Allahabad High Court
M/S J.H.V. Sugar Ltd. vs State Of U.P. And 4 Others on 17 December, 2019
Bench: Pankaj Mithal, Vipin Chandra Dixit
HIGH COURT OF JUDICATURE AT ALLAHABAD ?A.F.R. Court No. - 29 Case :- WRIT - C No. - 38530 of 2019 Petitioner :- M/S J.H.V. Sugar Ltd. Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Alok Kumar Srivastava,Shakti Swarup Nigam(Senior Adv.) Counsel for Respondent :- C.S.C.,Ravindra Singh Hon'ble Pankaj Mithal,J.
Hon'ble Vipin Chandra Dixit,J.
The petitioner J.H.V. Sugar Ltd. is a company incorporated and registered under the Companies Act, 1956 and is running a sugar mill at Gadaura, Tehsil Nichlaul, District Maharajganj.
The aforesaid sugar mill since 1999 has been allotted sugarcane area for the supply of the sugarcane for each crushing season. It has a crushing capacity of 4500 TCD.
The aforesaid sugar mill has been allotted sugarcane area for each of the crushing season from 2000-01 till 2014-15. In 2015-16 no allotment was made in its favour due to labour problem. Thereafter, sugarcane area was again allotted to it in the year 2016-17 and 2017-18. In the crushing season 2018-19 again the said mill had not functioned and as such no allotment was made.
In the present writ petition the petitioner has raised dispute regarding allotment of sugarcane area for the crushing season 2019-20.
It has filed the writ petition seeking a direction upon the respondent No.2 i.e. the Cane Commissioner, U.P. Lucknow to allot sugarcane area to its aforesaid mill for the year 2019-20 as per its crushing capacity.
Sri Shakti Swarup Nigam, Senior Counsel assisted by Sri Alok Kumar Srivastava, who appears for the petitioner has raised two points in support of the relief claimed in the petition.
The first is that the aforesaid sugar mill had been allotted sugarcane area in all the previous years from 2000-01 but for exception of two years and that there is no justification on part of the respondent No.2 to omit it from the allotment for the crushing season 2019-20. The said sugar mill has been singled out inasmuch as all other sugar mills in the State of U.P. have been allotted suitable appropriate areas.
Secondly, he submits that the respondent No.2 has acted in an arbitrary manner rather in a discriminatory manner in the allotment of the sugarcane area to the sugar mills. The mills that have defaulted in the payment of cane dues, have been allotted sugarcane areas whereas the petitioner's sugar mill has been left out probably on account of default in the payment of the cane dues. The outstanding dues of the sugarcane can be paid by the defaulting sugar mills in the next area in accordance with the government order dated 02.11.2017.
The petition has been opposed by the State of U.P. by filing counter affidavit for two reasons that the petitioner is a defaulter and that it had also failed to submit the statement of the quantity of the sugarcane required by it to the Cane Commissioner for the crushing season 2019-20.
Sri Ravindra Singh, learned counsel appearing for the respondents No. 6 to 12 has also opposed the writ petition on similar grounds by filing a separate counter affidavit. He further contends that the petitioner has an alternative remedy of filing an appeal to the State Government against the order of the Cane Commissioner reserving/assigning any area for the purposes of supply of sugarcane to a sugar mills.
The petitioner has filed rejoinder affidavits to the above counter affidavits contending that the appeal does not lie in the present case as there is no order of reservation/assignment of any area for the supply of the cane to the aforesaid sugar mill. The provision of appeal would only apply when there is such an order and a person is aggrieved by it.
It is further submitted that there was no occasion for the petitioner sugar mill to submit any statement as no notice as contemplated by Section 12 of the Act was given and reserved upon the petitioner.
