PARTABPORE COMPANYLTD Vs. CANE COMMISSIONER

JUDGEMENT

(1.) The petitioner is a company owning a sugar factory at Rampur, police station Ban-kata, district Deoria of Uttar Pradesh, known as Purtabpore Sugar Factory. The factory is located at a distance of about hundred yards from the Uttar Pradesh-Bihar border, and the district of Saran of the State of Bihar is adjacent east of the factory. The nearest railway station for the factory is Mairwa Railway Station of the North-Eastern Railway situated in the State of Bihar, from where there is a private light railway connecting with the factory. From the map filed by the parties, it is clear that the boundary of the district of Saran practically encircles the sugar factory on the southern, eastern and northern sides. On account of this peculiar geographical situation, the factory is dependent (partly, at any rate) for its supply of sugar-cane on some of the villages of Saran District adjacent to it. Since 1938, a compact block of 208 villages, forming a belt four miles wide and nine miles long, in Saran District, very close to the factory, was reserved for the supply of sugar-cane under the Bihar Sugar Factories (Control) Act, 1937. The petitioner has claimed that it used to advance large sums of money to cultivators of sugar-cane in the said villages, that various development activities in the villages were also performed by the petitioner after investing large sums of money, that prices for the sugar-cane supplied were also promptly paid, and that the sugar-cane growers of that area were very much satisfied with the treatment given to them by the petitioner. With a view to secure equitable distribution of sugar cane to those factories situated close to the border between the State of Bihar and Uttar Pradesh and also to create a forum for discussion of matters of mutual interest, a joint Sugar cane Board for Uttar Pradesh and Bihar was constituted, consisting of representatives of both the States. On or about the 3rd February, 1964, the Cane Commissioners of Uttar Pradesh and Bihar entered into an agreement to the effect that the said 208 villages would continue to be reserved for the petitioner's factory from 1964-65 (see Annexure B). Some of the sugar factories located in the State of Bihar, including the factory of respondent No. 5 (known as the New Savan Sugar Factory) were dependent for their supply of sugarcane on the cane-growing areas...in the district of Champaran, adjacent north of Saran and bordering on Uttar Pradesh; but, for the convenient transport of sugar-cane from Dhanbad area of Champaran to the factories in the district of Saran, there were two centres at the railway stations of Dudhai and Taraiya-Sujan which were both located in Deoria district of Uttar Pradesh. Hence, by way of reciprocal arrangement, the Uttar Pradesh authorities permitted these two centres to be operated exclusively by the Bihar factories, and also exempted the sugar-cane transported through those centres from payment of purchase tax in Uttar Pradesh. Thus, the agreement of 1964 between the two Cane Commissioners was on a reciprocal basis for mutual advantage of the factories situated in the bordering areas of Uttar Pradesh and Bihar. In pursuance of this agreement, in 1964-65 and 1965-66 also, the said 208 villages were reserved for the petitioner's factory; but respondent No. 5 wanted an altercation in the said reservation, and made a representation on the 17th February, 1966, which was, however, rejected.

(2.) In the meantime, on the 16th July, 1966, the Central Government made the well-known Sugar-Cane (Control) Order, 1966 (hereinafter referred to as the Order), in exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955. Clause 6 of the Order conferred power on the Central Government to regulate distribution and movement of sugar-cane. The material paragraphs of that clause for our purpose are paragraphs (a), (b) and (c) of sub-clause (1) which are as follows:

(3.) Respondent No. 5 then filed a writ petition before this Court in Civil Writ Jurisdiction Case No. 63 of 1967, challenging the validity of that Order. That writ petition was ultimately with-drawn by respondent No. 5 on the 10th November, 1967, on the ground that, after considering the representations of the parties, the Cane Commissioner decided to reserve 99 villages for the factory of respondent No. 5 and the remaining 109 villages for the petitioner's factory. On the 14th November, 1967, the Cane Commissioner, Bihar, issued two orders (enclosures to Annexures G and H), by which, after superseding his own order, dated the 30th December, 1966, he reserved only 109 out of the said 208 villages for the petitioner's factory, and reserved the remaining 99 villages for the factory of respondent No. 5. As the validity of these two orders hereinafter referred to as the impugned orders) is under challenge, they may be quoted, excluding the list of villages :