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Judgment
Kulwant Singh Tiwana, J.—Letters Patent Appeal No. 281 of 1975 arises from the judgment of the learned Single Judge of this Court deciding Civil Writ Petition No. 4513 of 1974. Letters Patent Appeal No. 374 of 1975 (M/s Din Dayal Mahadev Parshad v. Market Committee, Rewari) arises out of the judgment of the same learned. Single Judge of this Court dismissing Civil Writ Petition No. 1402 of 1974. In both these writ petitions, a common question, as to whether sulphur sugar/dana falls within the definition of agriculture produce being Khandsari as contained in the schedule of the Punjab Agricultural Produce Markets Act 1961 (hereinafter referred to as the Act) and is subject to the levy of market fee, is involved. The learned Single Judge taking the view that sulphur sugar/dana is from the family of Khandsari and is thus an agricultural produce, dismissed both the writ petitions. These two appeals under clause X of the Letters Patent have been directed against the aforesaid judgments.
The same question as was argued before the learned Single Judge has been raised before us on behalf of the appellants in these appeals as to whether sulphur sugar/dana is khaadsari as entered in the schedule of the Act and is thus an agricultural produce as defined in the Act.
The learned counsel for the appellant have urged that sulphur sugar/dana is manufactured in a different process than Khandsari and there is always a difference in the price of these two commodities and their names are different. They have further argued that the word, "sulphur sugar/dana" is always used in contra-distinction to Khandsari, as they are treated as different commodities by the business community trading in this commodity. They have urged that because of these factors sulphur sugar/dana cannot be taken to be Khandsari.
It is an admitted case of the parties that both Khandsari and sulphur sugar/dana are prepared from the sugar-cane juice, which is the basic raw-material, with open pan system. This process is distinguished from the advanced and sophisticated method of sugar by vacum pan system. Before the actual starting of the process of manufacture in the pan, in case of sulphur sugar/dana, the sugar-cane juice is clarified and is denuded of the impuritires by a treatment with sulphur dioxide gas. This process has come to be known as sulphitation process. As this assimilation of the gas in the juice results into the manufacture of better and clear sugar crystal, this preparation has come to be known as sulphur sugar to distinguish it from its fore-runner-khandsari for the preparation of which the sugar cane juice is not given sulphur treatment. The rest of the process is almost the same. Khandsari in the final stages of the manufacturing process, for the purpose of crystallisation, is prepared through manually operated centrifugral machines while sulphur sugar at the final stages is put in the centrifugal machines operated by power. At page 49 of the Report of the Sugar Enquiry Commission published by the Government of India in October, 1965, it is stated ; "the old system of producing Khandsari is now being replaced by modern system of using power crushers and centrifugal machines". It has also been stated at page 50 of this Commissions report: "As many as 114 Khandsari units using sulphitation process of Clarification are reported to have been established in recent years."
A memorandum was presented to the Tarriff Commission in 1968 by the Indian Sugar Mills Association, Calcutta. This memorandum contained a reference to the process of manufacture of Khandsari at page 210 in the following terms :
The Khandsari process of making sugar has recently been improved to a great extent resulting in great improvements in sugar recovery and quality The sulphitation process of clarification has been intrauced to Khandsari making as also improved methods of boilding and crystallisation. The equipments have also been modernised, with the result that crystal size sugar as well as colour have improved almost approximately to vacum pan sugar.
In Civil Writ Petition of No. 4513 of 1974, the appellants in para 5 of the replication stated about the process of manufacture of the sulphur sugar:
Sulphur sugar cannot be manufactured without the use of milk of lime and sulphur dioxide (SO2) processed in the sulphitation vessel only whereas the manufacture of Khandsari does not require sulphitation process at all since it can be manufactured from the juice purified by other simple methods.
The report of the Sugar Enquiry Commission and the memorandum submitted to the Tariff Commission by the persons who are conversant with the technicalities of production and market conditions of sugar clarify the position to state that the technique of production of Khandsari and sulphur sugar is the same. The passages quoted from the above reports of the experts and persons dealing in these commodities are literally the same Even the passage quoted from the replication in Civil Writ Petition No. 4513 of 1974 shows that except the process of sulphitation, there is no other difference between the process of manufacture of these two varieties of the same species derived from the same genesis. The process of manufacture of these two commodities is the same except the manner of clarification of the sugar-cane juice and the manner of crystallisation of the ultimate product for a better marketability. The memorandum submitted to the Tariff Commission and the report of Sugar Enquiry Commission, which are authentic so far as the methods of production of Khandsari and sulphur sugar are concerned, show that sulphitation process has been introduced in the manufacture of Khandsari. The use of the power operated centrifugal machines for crystallisation in case of a sulphur sugar is the benefit of the advanced technology utilised by the producers to achieve an economical and improved produce. The argument of the learned counsel for the appellants that the process of manufacture distinguishes one commodity from the other does not have any merit in it in view of the above reports and the process being the same.
