SC upholds States' power to fix cane prices
By Our Corporate Bureau | 06 May 2004
New Delhi: The Supreme Court has upheld the right of State Governments to fix or `advice' cane prices over and above the Statutory Minimum Price (SMP) declared by the Centre.
A five-judge constitution bench, comprising the chief justice S. Rajendra Babu, K.G. Balakrishnan, PV Reddy, B.N. Srikrishna and G.P. Mathur, yesterday allowed the Special Leave Petitions filed by the Uttar Pradesh Government challenging an interim order of the Allahabad High Court on December 11, 1996.
The Allahabad Hifh Court order, delivered by a bench under M. Katju, had ruled that State Governments had no right to fix State Adviced Prices (SAP) for sugarcane to be payable by mills to growers.
Yesterday’s Supreme Court ruling — by a 3:2 majority — essentially reverses the earlier Allahabad High Court Bench order of 1996. Justices Babu, Balakrishnan and Mathur ruled that State Governments could provide for SAPs over and above the SMP notified by the Centre under the Sugarcane Control Order, 1996. Justices Reddy and Srikrishna, however, held that mills could not be coerced to pay the higher `adviced' price as there was no statutory backing for it. Srikrishna noted that the UP Sugarcane Act, 1953 did not contain any provision for the State Government to fix the SAP for cane supplied by growers to sugar mills.