In order to consider the aforesaid rival claims of the parties it would be relevant to mention that the supply and purchase of sugarcane for the use in sugar factories/mills is controlled and governed by the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953.(hereinafter referred to as the Act). Under the scheme of the said Act the Cane Commissioner is required to reserve/assign area to every sugar mill for the purposes of supply of cane for the crushing seasons and that the cane growers of that area have to supply sugarcane to the sugar mills through the Cane Growers Cooperative Societies.
Chapter III of the aforesaid Act deals with the supply and purchase of the sugarcane. Sections 12 and 15 of the aforesaid Act are relevant for our purpose which are being reproduced herein-below:-
"12. Estimates of requirements. - (1) The Cane Commissioner, may for purposes of Section 15, by order, require the occupier of any factory to furnish in the manner and by the date specified in the order to the Cane Commissioner an estimate of the quantity of cane which will be required by the factory during such crushing seasons or crushing seasons as may be specified in the order.
(2) The Cane Commissioner shall examine every such estimate and shall publish the same with such modifications, if, any, as he may make.
(3) An estimate under sub-section (2) may be revised by an authority to be prescribed.
15. Declaration of reserved area and assigned area. - (1) Without prejudice to any order made under Clause (d) of sub-section (2) of Section 16 the Cane Commissioner may, after consulting the Factory and Cane-growers' Co- operative Society in the manner to be prescribed:
(a) reserve any area (hereinafter called the reserved area); and
(b) assign any area (hereinafter called an assigned area), for the purposes of the supply of cane to a factory in accordance with the provisions of Section 16 during one or more crushing seasons as may be specified and may likewise at any time cancel such order or alter the boundaries of an area so reserved or assigned.
(2) Where any area has been declared as reserved area for a factory, the occupier of such factory shall, if so directed by the Cane Commissioner, purchase all the cane grown in that area, which is offered for sale to the factory.
(3) Where any area has been declared as assigned area for a factory, the occupier of such factory shall purchase such quantity of cane grown in that area and offered for sale to the factory as may be determined by the Cane Commissioner.
(4) An appeal shall lie to the State Government against the order of the Cane Commissioner passed under sub-section (1)."
Section 12 of the Act obliges every sugar mill to furnish by specified date the estimate of the quantity of the sugarcane required by it during the crushing seasons on the asking of the Cane Commissioner.
The Cane Commissioner after necessary examination of the estimates finalise it and publishes it whereupon the areas are assigned to the sugar mills under Section 15 of the Act.
According to the Section 15 of the Act where any area is reserved or assigned to any sugar mill the said mill is required to purchase all the sugarcane grown in that area and i.e. offered for sale to it.
There is no dispute to the fact that the Cane Commissioner for the crushing season 2019-20 after requiring all the sugar mills to submit their estimates of the quantity of the sugarcane required had passed an order of reservation/assignment of the sugarcane areas to each of the sugar mill except for the petitioner sugar mill. Accordingly, the petitioner sugar mill has been left out from the allotment of the sugarcane area for the crushing season 2019-20.
The petitioner submits that the Cane Commissioner had not required it to furnish any statement as no notice in this regard was served upon it.
The respondents have brought on record the copy of the office order dated 13.08.2019 issued by the Cane Commissioner U.P. under Section 12(1) of the Act requiring all the sugar mills to supply their estimates of quantity for the crushing season 2019-20.
It is stated the aforesaid order was sent to each of the sugar mills through email and all of them submitted their estimates except the petitioner. The Cane Commissioner after examining the estimates of each one of them finalised the areas. No area could be reserved or assigned to the petitioner as it failed to submit any estimate.
Sri Nigam, has made an effort to submit that no such email was received by the petitioner sugar mill and that a notice for the supply of the estimates was issued to some of the sugar mills otherwise than by email but the petitioner was left out.
There is no specific mode provided under the Act or the Rules in which an order would be served upon the occupiers of the sugar mill to furnish their estimates of the quantity of sugarcane required for the crushing seasons.
In the absence of any specific mode of service of the order contemplated under Section 12 of the Act, the service of the same by email cannot be held to be illegal. It is one of the fastest mode of service in the present days which is acquiring all round acceptability.
