Lucknow, Jul 23 The Lucknow bench of Allahabad High Court has summoned the Uttar Pradesh cane commissioner on August 3 to explain the delay in payment of sugarcane dues and the non-payment of statutory interest to cane growers across the state.
The order was passed by a bench of Justices Rajan Roy and Manjive Shukla on July 16 and uploaded on Thursday while hearing a public interest litigation (PIL) filed in 2006 by V M Singh, convenor of Kisan Mazdoor Sangathan.
The court earlier observed that despite its specific directions, the state government had failed to place complete and accurate data on record.
It said that the interpretation and implementation of the law should not be tilted only in favour of sugar mills, but must equally protect the rights of cane growers.
The PIL seeks payment of statutory interest on delayed sugarcane dues to cane growers from the crushing season 1996-97 onwards.
Hearing the PIL, the bench said it is the statutory duty of the cane commissioner to ensure that cane growers receive payment within the prescribed time.
The court observed that its primary concern is to ascertain whether the cane commissioner discharged his legal obligation in accordance with the law.
It further noted that if interest on delayed payments has not been paid to cane growers since 1996, the amount involved could run into hundreds, or even thousands of crores of rupees. In such a situation, it would also have to be examined as to who was responsible for the failure to enforce the statutory provisions.
The court said that by its order of May 1, 2024, it had directed the state to furnish year-wise data from 1996-97 onwards, including details of timely payments, delayed payments, and the interest imposed and actually paid on such delayed payments. However, the affidavit filed by the state did not directly answer the queries raised by the court and, prima facie, appeared to be an attempt to avoid giving specific responses.
The bench also referred to its judgment of December 23, 2021, wherein it had held that sugar mills are legally bound to make payment for sugarcane within 14 days and any payment made beyond that period would attract interest at the rate of 15 per cent per annum.
The court observed that the special leave petition (SLP) against the judgment had already been dismissed by the Supreme Court, and therefore, the decision had attained finality so far as the state government is concerned.
During the hearing, the high court observed that if statutory interest on delayed payments has not been paid to cane growers since 1996, the liability could amount to hundreds or even thousands of crores of rupees.
It said that merely arguing that payment of such interest would force sugar mills to shut down cannot be accepted, as the interests of poor cane growers deserve equal protection under the law.
The bench directed that the issue would be examined in three phases -- ?1996 to 2006, 2007 to 2013, and 2014 to 2025-26.
It also directed the cane commissioner to explain in the next hearing whether, after the court's 2021 judgment, recovery certificates issued under the law had imposed interest at the rate of 15 per cent per annum on delayed payments.
In the course of hearing, UP Sugar Mills Association argued that if mills were directed to pay the entire interest on delayed cane dues, they would face an additional financial burden running into thousands of crores of rupees and several sugar mills might be forced to close.
Responding to the mills' submission, the bench observed, "Then what about the interest of the poor cane growers who also contribute to the economy of this country, why the law should be heavily laden or interpreted and implemented in a manner which favours only the sugar mills and not the cane growers."
