{"id":6575,"date":"1996-10-10T00:00:00","date_gmt":"1996-10-09T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/state-of-madhya-pradesh-vs-jaora-sugar-mills-ltd-ors-etc-on-10-october-1996"},"modified":"2016-01-10T21:45:03","modified_gmt":"2016-01-10T16:15:03","slug":"state-of-madhya-pradesh-vs-jaora-sugar-mills-ltd-ors-etc-on-10-october-1996","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/state-of-madhya-pradesh-vs-jaora-sugar-mills-ltd-ors-etc-on-10-october-1996","title":{"rendered":"State Of Madhya Pradesh vs Jaora Sugar Mills Ltd. & Ors. Etc on 10 October, 1996"},"content":{"rendered":"
Supreme Court of India<\/div>\n
State Of Madhya Pradesh vs Jaora Sugar Mills Ltd. & Ors. Etc on 10 October, 1996<\/div>\n
Bench: K. Ramaswamy, G.B. Pattanaik<\/div>\n
           PETITIONER:\nSTATE OF MADHYA PRADESH\n\n\tVs.\n\nRESPONDENT:\nJAORA SUGAR MILLS LTD. & ORS. ETC.\n\nDATE OF JUDGMENT:\t10\/10\/1996\n\nBENCH:\nK. RAMASWAMY, G.B. PATTANAIK\n\n\n\n\nACT:\n\n\n\nHEADNOTE:\n\n\n\nJUDGMENT:\n<\/pre>\n
\t\t\t O R D E R
\n     These appeals  by special\tleave are  filed against the
\njudgment and  order dated September 1, 1978 and September 4,
\n1978 passed  by the  Madbya Pradesh High Court, Indore Bench
\nin Misc. Petition Nos.140, 139, 43 and 44 of 1977.\n<\/p>\n
     These appeals  arise from\tthe Sugarcane Control Order,
\n1966  [for  short,  the\t “Order”]  and\tthe  M.P.  Sugarcane
\n[Regulation of\tSupply and  Purchase] Act,  1959 [for short,
\nthe “Act”].  It is  rather unfortunate\tthat  the  sugarcane
\ngrowers who  spent their  sweat and  blood  in\traising\t the
\nsugarcane in  the Years\t 1974-75, 1975-76 had to wait for 20
\nyears to receive the price of the sugarcane supplied by them
\nto the respondents’ factories. The respondent in C.A.1813\/80
\nis a  Hindu   Undivided Family\trepresented by its Karta and
\nrespondents in\tother appeals  are  factories.\tThe  Central
\nGovernment had fixed the price of the sugarcane under Rule 3
\n[1] of\tthe Rules  issued under\t Section 3  [3] (c)  of\t the
\nEssential Commodities  Act, 1957  at  Rs.8.60  per  quintal.
\nVarious meetings  of the sugarcane growers and the sugarcane
\nfactories and  their  associations,  were  convened  by\t the
\nGovernment of  Madhya Pradesh  and ultimately  the agreement
\ngot crystallised  at the  meeting held\ton March 21, 1976 to
\nfix the\t final price of the sugarcane at Rs.12\/- per quintal
\nfor the\t sugarcane supplied  at the factory and Rs.11.50 per
\nquintal for  the sugarcane supplied at other supply centres.
\nThough the sugarcane was supplied by the cane-growers, since
\ntheirs amounts\tcould not  be paid, the appellant-Government
\nresorted to  Section 21\t of the Act to enforce the liability
\nby recovering  the same\t as arrears  of\t land  revenue.\t The
\nrespondents came  to challenge\tthe demands  by\t filing\t the
\naforesaid writ\tpetitions. The\tDivision Bench\tof the\tHigh
\nCourt in  the aforesaid\t judgments in three appeals has held
\nthat since no separate agreement was entered into between
\nthe respondents\t and the  sugarcane growers,  the  liability
\ncould not  be enforced by way of arrears of land revenue. In
\nCA No.1811\/80  involving the question of interest on account
\nof delayed  payments it\t was held  that since the amount was
\nnot paid  as  per  the\tprice  fixed  under  the  Order,  no
\nliability of  interest would  be charged  thereon. Therefore
\nthe demand  for payment\t of interest  on delayed  payment is
\nwithout authority  of law.  Thus these\tappeals\t by  special
\nleave.\n<\/p>\n
     Shri U.N.\tBachawat, learned  senior counsel  appearing
\nfor the State, contended that as per the record produced and
\nthe averments  made in\tthe counter-affidavit  filed in\t the
\nHigh Court  in the  writ petitions that there was a specific
\noral  agreement\t  between  the\tsugarcane  growers  and\t the
\nfactories represented  by the  Association and many of their
\nrepresentatives personally  present except  Kaluram’s  joint
\nfamily firm  and all  of them  have greed  to final price of
\nsugarcane. Even\t with regard  to Kaluram’s  firm, since\t the
\nmeeting was  adjourned once,  to enable him to be consented,
\nas  he\t was  present,\tthe  Secretary\tof  the\t Association
\ncontacted him  over telephone  and he agreed to abide by the
\nagreement. In  furtherance thereof,  on March  21, 1976\t the
\ngentleman agreement  has been  entered into  for  the  final
\nprice of  the sugarcane\t to be\tsupplied  by  the  sugarcane