The respondents in the counter affidavit have clearly stated that the aforesaid order requiring estimate from the sugar mills was sent through email to all the sugar mills requiring them to submit their estimates in the required form by 20th August, 2019.
All the sugar mills submitted their estimates except the petitioner.
The mere denial of the service of such an email by the petitioner does not inspire confidence when similar emails were duly served upon the other sugar mills.
The petitioner had not run the sugar mill in the last crushing season 2018-19.
It was therefore, but natural to presume that the petitioner was still not ready to run it until and unless there was any specific information that it contemplates to run the mill in the present crushing seasons.
In view of the aforesaid facts and circumstances, as the petitioner failed to submit its estimate of requirement of the quantity of sugarcane needed for the crushing season 2019-20, the Cane Commissioner committed no error or illegality in not reserving/assigning any area for the supply of sugarcane to it.
This apart the other reason which has come on record for not allotting any area to the petitioner sugar mill is non-clearance of the sugarcane dues of the past years.
In this regard Rule 22 of the Rules framed under the Act is relevant which provides that in reserving or assigning the area to any sugar mill or determining the quantity of cane to be purchased by any mill, the cane Commissioner shall take into consideration apart from the other things, the arrangements made by the factory in previous years for the payment of not only cess and commission but also the cane price.
The relevant part of the aforesaid Rule reads as under:-
"In reserving an area for or assigning an area to a factory or determining the quantity of cane to be purchased from an area by a factory, under Section 15, the Cane Commissioner may take into consideration-
(a) the distance of the area from the factory,
(b) facilities for transport of cane from the area,
(c) the quantity of cane supplied from the area to the factory in previous year,
(d) previous reservation and assignment orders,
(e) the quantity of cane to be crushed in facotry,
(f) the arrangements made by the factory in previous years for payment of cess, cane price and commission,
(g) the views of the Cane-growers' Co-operative Society of the area,
(h) efforts made by the factory in developing in reserved or assigned area."
In view of the aforesaid Rule the arrangement made by the petitioner for the payment of cane price in the past years is a material and relevant consideration for the allotment of sugarcane area to it.
Learned counsel for the petitioner does not dispute that the petitioner had not cleared the complete dues of the cane price of the last year or of some previous years.
In Simbholi Sugars Ltd. Vs. State of U.P. and others 2010(3) ADJ 628 (LB) it has been observed that it shall be obligatory on part of the Cane Commissioner and the government not to allot or reserve or assign any new purchase centre and also to continue with the old one of any sugar mills against the whom cane price are outstanding.
The argument that the petitioner has been discriminated as some of the defaulting sugar mills have been allotted sugar canes areas is of no substance. First, the petitioner cannot claim equality with any illegality. Secondly, petitioner is not aggrieved by the allotment of area to such other sugar mills and has not put any challenge to any such illegal allotment.
The petitioner is not entitle to any benefit of the government order dated 02.11.2017 inasmuch as it relates only to the clearance of the dues of the last crushing season.
In addition to the above, Section 15(4) of the Act clearly provides that an appeal shall lie to the State Government against the order of the Cane Commissioner passed under Sub-Section (1) of Section 15 of the Act.
Sub-Section (1) of Section 15 of the Act pertains to the order of the Cane Commissioner reserving any area/assigning any area for the purpose of supply of cane to a factory during a particular crushing season. Non-reservation of an area for any reason amounts to implied refusal of allotment to the sugar mill and as such the order of allotment of sugarcane area to other sugar mills leaving aside the petitioner sugar mill is an order which would fall in the same category and would be appealable under Section 15(4) of the Act but the petitioner chose not avail the said remedy.
In view of the totality of the facts and circumstances of the case, we do not feel incline or deem it necessary to exercise our discretionary jurisdiction in the matter.
The writ petition is accordingly dismissed with no order as to costs.
Order Date :- 17.12.2019/piyush