MIS. KUMAON SEEDS COPRN. & ORS. v. KRISHI UTPADAN MANDI SAMITI, KASHIPUR & ORS.

Case Details & Bench

Court: High Court
Hon'ble Judges: Markandey Katju
Gyan Sudha Misra
Judgment Date: 2011-03-03
Court Decision / Holding: Appeals disposed of. The Court set aside the date 27.07.2005 show cause notices, directed fresh notices with fixed hearing dates, and instructed that only after hearing the appellants and considering any material produced, the Market Committees may decide the matter by a reasoned order. No findings on merits were made; the decision is reserved pending proper hearing.
Final Disposition: Appeals disposed of; no costs.

Parties to the Case

Appellants / Petitioners

MIS. KUMAON SEEDS COPRN. & ORS.

Respondents

KRISHI UTPADAN MANDI SAMITI, KASHIPUR & ORS.

Legal Representation & Advocates

Counsels for Petitioners

• P.S. Patwalia
• Vibha Datta Makhija

Counsels for Respondents

• Sudhir Chandra
• Rachana Shivastava

Case Synopsis & Summary

The appellants, MIS. Kumaon Seeds Co. Pvt. Ltd. and others, deal in certified seeds and were subjected to show cause notices issued by the Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964, seeking imposition of market fee on certified seeds. The appellants filed civil suits challenging these show cause notices, which were dismissed by the High Court (Uttaranchal/Uttarakhand) on merits, despite the suit’s focus being the validity of the notices. The Supreme Court clarified that the High Court's consideration should have been restricted to the validity of the notices, not merits, and noted that the High Court’s observations on merits were unwarranted. The Court found a serious violation of natural justice: after upholding the notices, the Market Committees failed to fix a date, time, and place for hearing the appellants; instead, they issued fresh notices directing payment of market fee without allowing a hearing. Consequently, the Court set aside the notices dated 27.07.2005, and directed the Market Committees to issue fresh notices fixing a hearing date and place, allowing the appellants to respond and present any material, and only thereafter deciding the matter by a reasoned order. The Court explicitly stated it did not comment on the merits and left the matter open for decision post hearing. The Appeals are disposed of with no costs.

Provisions of Law Cited

Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964

Legal Doctrines & Maxims

Principles of natural justice
Audi alteram partem (implicit in natural justice)
Reasoned order after hearing

Submissions & Arguments

Contentions of Appellants / Petitioners

The appellants contended that the show cause notices were issued without giving a fair opportunity of hearing and that the subsequent hearing process was not properly conducted, violating natural justice. They urged that notices should have been issued with a fixed hearing schedule after a prima facie validity of the notices was established, enabling a reasoned, evidence-based decision.

Contentions of Respondents

The respondents argued that the notices were valid and that no substantive violation of law occurred; the market fee could be imposed under the Act, and the hearing process, as conducted, would ordinarily be sufficient to reach a decision, with the High Court's observations on merits not binding on the question of validity.

Extracted Judgment Text

Exact text extracted from official judgment records.

A ## [2011] 3 S.C.R. 718 ## MIS. KUMAON SEEDS COPRN. & ORS. _v._ KRISHI UTPADAN MANDI SAMITI, KASHIPUR & ORS. (Civil Appeal No(s). 3630 of 2007) ## B MARCH 03, 2011 ## [MARKANDEY KAT JU AND GYAN SUDHA MISRA, JJ.] _I_ - _Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964_ - - - _Certified seeds Market fee Levy of Issuance of show_ C _cause notices by market Committee to dealer in certified_ - _seeds with regard to imposition of market fee on seeds Suits_ - _filed challenging the show cause notices Dismissed by High_ - _Court On appeal, held: High Court while dealing only with the validity of the show cause notices made certain_ D _observations even. on merits of the matter, which was not_ - _justified After the High Court upheld the validity of the show cause notices, the Market Committee did not fix any date, time and place for the hearing of the dealers in response to the show cause notices but straightaway proceeded to issue_ E _notices directing the dealers to pay the market fee on certified_ - _seeds which was not justified There was violation of the_ - - _principles of natural justice Thus, such notices set aside Market Committees permitted to issue fresh notices to the dealers fixing the date, time and place for the hearing to the_ F _show cause notices and on that date they can file their response and any other material which they wish to produce and only thereafter, the Market Committees can decide the matter by_ a _reasoned order_ - _Principles of natural justice._ CIVIL APPELLATE JURISDICTION : Civil Appeal No. G 3630 of 2007 etc. From the Judgment & Order dated 07.07.2005 of the High Court of Judicature of Utaranchal, at Nainital, in First Appeal No. 1073 of 2001. 718 H 719 KUMAON SEEDS COPRN. & ORS. _v._ KRISHI UTPADAN MANDI SAMIT!, KASHIPUR & ORS. ## WITH A Civil Appeal No. 3631 of 2007. ; P.S. Patwalia, Vibha Datta Makhija for the Appellants. Sudhir Chandra, Rachana S~ivastava for the Respondents. B . •· The following order of the Court was delivered ## **ORDER** Heard learned counsel :for the appearing parties. C These Appeals have been filed against the impugned common judgment of the High Court of Uttarachal (Now, the . High Court of Uttarakhand) dated 07.07.2005 passed in First Appeal No. 1072 of 2001 and First Appeal No. 1073 of 2001. D The· appellants claim to be dealing in certified seeds. Seeking to impose market fee on those seeds under the Uttar Pradesh Krishi Utpadan Mandi Adhiniyam, 1964, the respondents issued show cause notices to the appellants. The appellants filed civil suits challenging the said show cause E notices and the matter went upto the High Court which dismissed the suits by the impugned judgment. In our opinion, the High Court should not have gone into the merits of the matter because it was only dealing with the validity _o1_ the show cause notices in question and not deciding the matter on merits. However, it appears that certain observations have been made even on the merits of the case by the High Court in the impugned judgment, which, in our opinion, was not justified. F G After the High Court upheld the validity of the show eause notices, the concerned Market Committees should then have issued notices to the appellants fixing a date, time and place for the hearing of the appellants in response to that show cause notices, and in that hearing, the appellants should have been H 720 SUPREME COURT REPORTS (2011) 3 S.C.R. A allowed to appear either in-person or through their representatives and permitted to file their objections and any other material which they wished to produce and only thereafter should the matter have been decided, one way or the other, by the Market Committees concerned, by a reasoned order after B considering the response of the appellants as well as the other material. c It appears that the above procedure was not followed and, hence, in our opinion, there was violation of the principles of natural justice. After the impugned judgment of the High Court, the concerned Market Committees never fixed any date, time and place for the hearing of the appellants in response to the show cause notices but straightaway it proceeded to issue notices D dated 27.07.2005 directing the appellants to pay the market fee on certified seeds which, in our opinion, was not justified. Hence, we set aside the notices dated 27.07.2005 but we permit the Market Committees concerned to issue fresh notices to the appellants fixing therein the date, time and place for the E hearing of the appellants to the show cause notices, and on that date the appellants can file their response and also produce any other material which they wish to produce and only thereafter the Market Committees concerned can proceed to decide the matter by a reasoned order uninfluenced by any F observations made by the High Court in the impugned judgment. We make it clear that we are not making any comment on the merits of the controversy. We leave it open to the concerned authorities to decide the matter after hearing the appellants as G directed above. The Appeals are disposed of accordingly. No costs. N.J. Appeals disposed of. H