with the High Court that the Punjab Act of 1953 cannot be said to have been reserved for the assent of the President within the meaning of clause (2) of Article 254 of the Constitution insofar as its repugnancy with the Central Act of 1950 is concerned. H The assent of the President under Article 254(2) of the

KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 473 SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.]

Constitution is not a matter of idle formality. The A President has, at least, to be apprised of the reason why his assent is sought if, there is any special reason for doing so. If the assent is sought and given in general terms so as to be effective for all purposes, different considerations may legitimately arise. But if, as in the B instant case, the assent of the President is sought to the Law for a specific purpose, the efficacy of the assent would be limited ito that purpose and cannot be extended beyond it. Not only was the President not apprised in the instant case that his assent was sought because of the c repugnancy between the State Act and the pre-existing Central Act on the vesting of evacuee properties but, his assent was sought for a different, specific purpose altogether. Therefore, that assent cannot avail the State Government for the purpose of according precedence to 0 the law made by the State Legislature, namely, the Punjab Act of 1953, over the law made by the Parliament, even within the jurisdiction of the State."

(emphasis supplied) E

26Copy pinpoint26. The proposition laid down in Gram Panchayat of Village Jamalpur v. Ma/winder Singh (supra) was considered by another Constitution Bench in Kaiser-I-Hind Pvt. Ltd. v. National Textile Corporation (Maharashtra North) Ltd. (supra). Speaking for the majority of the Court, Shah, J. observed: F

"In view of the aforesaid requirements, before obtaining the assent of the President, the State Government has to point out that the law made by the State Legislature is in respect of one of the matters enumerated in the Concurrent List by mentioning entry/entries of the Concurrent List and that G it contains provision or provisions repugnant to the law made by Parliament or existing law. Further, the words "reserved for consideration" would definitely indicate that there should be active application of mind by the President to the repugnancy pointed out between the proposed H

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A State law and the earlier law made by Parliament and the necessity of having such a law, in the facts and circumstances of the matter, which is repugnant to a law enacted by Parliament prevailing in a State. The word "consideration" would manifest that after careful thinking B over and due application of mind regarding the necessity of having State law which is repugnant to the law made by Parliament, the President may grant assent. This aspect is further reaffirmed by use of the word "assent" in clause (2), which implies knowledge of the President to the c repugnancy between the State law and the earlier law made by Parliament on the same subject-matter and the reasons for grant of such assent. The word "assent" would mean in the context as an expressed agreement of mind to what is proposed by the State." D (emphasis supplied)

Shah, J. then referred to various meanings of the word "assenr and observed:

"Applying the aforesaid meaning of the word "assent" and from the phraseology used in clause (2), the object of Article 254(2) appears that even though the law made by Parliament would have supremacy, after considering the situation prevailing in the State and after considering the repugnancy between the State legislation and the earlier law made by Parliament, the President may give his assent to the law made by the State Legislature. This would require application of mind to both the laws and the repugnancy as well as the peculiar requirement of the State to have such a law, which is repugnant to the law made by Parliament. The word "assent" is used purposefully indicating affirmative action of the proposal made by the State for having law repugnant to the earlier law made by Parliament. It would amount to accepting or conceding and concurring to the demand made by the State for such law. H This cannot be done without consideration of the relevant

KRISHI UPAJ MANDI SAMIT!, NARSINGHPUR v. SHIV 475 SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.] material. Hence, the phrase used is "reserved for A consideration", which under the Constitution cannot be an idle formality but would require serious consideration on the material placed before the President. The "consideration" could only be to the proposal made by the State. B

It is true that the President's assent as notified in the Act nowhere mentions that assent was obtained qua repugnancy between the State legislation and specified certain law or laws of Parliament. But from this, it also cannot be inferred that as the President has given assent, all earlier law/laws on the subject would not prevail in the State. As discussed above before grant of the assent, consideration of the reasons for having such law is necessary and the consideration would mean consideration of the proposal made by the State for the law enacted despite it being repugnant to the earlier law made by Parliament on the same subject. If the proposal made by the State is limited qua the repugnancy of the State law and law or laws specified in the said proposal, then it cannot be said that the assent was granted qua the repugnancy between the State law and other laws for which no assent was sought for. Take for illustration - that a particular provision, namely, Section 3 of the State law is repugnant to enactment A made by Parliament; other provision, namely, Section 4 is repugnant to some F provisions of enactment made by Parliament and Sections 5 and 6 are repugnant to some provisions of enactment and the State submits proposal seeking "assenr mentioning repugnancy between the State law and provisions of enactments and without mentioning G anything with regard to enactment C. In this set of circumstances, if the assent of the President is obtained, the State law with regard to enactments and would prevail but with regard to C, there is no proposal and hence there is no "consideration" or "assent". Proposal by the H

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A State pointing out repugnancy between the State law and of the law enacted by Parliament is a sine qua non for "consideration" and "assent". If there is no proposal, no question of "consideration" or "assent" arises. For finding out whether "assent" given by the President is restricted B or unrestricted, the letter written or the proposal made by the State Government for obtaining "assent" is required to be looked into."

