Chapter II ESTABLISHMENT OF MARKETS

3. Notification of intention of regulating the marketing of specified agricultural produce in specified area.- (1) The State Government may, by notification, declare its intention of regulating the marketing of such agricultural produce, in such area, as may be specified in the notification. The notification may also be published in Kannada in a newspaper circulating in such area.

1. (2) The notification shall state that any objections or suggestions which may be received by the State Government within such period as shall be specified in the notification, not being less than thirty days, will be considered by the State Government. 4. Declaration of market area and of regulation of marketing of specified agricultural produce therein.- After the expiry of the period specified in the notification issued under section 3, and after considering such objections and suggestions as may be received before such expiry, the State Government may, by another notification, declare the area specified in the notification issued under section 3 or any portion thereof to be a market area and that the marketing of all or any of the kinds of agricultural produce specified in the notification issued under section 3 shall be regulated under this Act in such market area. A notification under this section may also be published in Kannada in a newspaper circulating in such area. 1[Provided that a market area shall not be less than a taluk and more than a district: Provided further that if on the date of commencement of the Karnataka Agricultural Produce Marketing (Regulation) and Certain Other Laws (Amendment) Act, 1991, any market area is more than a district or less than a taluk such market area shall be altered or market committees of such market area shall be amalgamated so that the market area shall not be more than a district or less than a taluk and the provisions of sections 5, 142 and 144 shall, mutatis mutandis apply for such alteration of limits and amalgamation.]

¹ Inserted by Act 16 of 1991 w.e.f. 1.8.1991

Subject to the procedure specified in sections 3 and 4 , the State Government may, at any time by notification, exclude from any market area, any area or include therein an additional area, or may declare that the regulation of the marketing of any agricultural produce in any market area shall cease, or that the marketing of any agricultural produce (hitherto not regulated) shall be regulated in such market area.

1. (1) (a) For every market area,-
   • (i) there shall be a market, and
   • (ii) there may be one or more sub-markets;
   • (b) For every market,-
     • (i) there shall be a market yard, and
     • (ii) there may be one or more market sub-yards;
   • (c) For every sub-market there shall be 1[one or more sub-market yards.] 1[(1A) in any market area, there may be one or more private market yard or farmer - consumer market yard managed by a person who is a private market licencee or farmer - consumer market licencee other than the market committee.]
2. (2) (a) The 1[Director of Agricultural Marketing] shall, as soon as possible after the issue of a notification under section 4, by a notification, declare any specified area in the market area to be a market. He may also by the same notification or by any subsequent notification declare any other specified area 2[including a warehouse] in the market area to be a sub-market.
   • (b) The 1[Director of Agricultural Marketing] shall by a notification under clause (a) also declare a specified place 2[x x x] in the market to be a market yard for the regulated marketing of the notified agricultural produce specified in the notification. He may also by the same notification or by any subsequent notification or notifications declare 3[any other specified place or places] , as the case may be, 2[x x x] , in the market to be a market sub- yard or sub-yards for the regulated marketing of the notified agricultural produce specified in the notification.
   • (c) Where by a notification under clause (a) any specified area is declared to be a sub- market, the 3[Director of Agricultural Marketing] shall by the same notification declare a specified place 1[x x x] in the sub-market to be a sub-market yard for the regulated marketing of the notified agricultural produce specified in the notification: 4[(d) The Director of agricultural marketing may, by notification, declare a place, licenced under section 72C, in the market area to be a private market yard or farmer - consumer market yard as the case may be, as may be specified in the notification, for marketing of notified agricultural produce.] Provided that the limits of the market or the sub-market, as the case may be, shall not include any area beyond the limits of the area of the city, town or village within which the market yard or the sub-market yard, as the case may be, is situated: 2[Provided further that if in respect of any market area, the 1[Director of Agricultural Marketing] is of the opinion that a suitable place for the location of the market yard or sub- market yard cannot be easily secured within the limits of the area of a city, town or village, proposed to be declared as a market or sub-market, he may declare an area including one or more villages, beyond the limits of a city, town or village to be a market or sub-market and declare a place in any such village to be a market yard or sub-market yard for such market or sub-market.] 5[ 6[Provided also that, the Director of Agricultural Marketing may declare a warehouse, silos, cold storage, pack houses, cleaning, grading and packaging unit as sub-market, market sub-yard or sub-market yard as the case may be in such manner as may be prescribed.] ] 7[Provided also that, all processing units licensed by the market committee which is outside the market yards and within the market area, shall be deemed as sub-market, market sub-yard or sub-market yard as the case may be for the purpose of regulation.] 1[(2A) In respect of any market area declared under any of the enactments repealed by sub-section (1) of section 154, the 2[Director of Agricultural Marketing] may, as soon as possible after the commencement of this Act, and subject to the provisos to sub-section (2), declare by notification, any specified area in such market area to be a market, any other specified area in the market area to be a sub-market, a specified place in the market to be a market yard, any other place or places to be market sub-yard or market sub-yards, and a specified place in the sub-market to be a sub-market yard.]
3. (3) Subject to the procedure prescribed in sections 3 and 4 , the 2[Director of Agricultural Marketing] may at any time by a notification 1[alter any market or sub-market or any market yard, market sub-yard or sub-market yard or] exclude any area from any market or sub-market or any place from any market yard, market sub-yard or sub-market yard, or include therein, subject to the 3[provisos] to sub-section (2), an additional area or place, as the case may be, or may direct that the regulated marketing of any notified agricultural produce in any market yard, or market sub-yard, or sub-market yard shall cease or that any notified agricultural produce shall be included in the regulation of marketing in any such yard or sub-yard.

