Garlic– Vegetable Or Spice In MP Krishi Upaj Mandi Law? High Court Upholds Order Reclassifying Garlic As Vegetable In Bye Laws

The Indore bench of the Madhya Pradesh High Court in a recent order discussed the classification of garlic–as a vegetable or as a spice–under the state's agricultural produce market law.  

The high court allowed a review plea filed by petitioner–Aaloo Pyaj Commission Agents which trades in garlic, and set aside an earlier order that curtailed the authority of the Managing Director of the Madhya Pradesh State Agricultural Marketing Board to amend by-laws regarding the trade of garlic. 

After perusing the provisions of the 'M.P. Krishi Upaj Mandi Adhiniyam', a division bench of Justice Sushrut Arvind Dharmadhikari and Justice Duppala Venkata Ramana in its order said, "From bare perusal of Section 81 of the Adhiniyam categorically deals with the powers of the Board to make amendment or amend the bye-laws empowering the marketing Committee to amend the bye-laws to any extent for various purposes. Section 60 of the Adhiniyam, 1972 deals with a different situation and contemplates a different issue all together empowering the State Government to amend the schedule only. The State Government alone has the power to amend the schedule". 

The bench said that in the present matter, "Garlic(dry or wet) continues" to be in the same Schedule (in the Adhuniyam) i.e. Schedule - X pertaining to condiments, spices and others.

The bench thereafter said that an "apparent error" had crept while interpreting Sections 60 and 80 of the 1972 Adhiniyam. It further observed that the Managing Director Mandi Board had amended the bye-laws and not the Schedule to the 1972 Adhiniyam.

For context Section 60 of the 1972 Adhiniyam pertains to the Power of State Government to amend Schedule. Meanwhile Section 81 pertains to the Power of Managing Director to direct making or amendment of bye-laws

"Because of the aforesaid misinterpretation in the writ appeal order, the farmers/agriculturist are bound to sell the Garlic (Wet or Dry) to the Government bodies only. Infact, the Managing Director has exercised its power in accordance with law. The apparent error on the face of the record has crept in while passing the order in writ appeal. Accordingly, the order dated 23.01.2024, passed in W.A. No.130 of 2017 is set aside. As a consequence, the order dated 07.02.2017, passed in W.P. No.1943 of 2016 is hereby restored," the bench said while allowing the review plea. 

In doing so the division bench reinstated the decision of the single judge bench in 2017 which had said that the Managing Director can direct the Mandi Committee to amend the bye-laws if it appears to him that it is necessary and desirable.

Background

The petitioner–a registered society–is in the business of trading of Onion, Potato and Garlic in the relevant Mandi market at Indore and are registered licencees to operate and function in that capacity in the Mandi. The members of the petitioner society get commission in the capacity of “Commission Agent” for selling Onion, garlic and Potato of the farmers directly and paying them in cash. The sale of the product is carried out through traders or customers on a credit basis. This transaction ensures an immediate payment to the farmers while the money that is to come to the members of the petitioner Association is, more often than not, received after a few days. 

Under Section 80 of the Adhiniyam, a body called the Market Committee is authorized to frame bye-laws in respect of the market area under its management to regulate its business, conditions of trading and market duties and functioning of the committee and sub-committees. 

The Marketing Committee had framed its bye laws in 2000 to regulate the sale and purchase of vegetables in the Krishi Upaj Mandi.

The dispute emerged after the Managing Director in its March 13, 2015 order directed all the Mandis to amend the 2000 bye-laws by inserting clause (16) (7) for garlic (dry and wet) which was in the category of spices and others, to be treated under the category of fruits and vegetables "because garlic is a perishable commodity". 

In the first round, the decision was challenged before the high court which disposed it of with liberty for filing an appeal before the competent authority i.e. State Government. 

Thereafter the State Government in its February 24, 2016 order allowed the appeal and the order of the Managing Director and a subsequent resolution was set aside on the ground that only the State Government has the authority to amend the Schedule-1 appended to the 1972 Adhiniyam.

This led to the Aaloo Pyaj Commission Agents filing a writ petition, which was initially allowed by a Single Judge Bench in 2017, affirming the Managing Director's authority under Section 81 of the 1972 Adhiniyam to amend by-laws. However, this decision was subsequently overturned by the division bench in a writ appeal on January 23 this year. The petitioner thereafter moved a plea seeking review of the January order. 

Case title: Aaloo Pyaj Commission Agents Versus State Of Madhya Pradesh & Ors.

Case No: R.P. No.211/2024 & R.P. No.753/2024

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