Sparsh Cold Storage Pvt. Ltd. and Another vs State of U.P. and Others

Shri Anshu Chaudhary has accepted notice on behalf of Zila Panchayat, Mahamaya Nagar and appears for Respondent No. 3 also. Learned Standing Counsel appears for Respondent Nos. 1, 4 and 5. All the Respondents will file counter affidavit within three weeks. The Petitioners will have two weeks thereafter to file rejoinder affidavit.

List on 23.5.2011.

The Petitioners are challenging the imposition of licence fee on the cold storage run by it under the licence issued under the U.P. Regulation of Cold Storage Act, 1976 (the Act of 1976) with the capacity of 25837.98 square meters for 8268.15 metric tonnes under the bye-laws made with reference to Section 143/239 of U.P. Kshetra Panchayat and Zila Panchayat Adhiniyam, 1961 notified on 22.10.2003.

It is contended by learned Counsel for the Petitioners, that the cold storage has been constructed on the land purchased by it from its own resources. The Act of 1976 covers the field. The bye-law could be made, only if the land was leased out by the Zila Panchayat and further in any case, the activity of running cold storage does not fall within any of the category of Section 239 giving power to Zila Panchayat to make bye-laws. He has relied upon a judgment of this Court in U.P. Udyog Vyapar Pratinidhi Mandal and Others Vs. State of U.P. and Others,

Shri Anshu Chaudhari, on the other hand, submits that the Act of 1976 was enacted for a different object and reasons and also provides for right and duties of the licensee towards keeping their goods in cold storage. The regulation of any trade, business or activity u/s 239 of the Act of 1961 falls within the powers of the Zila Panchayat to make bye-laws subject to approval of the State Government and which also include the powers to impose licence fee. The licence is charged by the Zila Panchayat for maintaining health, safety and convenience of the inhabitants of the rural area of the district and for the furtherance of the administration of this Act in the Khand and the district. Sub-section (2) of Section 239 provides that in particular and without prejudice to the generality of the power conferred by Sub-section (1), a Zila Panchayat may, in the exercise of the said power, make any bye-laws in respect of (A) building; (B) drains, privies, cesspolls, etc.; (C) streets; (D) markets, slaughter-house, sale of food, etc.; (E) offensive trades; (F) Public safety and convenience; (G) sanitation and prevention of disease; (H) miscellaneous. He would submit that the activity of storage of food and vegetable and other edible consumable items would clearly fall within the general powers of the Zila Panchayat both with reference to public safety and convenience which also include the running of factories and storage in rural areas under Sub-section (1) of Section 239.

The judgment in U.P. Udyog Vyapar Pratinidhi Mandal''s case related to the transportation from within and into District and was not concerned with the activities carried on in the rural area itself.

Shri Anshu Chaudhari has relied upon a Full Bench judgment in B. Agarwal Stone Product Limited Vs. State of U.P. and Others, taking a view different view taken by this Court in U.P. Udyog Vyapar Pratinidhi Mandal''s case. He submits that the Zila Panchayat carries out several activities for benefit of resident of rural area. The Petitioner is running cold storage which falls within the definition of factory and the Petitioner has added many new chambers in his cold storage.

Prima facie, we find that the Act of 1976 operates entirely in different field and that the bye-laws for providing licence for maintaining health, safety and convenience of the inhabitants of the rural area are applicable to the cold storage, which is not a simple business of storage but also requires the other facilities to be provided namely road, water, sanitation to be maintained by Zila Parishad.

We, however, find that there is no classification of big and small cold storage in the bye-laws, and thus in order to check the arbitrariness in requiring the cold storages to take licence and pay licence fee, let the Petitioner deposit licence fee @ Rs. 10,000/- for the period for which it had demanded the payment of licence fee, which shall be subject to the result of the writ petition.