The Supreme Court on Wednesday sought response from the Centre, a variety of state governments and sugar mills, which includes Bajaj Hindustan Sugar and Indian Sugarmills Association, on a petition looking for creation of a mechanism to make sure timely payment of dues to sugarcane producers and release of some ad hoc payments to the sugarcane growers against their outstanding dues.
A Bench led by Chief Justice NV Ramana issued notices to the Centre and 11 sugarcane developing state governments and sugar mills – Bajaj Hindustan Sugar, Indian Sugarmills Association, Cane Agro Energy (India) and Indian Sucrose – on a petition by six farmers from Maharashtra, which includes a former Parliamentarian Raju Anna Shetti, alleging that there is a vicious cycle below which sugar mills are declared sick and dues payable to farmers accumulate into thousand of crores. As per the government records, the farmers claimed, that sugar mills owe Rs 18,000 to farmers as on January 1, 2021. These 11 states – Uttar Pradesh, Maharashtra, Punjab, Uttarakhand, Haryana, Gujarat, Bihar, Telangana, Andhra Pradesh, Karnataka and Tamil Nadu – generate bulk of the sugarcane in the nation.
The petition sought path to the Centre and state governments to file affidavits setting out the specifics of the amounts due, the amounts paid and arrears by the sugar mills to the sugarcane grower or their cooperatives for sale of their cane along with interest thereon at 15% on year-sensible from 2018 to 2020.
It also posted the matter for additional hearing just after 3 weeks time.
Senior counsel Anand Grover, appearing for the petitioners, argued that at the moment the challenge is not prior to any higher court, and it will be in the ideal interest of the farmers to pass an order that will be applicable all through the nation. He urged the SC to direct the governments to release some ad hoc payments to the sugarcane growers against their outstanding dues.
While looking for a path to the government to attach sugar stocks lying with the mills and sell and distribute the proceeds to the sugarcane farmers, the petitioners alleged that non-payment of dues is a violation of Sugar (Control) Order, 1966, which stipulates that the payment to sugarcane suppliers, shall be made at the earliest inside 14 days from the date of provide. The Essential Commodities Act 1955 also envisages that a “fair and remunerative price” will have to be paid to the producers, they added.
It sought a mechanism by which the value of sugarcane production is paid to farmers as per law in order to keep away from the accumulation of such dues and to protect against farmers from vicious cycle when a sugar mill is declared sick and their dues of sugarcane generate remained unpaid.
As of April 8, 2020, the sugar mills had bought sugarcane worth Rs 28,000 crore, but paid only Rs 15,430 crore, they added.
The petition stated that as per the information accessed by FE as on August 21, 2020, 119 sugar mills have just paid 70% of their 2019-20 cane dues to farmers and about Rs 11,000 crore dues are pending. Some of the private mills have paid much less than 50% and are the usual defaulters, it added. While the Simbhaoli group has paid 24% and owes Rs 590 crore, the Modi group has paid 27% of dues and has Rs 568 crore pending, it mentioned, adding that the Bajaj Group getting one of the biggest sugar producers obtaining 14 sugar mills in UP, has paid only 39% of its total dues and about Rs 3,200 crore is however to be paid.