BHOPAL SUGAR INDUSTRIES LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THE Bhopal Sugar Industries Ltd. , IN petitioner No. 1 in this petition, is a public limited company which owns a sugar factory at Sehore. Petitioner No. 2 is a share-holder of the company. By this petition under Article 226 of the Constitution the petitioners pray for quashing of the Sugar (Price Determination for 1980-81 Production) Order, 1980, in so far as it relates to Madhya Pradesh Zone.

(2.) THE price fixed by the impugned Order was for levy sugar and was different for different zones. By levy sugar is meant the sugar requisitioned under the Levy Sugar Supply (Control) Order 1979. For Madhya Pradesh zone, the price of D-30 grade of sugar for delivery into railway wagons in respect of factories specified in Schedule V of the Order was Rs. 344-97 per quintal. The price fixed for factories specified in Schedule VI for the same grade of sugar was Rs. 369. 41 per quintal. The prices for other grades of sugar were also similarly fixed with slight variations. The petitioners' factory is in Schedule V. The sugar year 1980-81 commenced from 1st Oct. 1980 and ended on 30th Sept. 1981. The impugned order was issued under Section 3 (3-C) of the Essential Commodities Act, 1955.

(3.) IN fixing the price of levy sugar under Section 3 (3-C) of the Act, the Central Government must have regard to (a) the minimum price fixed for sugarcane, (b) the manufacturing cost of sugar, (c) the duly or tax paid or payable thereon, and (d) the securing of a reasonable return on the capital employed in the business of manufacturing sugar. The minimum price payable by a producer of sugar for sugarcane is controlled by the Government under the Sugarcane (Control) Order, 1966. The price of levy sugar is fixed on zonal system as recommended by the various commissions, which were constituted for preparing costs schedules to enable the Government to fix the price of levy sugar.