\ngrowers. As  a consequence,  there was\tan agreement between
\nthe owners  of the sugar factories and the sugarcane growers
\nSince the  sugarcane growers  were not\tpaid the  price,  in
\nfurtherance thereof,  the factories  are liable\t to pay\t the
\nsugarcane price and also the interest on the delayed payment
\nin one appeal. The view taken by the High Court is not valid
\nin law.\n<\/p>\n
     Shri S.K.\tJain, learned  counsel for  the respondents,
\ncontended that\tRules 3\t and 5-A  of the Order determine the
\nliability to  pay the  price and  the additional  price. The
\nCentral\t Government  having  determined\t the  price  of\t the
\nsugarcane under\t the Order,  there is  no power to the State
\nGovernment, de\thors the Order, to fix any agreed price. The
\nconcept of  agreed price  came into  force on  September 19,
\n1976 by\t virtue of the Order. Until then, there was no power
\nto  fix\t  the  agreed\tprice.\tThe  State  Government\thas,
\ntherefore, no power under the Act to fix any price since the
\nfield was occupied by the Order. Kaluram was not present and
\nhe had\tnot agreed to the fixation of the increased price of
\nthe sugarcane.\tAt best,  it would  be\tonly  a\t compulsion,
\nUnless there  is an individual written agreement between the
\nfactory and  each sugarcane  grower, there is no contract to
\npay over  the same.  Such of the amounts, de hors the Order,
\ncannot be  recovered as\t arrears of  land revenue since such
\nliability visits  with\tpenal  consequences  of\t prosecution
\nunder Section  7 of  the Essential  Commodities Act. He also
\ncontends that  the retrospective  effect cannot\t be given to
\nthe price  of  the  sugarcane  supplied\t earlier  and  that,
\ntherefore, the\tOrder of the High Court is clearly legal. He
\nalso contends  that unless  the price  is  fixed  under\t the
\nOrder, no  liability to\t pay interest  arises thereon on the
\ndelayed payment\t of the\t value\tof  the\t sugarcane,  as\t was
\noriginally determined  by the  Central Government, under the
\nOrder. Under those circumstances, the view taken by the High
\nCourt is  correct in  law. In  support\tthereof,  he  places
\nreliance on  the judgments  of this  Court in State Of Tamil
\nNadu v.\t Kothari Sugar\t&   Chemicals Ltd.<\/a> [1996) 7 SCC 751]
\nand Thiru  Arooran Sugar  Ltd. v. Dy. Commercial Tax Officer<\/a>
\n[(1988)> 71
\nSTC 444 (Madras)].\n<\/p>\n
     The first\tquestion that  arises for  consideration is:
\nwhether there  is  an  agreement  for  the  final  price  of
\nsugarcane for the relevant period and if so whether it is in
\nconsonance with the Order? Related question is: whether such
\nfixation is  retrospective  in\toperation  and\twhether\t the
\nGovernment can recover such amount under the Act? As regards
\nthe fixation of the price, the field undoubtedly is occupied
\nby the\tOrder. Rule  2 [g]  of the  Order defines ‘price’ to
\nmean the  price or  the minimum\t price fixed  by the Central
\nGovernment from\t time to  time for  sugarcane delivered to a
\nsugar factory  at the  gate of the factory or at a sugarcane
\npurchasing center  or to  a khandsari  unit.  Clause  2\t [i]
\ndefines ‘producer of sugar’ to mean a person carrying on the
\nbusiness of  manufacturing sugar  by vacuum  pan process and
\nclause 2[j]  defines ‘reserved\tarea’ to mean any area where
\nsugercane is  grown and\t reserved for  a factory  under sub-
\nclause [1]  (a) of clause 6. Under clause 2 [k] ‘year’ means
\nthe year commencing on the first day of July and ending
\nwith the thirtieth day of June in the year next following.\n<\/p>\n
     Rule 3  [3]  determines  “where  a\t producer  of  sugar
\npurchases any sugarcane from a grower of sugarcane or from a
\nsugarcane  growers’s   co-operative  society,  the  producer
\nshall, unless  there is\t an  agreement\tin  writing  to\t the
\ncontrary between  the parties, pay within fourteen days from
\nthe date  of delivery  of the  sugarcane to  the  seller  or
\ntender to  him the price of the cane sold at the rate agreed
\nto  between   the  producer  and  the  sugarcane  grower  or
\nsugarcane growers`  co-operative society or that fixed under
\nsub-clause (1), as the case may be either at the gate of the
\nfactory or  at the  cane collection  centre or\ttransfer  or
\ndeposit the  necessary amount  in the  Bank Account  of\t the
\nseller or the co-operative society, as the case may be.”\n<\/p>\n
     Clause (3A)  to Rule  3 was  introduced by\t way  of  an