The next argument that there is difference in the market price of these commodities does not deserve any serious consideration. It is the admitted case of the parties that sulphur sugar/dana is whiter in colour than Khandsari and its crystals are also bigger than that of the later This is because of sulphitation process, with which the raw material in the ease of sulphur sugar is treated and the use of power operated centrifugal machine. This difference and the quality make an obvious difference in the prices We had a look on the market price of Khandsari and sulphur sugar as quoted in the daily news papers and find that there is very little difference in the prices of Khandsari superior and sulphur sugar Such, a nominal difference does not contradistinguish one thing from the other.
As has been discussed in the previous paragraphs, sulphur sugar/dana has been given a name because of the sulphitation process. It is not uncommon with the business community to give two names to different brands of the same commodity. It appears that sulphur sugar has been given this name only to depict the shade of difference in the colour and the size of the crystal, otherwise the name alone does not tend to show that these are two different commodities.
Another argument raised en behalf of the counsel for the appellants is that sulphur sugar/dana and Khandsari are understood to be different commodities by the business community and for that reason they are put in the newspapers in the ''rates column'' under separate names. To know how a commodity is understood in the commercial circles or by the person who deal with it, the opinion of people who are deemed to be technically conversant with the manufacture, sale etc, of a particular commodity is always beneficial. A passage from the memorandum presented to the Tariff Commission by the Sugar Mills Association, Calcutta, clarifies this position. These persons in sugar business have clearly put in their memorandum that sulphitation process is applied to Khandsari. The above quoted opinion of the Indian Sugar Mills Association, Calcutta, is an indicator how this commodity is understood in the manufacturing and the business circles. Mere descriptive names do not tend to depict an altogether different character of the commodity only because of the assimilation of certain clearing agents for the achivement of better results.
In Tungabhadra Industries Ltd, Kurnool v. Commercial Tax Officer, Kurnool (1960) 11 S.T.C. 827, the facts were that the taxation authorities did not allow deduction to the assessee dealing in groundnut oil after expressing it from the groundnut, in respect of the refined and hydrogenated oil on the ground that it was only unrefined and unprocessed groundnut oil that was covered by the expression '' groundnut Oil in the relevant rules it was held, "To be groundnut Oil, two conditions have to be satisfied. The oil in question must be from the groundnut and secondly the commodity must be ''oil''. That the hydrogenated oil sold by the appellants was out of groundnut not being in dispute, the only point is whether it continues to be Oil evenafter hydrogenation. Oil is a chemical compound of glycerine with fatty acids principally oleic, linoleic, stearic, and palmitle the proportion of the particular fat varying in the case of the oil from different oil seeds and it remains a giyceride of fatty acids even after he hardening process, though the relative proportion of the different types of fatty acids undergoes a slight change. In its essential nature, therefore, no change has occurred and it remains an oil a glyceride of fatty acids that it was when it issued out of the press" The process of clarification and the final finish does not, in our view, take sulphur sugar/dana out of the definition of Khandsari. After hearing the counsel for the parties we have come to form an opinion that sulphur sugar/dana is nothing but an improved version or Improved quality of Khandsari There is no difference in the process ''of manufacture nor these two items are differently understood by the consumers or the business community.
''Agricultural produce'' has been defined in Section 2 (a) of the Act as follows :--
''Agricultural produce'' means all produce, whether processed or not, of agriculture, horticulture, animal husbandary or forest as specified in the Schedule to this Act.
Under Section 23 of the Act, which is a charging section, the respondents have a right to levy market fee on sulphur sugar/dana being Khandsari.
The argument that the Administrative Officer for the Haryana Agricultural Marketing Board, Chandigarh, vide letter Annexure P. 1 bad written to the Secretary, Market Committee, Rewari that the sulphur sugar has not been included in the schedule. Hence market fee cannot be charged on it does not bind the respondents.
For the foregoing reasons, we do not find any merit in both the appeals and the same are hereby dismissed. The parties are left to bear their own costs.