WEST U P SUGAR MILLS ASSN Vs. STATE OF UTTAR PRADESH
LAWS(SC)-2002-2-114
SUPREME COURT OF INDIA (FROM: ALLAHABAD)
Decided on February 07,2002

WEST U.P.SUGAR MILLS ASSOCIATION Appellant
VERSUS
STATE OF UTTAR PRADESH Respondents





Cited Judgements :-

NAROTE AMOL SADASHIVRAO VS. STATE OF MAHARASHTRA [LAWS(BOM)-2014-3-91] [REFERRED TO]
DOOSAN INFRACORE INDIA PRIVATE LIMITED VS. ASSISTANT COMMISSIONER, OFFICE OF THE COMMISSIONER OF GST AND CENTRAL EXCISE [LAWS(MAD)-2020-8-7] [REFERRED TO]
STATE OF MADHYA PRADESH VS. PERNOD RICARD INDIA [LAWS(MPH)-2017-6-27] [REFERRED TO]
JOINT ACTION COMMITTEE OF AIRLINES PILOTS ASSOCIATIONS OF INDIA VS. DIRECTOR GENERAL OF CIVIL AVIATION [LAWS(SC)-2011-5-23] [RFERRED TO]
STATE OF U.P. AND ORS. VS. HIRENDRA PAL SINGH ETC. [LAWS(SC)-2010-12-90] [REFERRED TO]
PRAKASH AND ORS. VS. PHULAVATI AND ORS. [LAWS(SC)-2015-10-81] [REFERRED TO]
INDIA GLYCOLS LIMITED VS. STATE OF UTTARAKHAND [LAWS(UTN)-2012-1-21] [REFERRED TO]
HIGH COURT OF KARNATAKA VS. S.M. SHIVABEERAIAH [LAWS(KAR)-2020-3-93] [REFERRED TO]
K. K. POOVAIAH VS. STATE OF KARNATAKA [LAWS(KAR)-2021-3-159] [REFERRED TO]
THE DIRECTOR OF INCOME TAX, INTERNATIONAL TAXATION AND ORS. VS. AUTODESK ASIA PVT. LTD. [LAWS(KAR)-2020-9-677] [REFERRED TO]
DIPLOMA ENGINEERS SANGH VS. STATE OF U P [LAWS(SC)-2007-3-128] [REFERRED TO]
STATE OF TAMIL NADU VS. K SHYAM SUNDER [LAWS(SC)-2011-8-37] [REFERRED TO]
INCOME TAX OFFICER VS. VIKRAM SUJITKUMAR BHATIA [LAWS(SC)-2023-4-3] [REFERRED TO]
TEACHERS ASSOCIATION OF BERHAMPUR UNIVERSITY VS. STATE OF ORISSA [LAWS(ORI)-2014-3-16] [REFERRED TO]
BHAKTI VS. STATE OF MAHARASHTRA [LAWS(BOM)-2018-3-46] [REFERRED TO]
PERNOD RICARD INDIA PVT LTD VS. STATE OF M.P. [LAWS(MPH)-2015-12-63] [REFERRED TO]
SAKTHI MASALA (P) LTD. VS. ASSISTANT COMMISSIONER [LAWS(MAD)-2013-4-143] [REFERRED TO]
ARUVENDRA KUMAR GARG VS. STATE OF U P [LAWS(ALL)-2002-3-98] [REFERRED TO]
MADHU KODA VS. STATE [LAWS(DLH)-2020-5-72] [REFERRED TO]
ZILE SINGH VS. STATE OF HARYANA [LAWS(SC)-2004-10-57] [REFERRED TO]
STATE OF U P VS. HIRENDRA PAL SINGH [LAWS(SC)-2010-12-6] [REFERRED TO]
STATE OF KERALA VS. PEOPLES UNION FOR CIVIL LIBERTIES [LAWS(SC)-2009-7-7] [REFERRED TO]
UT OF J&K VS. MIRSONS CONSTRUCTIONS PVT. LTD. [LAWS(J&K)-2022-10-4] [REFERRED TO]
VILAS SHANKARRAO DESHPANDE VS. GOVERNMENT OF MAHARASHTRA [LAWS(BOM)-2022-12-124] [REFERRED TO]
MOHD. NIJAMUDDIN VS. STATE OF U.P. [LAWS(ALL)-2021-9-32] [REFERRED TO]
NEPC MICON LIMITED VS. SASHI PRAKASH KHEMKA [LAWS(MAD)-2006-10-205] [REFERRED TO]
NIHARIKA JAIN VS. UNION OF INDIA [LAWS(RAJ)-2019-7-352] [REFERRED TO]
SUPREME COURT ADVOCATE-ON-RECORD ASSOCIATION VS. UNION OF INDIA [LAWS(SC)-2015-10-80] [REFERRED TO]
NAZARETH FOODS (P) LTD. VS. ASSISTANT COMMISSIONER [LAWS(MAD)-2013-4-145] [REFERRED TO]
LAKSHMI METALLICA PVT. LTD. VS. STATE OF ANDHRA PRADESH [LAWS(APH)-2017-11-93] [REFERRED TO]
DIRECTOR OF HEALTH A P HYDERABAD VS. P VEERABHADRA RAO [LAWS(APH)-2008-7-25] [REFERRED TO]
SADHANA SHARMA VS. STATE OF U P [LAWS(ALL)-2012-1-59] [REFERRED TO]
ASISH TARU GHOSH VS. STATE OF WEST BENGAL [LAWS(CAL)-2005-3-85] [REFERRED TO]
SHRI SANGLAKPAM NANDABABU SHARMA VS. THE STATE OF MANIPUR [LAWS(MANIP)-2016-10-8] [REFERRED TO]
AFTAB AHMAD KAKROO AND ANOTHER VS. STATE OF J&K AND OTHERS [LAWS(J&K)-2017-2-55] [REFERRED TO]
PROF. (DR.) KHURSHID IQBAL ANDRABI VS. STATE OF J&K & ORS. [LAWS(J&K)-2018-2-38] [REFERRED TO]
SHIV KUMAR PATHAK AND ORS. VS. STATE OF U.P. AND ORS. [LAWS(ALL)-2015-8-71] [REFERRED TO]
G SUNDARRAJAN VS. UNION OF INDIA [LAWS(MAD)-2012-8-181] [REFERRED TO]
NEPC MICON LIMITED VS. SASHI PRAKASH KHEMKA [LAWS(MAD)-2006-10-204] [REFERRED TO]
VODAFONE SOUTH LIMITED VS. STATE OF U P [LAWS(ALL)-2016-8-232] [REFERRED]
ANITA GANDHI VS. NIDESHAK RAJYA SHAIKSHIK [LAWS(ALL)-2012-7-225] [REFERRED TO]
RAJESH GUPTA VS. STATE OF U.P. AND OTHERS [LAWS(ALL)-2009-8-324] [REFERRED TO]


JUDGEMENT

V. N. KHARE, J. - (1.)APPELLANT Nos. 4 to 22 before us are the companies incorporated under the Indian Companies Act and are engaged in the business of production and sale of sugar. These appellants own sugar factories (hereinafter referred to as 'sugar factories') which are located in various parts of the State of Uttar Pradesh. One of the raw materials required for production of sugar is sugarcane which is purchased from sugarcane growers through sugarcane co-operative societies - which are the respondents in these matters. The purchase of sugarcane by the sugar factories is regulated under the provisions of U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 (hereinafter referred to as the Act). In exercise of power conferred under Section 28 of the Act, the State Government has framed rules known as the U.P. Sugarcane (Regulation of Supply and Purchase) Rules, 1954 (hereinafter referred to as the Rules). Section 18 of the Act requires the sugar factories to pay a commission known as society commission to the co-operative cane societies a share of which is also transferred to the Cane Development Council. The rate at which the said commission is payable is left to be determined and prescribed by the State Government by the statutory Rules. The share of commission which comes to the co-operative societies is to cover their administrative costs, which include mainly the maintenance of staff deputed for undertaking various co-operatives activities connected with the sale of sugarcane to the sugar factories.
(2.)IN the year 1985, the Government of Uttar Pradesh by amending Rule 49 of the Rules raised the society commission to .50 paise per quintal vide notification dated 11-7-85. Subsequently, the Government of Uttar Pradesh by a subsequent notification dated 1-6-91 again amended Rule 49 and revised the rate of society commission from the existing rate of .50 paise per quintal to 5% of the minimum statutory cane price fixed by the Central Government. After the existing rate of commission was enhanced, the appellants jointly submitted representation before the State Government, inter alia, contending that enhancement is excessive and arbitrary. Simultaneously, the appellants also filed writ petition challenging the enhancement of society commission. However, in January 1992, the writ petition was withdrawn.
It appears, the State Government on the representation of the appellants reduced the rate of society commission from 5% of the minimum statutory price of sugarcane to 2.69% of the minimum statutory price of sugarcane which worked out to .70 paise per quintal. This was done by the amendment of Rule 49 of the Rules by notification dated 24-4-92. The notification dated 24-4-92 runs as under :

"1. (1) These rules may be called the Uttar Pradesh Sugarcane (Regulation of Supply and Purchase) (Amendment) Rules, 1992.

(2) They shall remain in force with effect from 1-10-91 to 30-9-92.

2. In the Uttar Pradesh Sugarcane (Regulation of Supply and Purchases) Rules, 1954, for the rules set out in column 1 below, the rules as set out in column 2 shall be substituted :-
JUDGEMENT_645_2_2002Html1.htm
The affect of the aforesaid notification was that existing Rule 49 was deleted and in its place new Rule 49 was substituted. However, the substituted rule remained operative from 1-10-91 to 30-9-92. It is not disputed that the appellants herein continued to pay the society commission on the basis of substituted Rule 49 i.e. @ 2.69% of the minimum statutory price of sugarcane. After 30-9-92, the Cane Commissioner of Uttar Pradesh issued a circular to the effect that the society commission after 30-9-92 shall be charged @ 5% of the minimum statutory price of sugarcane fixed by the Central Government on the premise that since the substituted rule came to be inoperative after 30-9-92, the old Rule 49 has revived.

(3.)SINCE the respondents insisted to charge society commission @ 5% of the minimum statutory price of sugarcane fixed by the Central Government, it is alleged that the appellants were compelled to file a writ petition before the High Court of Judicature at Allahabad. In the said writ petition, the appellants challenged the order dated 5-1-93 passed by the Cane Commissioner whereby and whereunder the Cane Commissioner issued direction to realise society commission @ 5% of the minimum statutory price of sugarcane, fixed by the Central Government.
One of the grounds of challenge of the said circular was that once the old Rule 49 having been deleted and substituted by new Rule 49 providing for 2.69% of the minimum statutory price of sugarcane even though it has ceased to be operative after 30-9-92, the old rule does not revive and the respondents have no authority in law to charge society commission @ 5% of the minimum statutory price of sugarcane. The High Court was of the view that on the application of Section 6-C of the U.P. General Clauses Act, the repealed or deleted Rule 49 revived after the substituted Rule 49 ceased to be operative. In that view of the matter, the writ petition was dismissed. It is against the said judgment and order of the High Court, the appellants have filed the present appeal by way of special leave petition and there is also a connected writ petition under Article 32 of the Constitution, challenging the impugned society commission.



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