¹ Substituted by Act 35 of 1986 w.e.f. 17.6.1986

¹ Inserted by Act 23 of 2007 w.e.f. 16.8.2007

¹ Substituted by Act 35 of 1986 w.e.f. 17.6.1986

² Inserted by Act 05 of 2014 w.e.f. 04.01.2014

¹ Substituted by Act 35 of 1986 w.e.f. 17.6.1986

² Omitted by Act 19 of 1969 w.e.f. 1.5.1968

³ Substituted by Act 19 of 1969 w.e.f. 1.5.1968

¹ Omitted by Act 19 of 1969 w.e.f. 1.5.1968.

² Inserted by Act 19 of 1969 w.e.f. 1.5.1968.

³ Substituted by Act 35 of 1986 w.e.f. 17.6.1986.

⁴ Inserted by Act 23 of 2007 w.e.f. 16.8.2007.

⁵ Inserted by Act 05 of 2014 w.e.f. 4.1.2014.

⁶ Substituted by Act 19 of 2025 w.e.f. 25.03.2025

⁷ Inserted by Act 19 of 2025 w.e.f. 25.03.2025

¹ Inserted by Act 19 of 1969 w.e.f. 1.5.1968

² Substituted by Act 35 of 1986 w.e.f. 17.6.1986

1[Explanation.- In this section, the expression "place" shall include any structure, enclosure, open place, locality or street, whether vested in the market committee of the market area or not.]

¹ Inserted by Act 19 of 1969 w.e.f. 1.5.1968

² Substituted by Act 35 of 1986 w.e.f. 17.6.1986

³ Substituted by Act 19 of 1969 w.e.f. 1.5.1968

1[(4) For the removal of doubts it is hereby declared that after the alteration of a market area or of the items of regulated agricultural produce, if any, under section 5, it shall not be necessary for the

2[Director of Agricultural Marketing]

to make any declaration under this section unless he is of the opinion that it is necessary to declare any area other than the existing market, sub-market, market yard, market sub-yard, or sub-market yard as market, sub-market, market-yard, market sub- yard or sub-market yard, as the case may be.]

