GANESH SUGAR WORKS Vs. STATE OF HARYANA

JUDGEMENT

(1.) The fifteen appellants are owners of khandasari anits in the State of Haryana. There are seventy-twokhandasari units in Haryana, out of which fifty-four are located within areas reserved for sugar mills under the Sugarcane Control Order. The units of the appellants are among these fifty-four. All the appellants' units were previously licensed under the Haryana Khandasari Sugar Manufacturers' Licensing Order. When they applied for renewal of their licenses, their applications were rejected by the Cane Commissioner on the ground that there was 'acute shortage of cane in the assigned area of the sugar mills'. Sub-clause (3) (c) of Clause 3 of the Haryana Khandasari Manufakturers' Licensing Order was quoted in (support of the orders. These orders were destined by the appellants before (the High court of Punjab and Haryana under Article 226 of the Constitution. A learned Single Judge of the High court allowed the Writ Petition and directed the renewal of the licenses of the appellants. On an appeal preferred by the State of Haryana and the Cane Commissioner under the Letters Patent, a division bench of the High court reversed the judgment of the learned Single Judge and dismissed the writ petition. This appeal has been filed by the aggrieved owners of khandasari units, who claim that their applications for renewal had been improperly rejected. The principal submission of Shri R. K. Jain, learned counsel for the appellants was that their applications could have been rejected on the ground of the public interest but not on the sole ground of acute shortage of cane in the assigned area of sugar mill. He submitted that in determining the question of the public interest involved, it was necessary to take into consideration not merely the interests of the sugar mills, but also the interests of the khandasari units, the interests of the growers of sugarcane, the interests of the consumers, the interests of the trade, the interests of the workers, the effect on the economy of the country, etc. None of these factors appeared to have been considered. He suggested that the court might appoint a Commission to make a deep study of the question and submit a report on the need and the extent of the restriction to be imposed on khandasari units. For the reasons which we shall presently give, we do not think we can accept the submission of Shri Jain or accede to his request.

(2.) The Sugarcane (Control) Order, 1966 was made by the central government in exercise of its powers under S. 3 of the Essential Commodities Act. 'factory' is defined by Clause 2 (c) to mean "any premises including the precincts thereof in any part of which sugar is manufactured by vacuum pan process". 'khandasari unit' is defined by Clause 2 (e) to mean "a unit engaged or ordinarily engaged in the manufacture of khandasari sugar from sugarcane juice or ram". 'khandasari sugar' is defined to mean "sugar produced by open pan process". 'producer of khandasari sugar' is defined to mean "a person carrying on business of sugar manufacture by open pan process". 'producer of sugar' is defined to mean "a person carrying on business of manufacturing sugar by vacuum pan process". 'reserved area' is denied to mean "any area where sugarcane is grown and reserved for a factory under sub-clause (1) (a) of Clause 6". Clause 3 of the Control Order deals with minimum price of sugarcane payable by producer of sugar, that is, by a person manufacturing sugar by vacuum pan process. Clause 4 deals with minimum price of sugarcane payable by producers of khandasari sugar, that is, by persons manufacturing sugar by open pan process. Clause 6 deals with power to regular distribution and movement of sugarcane. Sub-clause (l) (a) of Clause 6 enables the central government to reserve any area where sugarcane is grown for a factory having regard to the crushing capacity of the factory, the availability of sugarcane in the reserved area and the need for production of sugar, with a view to enabling the factory to purchase the quantity of sugarcane required by it. Clause 6 (l) (e) enables the central government to direct by. order that no gum or khandasari sugar or sugar shall be manufactured from sugarcane except under and in accordance with the conditions specified in the licence issued in this behalf. Clause 6 (l) (f) enables the central government to prohibit or restrict or otherwise regulate the export of sugarcane from any area (including a reserved area) except under and in accordance with a permit issued in this behalf. Clause 7 (b) (ii) authorises the central government to direct that in a reserved area, no sugarcane or sugarcane Juice shall be purchased for crushing or for manufacture of gum, shaker, Jul, jugglery, rag or khandasari sugar, as the case may be, by a crusher not belonging to a grower or a body of growers of sugarcane or by a khandasari unit in the area except under and in accordance with a permit issued by the central government in that behalf. Clause 8 of the Control Order further enables the central government to, "by general or special order, issue directions to any producer of khandasari sugar or owner of a power crusher, khandasari unit or crusher or the agent of such producer or owner of a co-operative society, regarding the purchase of sugarcane or sugarcane juice, production, maintenance of stocks, storage, price, packing, payment, disposal, delivery and distribution of sugarcane, gur, gul, jugglery and rab or khandasari sugar or the period or hours to be worked".

(3.) In exercise of the powers conferred by Clause 6 (i) (e) of the Sugarcane Control Order read with Notification No. GSR-1127/ E. S. S. COM/sugarcane dated 16/07/1966, the government of Haryana made the Haryana Khandasari Sugar Manufacturers' Licensing Order. 1972. Clause 3 of this Order deals with grant of licences. Sub-clauses (3) and (4) of Clause 3 are as follows: