Rules - Andhra Pradesh (Agricultural Produce & Livestock) Markets Act, 1966 — Amendment to the Andhra Pradesh (Agricultural Produce & Livestock) Markets Rules, 1969 - Notification - Issued.



G.O.Ms.No.377                                                             Dated 29-09-2005  Read the following

1. G.O.Ms.No.1900, Food & Agriculture (Legislation) Department,

 dated 17.10.1969.


3. From C&DoM., Lr.No.L(l)764/2005, Dated 21.7.2005.


                 The following notification will be published in the Extra-Ordinary issue of the

Andhra Pradesh Gazette dated


Whereas, in view of the changed scenario in the trading of Agricultural commodities and with the advent of World Trade Organisation, the Government of India have piloted a Model Markets Act providing with various options and communicated to all the States for adoption. The Model Act is mostly based on the Andhra Pradesh Markets Act, 1966, with a few exemptions like private marketing and contract farming. As a part of liberalization, certain amendments have to be made to the Andhra Pradesh (Agricultural Produce and Livestock) Markets Rules, 1969 relating to issue of licences by increasing licence fee, re-fixing the turnover and period of licence etc.;

2.                                       And whereas Govt. have carefully studied the several issues involved and
considered  the  need  to  proceed  with  certain   amendments  to  the   existing  A.P.
(Agricultural Produce & Livestock) Markets Act, 1966.

3.                                       And whereas, the Governor of Andhra Pradesh has promulgated the Andhra
Pradesh (Agricultural Produce and Livestock) Markets (Amendment) Ordinance, (A.P.
Ordinance No.4 of 2005) 2005 and A.P. Ordinance No. 11 of 2005 suitably amending the
provisions of the said Markets Act, 1966 and the same have been published in Part IV-B,
Extraordinary  the  Andhra  Pradesh  Gazette  on   10tln  May,   2005   and   10.06.2005

4.                                       And whereas, it is proposed to amend the Andhra Pradesh (Agricultural produce
and Livestock) Markets Rules,  1969 issued in G.O.Ms.No.1900, F&A Department,
dt.17.10.1969 suitably so as to make provisions for private marketing and contract

5.                                       Now, therefore, as required under sub section (4) of section 33 of the Andhra
Pradesh (Agricultural produce and Livestock) Markets Act, 1966, notice is hereby given
that the said amendment will be taken into consideration by the Government on or after
the expiry of a period of thirty (30) days from the date of publication of this Notification
in the Andhra Pradesh Gazette and any objections or suggestions which may be received
with respect thereto may be considered by the Government of Andhra Pradesh.


6. The objections and suggestions may be sent to Principal Secretary to Government, Agriculture & Cooperation Department, Andhra Pradesh, Hyderabad, through the Commissioner & Director of Marketing, Andhra Pradesh, Hyderabad.

In the said Rules:
I           After rule-53, the following rule shall be inserted, namely,

"53-A:-     Application for grant of licence under sub-section (7) of section 7 of the Act and fees chargeable therefor.

(1)             Any person desiring to obtain a licence to establish a private market in a
notified area within the State shall make an application to the Government
through the Director of Marketing inForm.7-A.

(2)             Every such application shall be accompanied with a licence fee of Rs.50,000/-
(Rupees Fifty Thousand only) paid to the Agricultural   Market Committee
concerned.   The amount is refundable only if the licence is not granted for
reasons other than non-compliance of requirement of the conditions under the
Act, retaining 5% of the fee paid towards processing cost.

(3)             Every such application shall be accompanied with:


(a)        a detailed project report showing the financial status of the applicant
with the support of Income Tax returns for the previous three assessment
years OR permanent assets with valuation assessed by a Chartered

(b)        the report shall also contain details such as the extent of land in which
the market is proposed to be established, locations at which procurement
centers, if any, intended to be set up and out lays proposed to be spent
for  setting  up   facilities,   for  purchase/sale  and  storage  of notified
agricultural produce, livestock or products of livestock, amongst others
establishing the markets for processing, grading, packing, storing and for
sale/export of the produce by way of value addition.

