KASTURILAL HARKESH KUMAR Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners in these petitions and in several others in which rule nisi has not been issued are recognised/ licensed sugar dealers who have challenged the viras and validity of an order issued on 17th December, 1979 and called the Sugar (Retention and Sale by Recognised Dealers) Order, 1979. The impugned order comes in the series of orders issued with a view to ensure availability of sugar at fair prices and the history of such orders may briefly be recalled.

(2.) In Panipat Cooperative Sugar Mills etc. v. Union of India, A.I.R. 1973 SC 537(1), the Supreme Court noted that so far as sugar is concerned, statutory control over it was first imposed in 1942 under the Sugar and Sugar Products Control Order, 1942. The Sugar Controller thereunder regulated production, distribution and prices of sugar. From May 1, 1942 no sugar factory was permitted to effect sales except to authorised persons. This position continued until December 8, 1947, when sugar was decontrolled. In 1949, statutory control was once more imposed under which ex-factory price of Rs. 76.35 per quintal for D-24 grade was fixed, as during that year sugar production declined. There was also a substantial diversion of cane to gur and khandsari industry. Control over sugar was relaxed in 1950 in that production over 90 per cent of the total production of each factory was allowed free sale. This policy was subsequently modified and 95 per cent of the average production of each factory during the two preceding years was fixed as basic quota and half of the production in excess of that quota was allowed free sale, while the other half together with the basic quota was reserved for sale at controlled prices. Since conditions appeared to improve, control was taken off in 1952-1953, except that a small portion of production was reserved for sale at controlled prices. But as prices spiralled, Government in April 1954 requisitioned 25 per cent of the stock for distribution on a tender basis. During 1954-55 to 1956-57 no controlled prices were fixed. By 1958 the prices began to soar and the Government once more decided to impose control.

(3.) Sugar continued to be subject of control in the years that followed. But the year 1966-67 turned out to be the worst year in the decade owing to draught. Production of cane fell by 22 per cent and that of sugar by 40 per cent as compared to 1965-66. It was felt that the outlook for 1967-68 would be gloomier still as a further fall in the area under cane plantation would be by about II per cent.