K. N. Seth, J. - (1.) THIS appeal is direct ed against an order of a learned Single ludge of this Court issuing a direction to the Cen tral Government to re-fix the price of the sugarcane supplied to the petitioner's factory during the 1970-71 crushing season in the light of the observations made in the im pugned judgment. It was also directed that if on reification of the price the petitioner was entitled to a refund of any portion of the amount deposited in pursuance of the interim order of this Court, it shall be re funded to the petitioner on a certificate of the Cane Commissioner, but in case the petitioner was required to pay further sum, that would be payable to the sellers of the sugarcane according to the refined piece of the quantity supplied by them.
(2.) THE problem of fixation of price for sugarcane supplied to the sugar factories by the sugarcane growers and the price of sugar sold by the sugar factories was tried to be solved by the Government by adopting various methods from year to year. For the year 1970-71 by a notification dated 12th November 1970 (hereinafter referred to as the Notification) the Central Government, in exercise of the powers conferred by clause (3) of the Sugarcane (Control) Order, 1966, made under the Essential Commodities Act, 1955, fixed the minimum price payable by the owners of the vacuum pan sugar fac tories all over India for the sugarcane sup plied to them during the aforesaid period. The minimum sugarcane price payable by the various sugar factories were set out in the Schedule to the Notification. Under the Sche dule the Neoli Sugar Factory, owned by the petitioner Messrs. Shervani Sugar Syndicate (Private) Limited, was required to pay Rs. 7.57 per quintal. The principles on which the prices in the Schedule were fixed for the various factories were set out in a Circular letter of the same date, issued to all the sugar factories in India, as follows:- "The minimum prices have been fixed on the basis of a basic minimum price of Rs. 7.37 per quintal linked to a recovery of 9.4 per cent or below, with a premium of 6.6 paise instead of 5.36 paise per quintal, as in the preceding year, for every 0.1 per cent increase in recovery above 9.4 percent." The petitioner challenged the validity of the Notification principally on the ground that the minimum prices fixed by the Notification on the principle laid down in the Circular Letter was in contravention of clause (3) of the Sugarcane (Control) Order, 1966. It was contended that the Central Government had not taken into consideration the price at which the sugar produced by the factories was sold by the producer and had exaggerat ed the price of the sugarcane supplied, to the petitioner's factory. At this stage it may be noted that the method of supply of sugarcane to the sugar factories was regulated by the U. P. Sugarcane (Regulation of Supply and Pur chase) Act, 1953 (U. P. Act XXIV of 1953). Under the aforesaid Act a sugar factory was required to furnish an estimate of the quan tity of cane which would be required by the factory to the Cane Commissioner appointed under that Act. The Cane Commissioner, on receiving the estimate, reserves or assigns an area of sugarcane in consultation with the factory and the Cane Growers' Co-ope rative Society and the factory is expected to purchase all the cane grown and offered in this area. The normal crushing season for sugarcane extends from November to April but due to abundance of growth of sugarcan, the crushing season extended even to July.
(3.) THE Essential Commodities Act, 1V55 empowers the Central Government to control production, supply, distribution etc., of essential commodities. Under Section 3-C of the Act the Central Government is em powered to fix the price of sugar. Clause (3) of the 'Sugarcane (Control) Order, 1966, au thorises the Central Government to fix the price of sugarcane and runs as follows:- "(3) (i) The Central Government may, after consultation with such authorities, bodies or associations at it may deem fit, by time to time, fix the minimum price of sugercane to be paid by producers of sugar or their agents for the sugarcane purchased by them, having regard to- (a) the cost of production of sugarcane; (b) the return to the grower from alter native crops and the general trend of prices of agricultural commodities; (c) the availability of tugar to the con-tmmer at a fair price; (d) the price at which sugar produced from sugarcane is sold by producers of sugar; and (e) the recovery of tagar from sugar- Provided that the Ctntral Government or with the approval of the Central Govern ment the State Government may, in such aircumstances and subject to such condi tions as it may specify allow a suitable re-bat in the price so fixed. Explanation - Different prices may baixed for different areas Or different qualities or varieties of sugarcane." ;