(c)        Outlays earmarked for providing facilities, if any, like lodging, boarding
to the growers who bring produce to the private market, for establishing
laboratory facilities to evaluate and determine the quality of the produce
after processing to satisfy the sanitary and phytosanitary requirements of
the consumers if any of such produce with an outlay of not less than
Rs.10.00 Crores (Rupees Ten Crores only), for all such facilities to serve
the consumer.

(4)        The Director of Marketing shall evaluate the project report submitted by the
applicant and may in consultation with the persons as he deems fit and
suggests such measures as he may deem it necessary for improving the
efficiency of market for consideration of Government, within 90 days from
the date of receipt of the project report and the Government may issue the
letter of intent
for commencement of the project based on such evaluation.

(5)  (a)   On completion of the implementation of the project, the applicant shall give

an intimation to the Director of Marketing. The Director of Marketing on receipt of intimation shall thereupon inspect and satisfy himself about the completion of the project with all facilities as per the project report and issue a certificate. In case of failure by the applicant to implement the project either within the project implementation period mentioned in the permission or within such extended time, the Government may refuse the grant of licence for reasons to be communicated.

(b) On receipt of the certificate about completion of implementation of the project from Commissioner & Director of Marketing, Government may grant/renew licence in Form 7-B with such conditions specified for a period not exceeding 10 years.

(6)             The person licenced may, start making purchases from the growers of the area
or areas specified in the licence only after receipt of the licence. However, in
the event of cancellation of licence owing to failure to implement the project,
the person licenced shall forthwith stop making purchases under the licence.

(7)             The Director of Marketing or the officers authorized by him not below the rank

of an Assistant Director of Marketing shall have power to inspect the private market.

(8)       The licensee shall submit monthly returns of purchases made from the growers

to the Assistant Director concerned and pay the Market Fee to the concerned market committee by 25th of the succeeding month. He shall also furnish the sale returns pertaining to processed goods.

(9)       The licensee shall make the payment of sale proceeds to the grower by issuing
a sale bill on the day of sale, allow only such allowances and deductions as are
permitted in the rules, collect market charges not exceeding as are applicable
in other markets in the notified area and maintain such registers and furnish
such returns to the Director of Marketing or to such other officer as he may

(10)     In case of complaints and disputes between the farmers and management of
the private market it shall be referred to the Director of Marketing or a
committee of which constituted by him to resolve the disputes and the
decision shall be binding on them".

II         After Rule 73, the following rule shall be inserted namely: -"73-A:   CONTRACT FARMING.

(1)   The contract farming agreement between the contract farming producer and contract farming buyer shall be in Form 11-A.

(2)    (a)   The agreement is to be entered   before the sowing of the crops.

(b)   In case of existing horticultural crops th^ time of agreement can be at the stage of flowering or as per tradition.

(3)       All the blanks in the agreement form shall be filled in words and should not be
left blank.

(4)       In the case of contract farming with producers situated in more than one notified
areas of the Market Committee, Assistant Director of Marketing of the District in
which the main/Head Office of the contract farming buyer is situated is the
authority to register the contract farming.

(5)       The Market Committee or the Assistant Director of Marketing as the case may be
shall maintain the register in the following form prescribed by Director of
Marketing from time to time.

(6)       Contract fanning Buyer is responsible to take possession o f  the produce a 11 he
farm or village after correct weighment and payment duly issuing a purchase bill.
He shall obtain the signature of the producer on the purchase bill in token of
having received the payment and one copy of the purchase bill should be
submitted to the Agricultural Market Committee in whose area the land is
situated.     Incidental  expenditure being incurred  due to handling,  loading,
unloading, weighment,  stitching,  including containers is to be borne by the
contract farming buyer.

