Sugar:
Sugar Company – Placed in central zone of State of Uttar Pradesh for the purpose of fixation of price for the levy sugar – For two crushing years – Company filed writ petition before High Court seeking direction to be placed in the eastern zone, seeking parity with other two units which were placed in eastern zone – Single Judge dismissed the petition – Review petition against the same, was also dismissed – Appeal to Supreme Court – Held: the company was placed in the central zone for the relevant years, after exhaustive study by the experts – Conclusions reached by the Central Government in exercise of statutory power cannot be said to be either discriminatory or unreasonable – The company cannot claim parity with other units in the district, when the revenue districts are not the limits for zonal division.
Dismissing the appeals, the Court
HELD: 1.1 The price of levy sugar is fixed for a zone with an intention to ensure to the manufacturers of the sugar in the zone, a reasonable return on their overall production and investment, provided that the units are running economically and efficiently. Sugar was a controlled commodity during the relevant time, covered by the provisions of the Essential Commodities Act, 1955. Certain quantity of sugar called levy sugar, was to be supplied to the Government at a price fixed by the Government and rest of the same was levy free sugar, which could be sold in open market. The price of levy sugar was fixed based on the Control Order framed under the Essential Commodities Act. The price of levy sugar was fixed by the Central Government, having regard to various factors, including the basis of basic–cost schedules drawn and recommended by the expert body. [Para 7][623-A-D]
1.2 The impugned Orders questioned in the writ petition were based on exhaustive study by experts. The conclusions reached by the Central Government in exercise of statutory power cannot be said to be either discriminatory or unreasonable. So far as sugar units, with which the appellant had claimed parity, are concerned, they were transferred to eastern zone on the basis of merits adjudged by the State. When the revenue districts are not the limits for zonal division, the appellant cannot claim parity with other units only on the ground that all the units are situated in Sitapur district. Even with regard to appellant unit, after a lapse of time, it was considered feasible to place it in eastern zone. [Para 7][623-E-H]
1.3 Merely because there is difference in price in central zone and eastern zone, the appellant cannot claim, as a matter of right, its unit was to be placed in eastern zone instead of central zone during the relevant years. [Para7][623-E-F]
1.4 As the appellant has failed to demonstrate any invidious discrimination and statutory violation, merely on the ground that other units in Sitapur district were transferred to eastern zone and that the representation of the appellant was not acceded to for the relevant crushing years, is no ground for interference. [Para 7][623-H; 624-A]
1.5 The action of the Central Government in placing the factory of the appellant at two different times in two different zones also does not constitute any discrimination. The policy decision was taken from time to time subject to satisfaction of the Government by taking into account expert reports. [Para 7][624B-C]
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.