27Copy pinpoint27. In his concurring judgment, Doraiswamy Raju, J. made the following observations: c "The assent of the President envisaged under Article 254(2) is neither an idle or empty formality, nor an automatic event, necessitated or to be given for the mere asking, in whatever form or manner and whether specific, vague, general or indefinite - in the terms sought for to claim that once sought and obtained as well as published, a curtain or veil is drawn, to preclude any probe or contention for consideration that what was sought and obtained was not really what should and ought to have been, to claim the protection envisaged under clause (2) in respect of a particular State law vis- a-vis or with reference to any particular or specified law on the same subject made by Parliament or an existing law, in force. The repugnancy envisaged under clause (1) or enabled under clause (2) to get excepted from under the protective coverage of the assent obtained from the President, is such that there is a legislation or legislative provision(s), covering and operating on the same field or identical subject-matter made by both the Union and the State, both of them being competent to enact in respect of the same subject-matter or legislative field, but the legislation by Parliament has come to occupy the entire field. Necessarily, in the quasi-federal structure adopted for the nation, predominance is given to the law made by Parliament and in such circumstances only the State law H

KRISHI UPAJ MANDI SAMITI, NARSINGHPUR v. SHIV 477 SHAKTI KHANSARI UDYOG [G.S. SINGHVI, J.] which secured the assent of the President under clause A (2) of Arlicle 254 comes to be protected, subject of course to the powers of Parliament under the proviso to the said clause. Therefore, the President has to be apprised of the reasons at least as to why his assent is being sought, the need or necessity and the justification or otherwise B for claiming predominance for the State law concerned. This itself would postulate an obligation, inherent in the scheme underlying as well as the very purpose and object of seeking the assent under clause (2) of Arlicle 254, to enumerate or specify and illustrate the parlicu/ar c Central Jaw or provision with reference to which the predominance is desired. The absence of any standardized or stipulated form in which it is to be sought for, should not detract the State concerned, to disown its obligation to be precise and specific in the extent of 0 protection sought having regard to the serious consequences which thereby inevitably follow i.e. the substitution of the Union law in force by the State law, in the territorial limits of the State concerned, with drastic alteration or change in the rights of citizen, which it may, thereby bring about.

The mere forwarding of a copy of the Bill may obviate, if at all, only the need to refer to each one of the provisions therein in detail in the requisition sent or the letter forwarding it, but not obliterate the necessity to point out specifically the particular Central law or provisions with reference to which, the predominance is claimed or purported to be claimed. The deliberate use of the word "consideration" in clause (2) of Article 254, in my view, not only connotes that there should be an active application of mind, but also postulates a deliberate and careful thought process before taking a decision to accord or not to accord the assent sought for. If the object of referring the State law for consideration is to have the repugnancy resolved by securing predominance to the State law, the H

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A President has to necessarily consider the nature and extent of repugnancy, the feasibility, practicalities and desirabilities involved therein, though may not be obliged to write a judgment in the same manner, the courts of law do, before arriving at a conclusion to grant or refuse to B grant or even grant partially, if the repugnancy is with reference to more than one law in force made by Parliament. Protection cannot be claimed for the State law, when questioned before courts, taking cover under the assent, merely asserting that it was in general form, c irrespective of the actual fact whether the State claimed for such protection against a specific law or the attention of the President was invited to at least an apprehended repugnancy vis-a-vis the particular Central law. In the teeth of innumerable Central laws enacted and in force on concurrent subjects enumerated in List Ill of the Seventh D Schedule to the Constitution, and the hoard of provisions contained therein, artificial assumptions based on some supposed knowledge of all those provisions and the presumed regularity of official acts, cannot be blown out of proportion, to do away with an essential exercise, to make the "assent" meaningful, as if they are empty formalities, except at the risk of rendering Article 254 itself a dead letter or merely otiose. The significant and serious alteration in or modification of the rights of parties, both individuals or institutions resulting from the "assent" cannot be overlooked or lightly brushed aside as of no significance, whatsoever. In a federal structure, peculiar to the one adopted by our Constitution it would become necessary for the President to be apprised of the reason as to why and for what special reason or object and purpose, predominance for the State law over the Central law is sought, deviating from the law in force made by Parliament for the entire country, including that part of the State."

H (emphasis supplied)

KRISHI UPAJ MANDI SAMIT!, NARSINGHPUR v. SHIV 479 SHAKTI KHANSARI UDYOG [G.S. SINGHVi, J.]

28Copy pinpoint28. In view of the aforesaid judgments of the Constitution A Benches, we hold that Article 254(2) of the Constitution is not available to the appellants for seeking a declaration that the Market Act would prevail over the Control Order and that transactions involving the purchase of sugarcane by the factories operating in the market areas would be governed by B the provisions contained in the Market Act. As a corollary, we hold that the High Court did not commit pny error by quashing the notices issued by appellant - Market Committees to the respondents requiring them to take licence under the Market Act and pay market fee on the purchase of sugarcane from c Cane Growers/Cane Growers Cooperative Societies.

29Copy pinpoint29. In the result, the appeals are dismissed. The parties are left to bear their own costs. B.B.B. Appeals dismissed. D