(7)       The contract farming buyer shall pay Market Fee on the purchases made by him
every month by furnishing purchase returns by 25t of the succeeding month.

(8)       The  Market  Committee/Assistant  Director  of Marketing and  the  appellate
authority have the power to award costs to the defaulting party while resolving the
dispute arising between the parties in respect of the terms and conditions of the

III.   After Form 7, the following shall be inserted, namely, -


(Under Rule 53-A)

Application for licence under sub-section (7) of section 7 of the Andhra Pradesh (Agriculture Produce & Live Stock) Markets Act, 1966.


1) Name of the applicant                                               :

2)  Name of the applicant's
Father / Husband (in case of

3)  Address


The Secretary to the Government,

___________________ Department,

Government of A.P., Hyderabad. Through The Director of Marketing., Hyderabad.


I / we the undersigned hereby apply for the issue of licence under sub­section (7) of section 7 of the Andhra Pradesh (Agriculture Produce & Live Stock)

Markets Act,1966 to establish a private Market at ........................................................ in the

notified                area           .   of               Agricultural                 Market               Committee

................................................. District................................ for purchase of......................................

(Commodities) as detailed in the project report enclosed for the area.

I / we abide by all the provisions of the said Act and relevant Rules made there under from time to time.

I / we have remitted a fee of Rs.50,000/- (Rupees Fifty Thousand only) for issue of the licence and receipt of the same is enclosed.


Signature of the Applicant."


IV.    After Form 7-A, the following shall be inserted, namely,-

"Form 7-B


(Form of License for establishment of private market u/s 7 (7) of the Markets Act, 1966)
License No.:                                                                             Issued by:

Under sub section (7) of Section 7 of the Andhra Pradesh (Agricultural Produce

& Livestock) Markets Act, 1966, Sri/M/s. ____________________________________

____________________is/are  hereby  licenced  to   setup/establish  a  market/procurement

centers for purchase of notified agricultural commodities/livestock and products of livestock from the fanners and for sale/exports and for processing, grading, packing, storing of the produce by way of value addition in the premises described in the

schedules  below  and  situated  in  _________________________area  notified  under

Sections 3&4 of the said Act as places for the purchase/sale/export/processing/grading/packing/storing/pressing/weighment/curing of any notified agricultural produce and livestock and products of livestock for the period

commencing from________________________ and ending with________________ in

accordance with the provisions of the said Act and the Andhra Pradesh (Agricultural Produce & Livestock) Markets Rules, 1969.

Place    :

Date     :                                                                       Issuing Authority


1.              This licence shall not be transferable.

2.              The   licensee shall abide by all the provisions of the Markets Act and Markets
Rules made thereunder and orders issued by the Government from time to time.

3.              The licensee shall submit the monthly purchase returns to the Assistant Director of
Marketing concerned  and remit the market  fee  to the market committees

4.              The licensee shall pay the market fee and also facilitate the collection of market
fee under Section 12 of the said Act due to the market committee as and when it
becomes due as per the provisions of the Markets Act and Markets Rules.

5.              The licensee shall collect the market fee due from the purchaser and remit to the
market committee and shall deliver the goods to the purchaser after satisfying
himself fully that the purchaser has paid the market fee.

6.                      The licensee shall during the business hours on any day allow access to any
officer of the Marketing Department to inspect all his books of accounts and any
other related records for the purposes of the Markets Act and Markets Rules.

7.                      Any  contravention  of the  aforesaid  conditions  will  entail  suspension  or
cancellation of licence in addition to the liability for prosecutions as per the
provisions of the Markets Act and Markets Rules.




Name o f t he Taluk

Name of the Town        or village

Ward      and Block No.

Revenue   or Town Survey No.

Name       of street








Door No.



Description of premises











V.    After Form 11, the following shall be inserted, namely,-

"FORM. 11-A


Agreement Between

Sri.................................................. S/o ………………………………………….

R/o................................. Village................................. Mandal................................