¹ Inserted by Act 4 of 1982 w.e.f. 1.5.1968

² Substituted by Act 35 of 1986 w.e.f. 17.6.1986

As soon as may be after the issue of the notification under sub-section (2) of section 6 and the making of the first bye-laws under section 149, the

2[Director of Agricultural Marketing] shall, after satisfying himself that the market committee has made arrangements for regulating the marketing of notified agricultural produce in the market area by a notification, declare a date not less than thirty days from the date of issue of the notification as the date on which the market and the sub-markets, if any, shall be established. For all purposes of this Act, the market and the sub-markets, if any, shall be deemed to have been established for the market area with effect from the date so notified:

1[Provided that in the case of a market or sub-market notified under sub-section (2A) of section 6, the market or sub-market shall be deemed to be established on the date of the notification of the

1[Director of Agricultural Marketing] .]

¹ Inserted by Act 19 of 1969 w.e.f. 1.5.1968.

² Substituted by Act 35 of 1986 w.e.f. 17.6.1986.

1[the market is established] ,-

1. (a) no local authority shall, notwithstanding anything contained in any law for the time being in force establish, authorise or continue or allow to be established, authorised or continued any place in the market area for the marketing of any notified agricultural produce: Provided that a local authority may establish or continue any place for retail sale of any notified agricultural produce 2[other than cattle, sheep and goats] subject to the condition that no market functionary shall operate in such place except in accordance with the provisions of this Act, and the rules and the bye laws and standing orders of the market committee;
2. (b) no person shall, without, or otherwise than in conformity with the terms and conditions of, a licence granted by the market committee 2[or the Director of Agricultural Marketing or the officer authorized by him] in this behalf,-
   • (i) use any place in the market area for the marketing of the notified agricultural produce, or
   • (ii) operate in the market area or in any market therein as a trader, commission agent, broker, processor, weighman, warehouseman, or in any other capacity in relation to the marketing of the notified agricultural produce: Provided that nothing contained in clause (b) shall apply,-
   • (i) to the sale of such agricultural produce if the producer of such produce is himself its seller, or 1[(ii) to the purchase of such produce if the purchaser is a person who purchases such produce for his domestic consumption;] :- 4[ 3[ 2[ 1[(2) No place except the market yard, market sub-yard, sub-market yard, private market yard or farmer-consumer market yard, as the case may be, shall be used for purchase or sale of notified agricultural produce.] ] ] ] 3[ 2[ 1[(3) Nothing in sub-section(2) shall apply to,-
3. (a) the purchase or sale of notified agricultural produce by,-
   • (i) a Taluk Agricultural produce Co-operative Marketing Society;
   • (ii) a Primary Agricultural Co-operative Credit Society; and
   • (iii) any other Co-operative Society permitted by the State Government.
4. (b) the sale of notified agricultural produce by a retail trader.
5. (c) a sale by a contract farming producer to a contract farming sponsor under contract faming agreement.
6. (d) a direct purchase of notified agricultural produce by a licensee from the agriculturist under section 72-A of the Act. ] ] ]

¹ Substituted by Act 19 of 1969 w.e.f. 17.6.1986

² Inserted by Act 17 of 1980 w.e.f. 30.6.1979

¹ Substituted by Act 43 of 1976 w.e.f. 1.6.1976

² Inserted by Act 20 of 2024 w.e.f. 7.3.2024

¹ Substituted by Act 29 of 1987 w.e.f. 10.8.1987

² Substituted by Act 23 of 2007 w.e.f. 16.8.2007

³ Substituted by Act 59 of 2020 w.e.f. 16.05.2020

⁴ Substituted by Act 20 of 2024 w.e.f. 7.3.2024

¹ Inserted by Act 20 of 2024 w.e.f 7.3.2024

² Substituted by Act 29 of 1987 w.e.f. 10.8.1987

³ Omitted by Act 59 of 2020 w.e.f. 16.05.2020