District..................................... Herein after referred to as contract farming seller

or simply seller



M/s....... …………………………


herein after referred to as contract fanning buyer or simply buyer.

We, the above said contract farming seller and contract farming buyer
mutually agree for the following terms and conditions for production and purchase and
sale of........................................... (Commodities).

1.          The seller owns / taken on lease on extent of................... Acres of land in Survey

No................... of............... Village..................................... Mandal....................

.............. District.......................................

2.          The seller agreed to produce........................................ (Commodity) required by

the buyer during.......................... season of.............................. (year / years).

3.          The buyer agreed to provide the services with service charge specified
hereunder / for production of the said commodity / commodities by the seller.
The seller agreed to recover the service charges from the sale proceeds
payable to him.

Details of Service                                           Service charge.

4.         The Buyer agreed to purchase the commodity conforming to specifications at the rates explicitly given here under.

Commodity                               Specification                 Rate per Kg./Qtl.

(1)                                            (2)                                      (3)

5.                  The Buyer cannot demand damages if the produce harvested does not conform
to the specifications and quantity agreed upon.

6.                                      The Buyer has agreed to purchase the entire quantity/............................... Quintals

produced by the seller at the rate/s as at para 4 above.

7.                  The seller has agreed to deliver the agreed quantities of commodities first to
the buyer and if and only if there is any left over quantity, he is at liberty to
dispose of the commodities to others.

8.                                      The Buyer has agreed to take delivery of the commodity at the farm/villages
after weighment and payment by incurring all expenditure incidental there for,
like handling, weighment, cost of containers etc.



9.                                     The Buyer has agreed not to refuse to take delivery of the quantity of produce
conforming to specifications given at paras 6 and 4 above.

10.                              The Buyer has agreed to give a third party guarantee in the form of bank
guarantee for the entire value of the contract agreement.

11.                              In case the seller sells the produce to any other person in violation of the terms
of the agreement, the buyer may approach the Market Committee / Assistant
Director of Marketing for redressal. Market Committee / Assistant Director of
Marketing shall proceed against the seller including attachment of stocks and
properties belonging to the seller.

12.                              The Buyer can claim the loss suffered by him for breach of agreement by the

13.                              In case the Buyer fails to take delivery of the produce, the seller can ask
Market Committee / Assistant Director of Marketing to recover the loss
sustained by him from the bank guarantee furnished by the buyer.

14.                              Any dispute arising out of this agreement shall be resolved as per sub­
sections (3) and (4) of section 11-A of the Andhra Pradesh (Agriculture
Produce & Live Stock) Markets Act, 1966.

15.                              The agreement ceases to be in force on..................................... (Date).

Signature of the contract                                                           Signature of the contract

farming Buyer.                                                                          farming producer.


1.                                                                                                                                                 1 .Name and address

2.                                                                                                                                                 2.Name and address "





The Commissioner of Printing, Stationery & Stores Purchase (Printing Wing), A.P., Hyderabad - (He is requested to publish the Notification immediately in the next issue of the extra-ordinary A.P. Gazette and supply 1000 copies to Agri. & Coop. Dept., and 100 copies to C&DoM., A.P., Hyderabad).

The Commissioner & Director of Marketing,

A.P., Hyderabad.

Copy to:

The Law (B) Department.

The P.S. to Addl. Secy, to CM.

P.S. to Prl.Secretary(Coop.).


//Forwarded by order//



O/O Commissioner & Director of Marketing. Govt. of Andhra Pradesh, Hyderabad. L (1)764/2005                                                                        Dt:      -10-2005

Communicated for necessary action.


Commissioner & Director of Marketing


All Agricultural Market Committees in the State through concerned Districts Asst. Directors of Marketing, for information and necessary action.

Copy to all Deputy Director of Marketing/

Joint Director of Marketing in the State for necessary action.


Copy to the President FAPCCI, Hyderabad. Copy to the C.I.I. Hyderabad.