\namendment made\tin GSR 62(E), dated 2.2.1978. For payment of
\nthe price  within 15  days  with  interest  on\tthe  delayed
\npayment at  the rate of 15% per annum for the period of such
\ndelay beyond  14 days  has been introduced. Earlier , it was
\ncovered by  the Act.  Clause (1) of Rule 3 fixes the minimum
\nprice of  sugar payable by the purchaser of the sugarcane as
\nfixed by  the Central  Government in  the  manner  indicated
\ntherein. Clause (2) of Rule 3 is relevant for the purpose of
\nthis case which shows that “no person shall sell or agree to
\nsell sugarcane\tto a  producer of  sugar or his agent and no
\nsuch producer  or agent\t shall purchase or agree to purchase
\nsugarcane, at a price lower than that fixed under sub-clause
\n(1).” Section  23(3) of\t the Acts  also couched\t in  similar
\nlanguage, enables  to novate  by contract  the minimum price
\nfixed by  the Central  Government in respect of cess payable
\nto Government.\n<\/p>\n
     This would\t clearly indicate  that despite the fixation
\nof minimum  price under\t clause (1)  of Rule 3, by agreement
\nbetween the  sugarcane\tgrower\tand  the  purchaser  of\t the
\nsugarcane, they\t would be  at liberty  to agree\t to sell  or
\npurchase the sugarcane at a higher price than that was fixed
\nby the\tCentral Government  under clause (1) of Rule 3. Only
\nfor postponement  of payment  beyond 14 days there should be
\nan agreement  in writing  between the parties obviously with
\nthe concurrence\t of the\t Central  Government  or  authorised
\nauthority  in  that  behalf.  Thus  there  is  no  statutory
\nprohibition in\tthat behalf  to pay higher price. That would
\nbe further  clear by  Rule 3(2) which speaks of the contract
\nbetween the parties for payment of higher price of sugarcane
\nfixed under  clause (1)\t of Rule 3 pursuant to the agreement
\nor pursuant  to the  minimum  price  fixed  by\tthe  Central
\nGovernment under Rule 3(1) of the Order.\n<\/p>\n
     Rule 3A  speaks of rebate that can be deducted from the
\nprice paid  for sugarcane.  In other  words this  concept of
\nagreed price  paid was\tbrought on  statute with effect from
\nSeptember 24,  1976 by\tamendment made\tthrough GSR.815 (E).
\nPrior to  the statutory\t concept of  the agreed\t price, Rule
\n3(2) did  not preclude\tthe  parties;  in  other  words,  it
\nenabled the  parties to\t agree for  a higher price than what
\nwas fixed  for the  sugarcane supplied by sugarcane supplier
\nunder Rule  3(1) of  the Order.\t In addition,  Rule 5A\talso
\ngives Power  to fix  and pay  additional price for sugarcane
\npurchased on  or after\t1st October, 1974. Thus, it could be
\nseen that prior to coming into force of Rule 3A, the minimum
\nprice fixed  by the  Central Government\t under Rule 3(1) and
\nadditional price  fixed\t  under Rule  5A, it  was within the
\ndomain of the contract between the sugarcane growers and the
\nfactories who  could agree  to pay  price  higher  than\t the
\nminimum price  fixed under  the Order.\tWhat sub-rule (2) of
\nRule 3\tprohibits is  the purchase  or sale  or agreement in
\nthat behalf,  for bargain  to  pay  price  lesser  than\t the
\nminimum price  fixed by\t the Central  Government.  In  other
\nwords, the sugarcane growers should not be compelled to sell
\nthe sugarcane  at a  price lesser than was prescribed by the
\nOrder. Thus, we hold that there was no statutory prohibition
\nat the\trelevant time  to agree to pay higher price than was
\nfixed under the order.\n<\/p>\n
     The question  then is:  whether such a higher price has
\nbeen agreed  to be  paid  to  the  sugarcane  growers,\twhen
\ncontract has come into existence between the respondents and
\nthe canegrowers\t with the agis of the appellants? As a fact,
\nexcept Kaluram,\t all representatives of other factories were
\npresent at  the time  of the agreement dated March 21, 1976.
\nAs far as Kaluram is concerned, on the first occasion he was
\npresent, but  on the  second occasion  when the meeting\t was
\nadjourned, he  was not\tpresent. It  has been averred in the
\ncounter-affidavit  that\t  the  Secretary  of  the  Sugarcane
\nFactories Owners’  Association had contacted him when he was
\nin the\thospital and  thereafter, the  agreement was entered
\ninto. Though,  subsequently, an\t attempt  was  made  by\t the
\nSecretary to Wriggle out from it, the Government have stated
\nthat and  the sugarcane\t growers have  also agreed  for\t the
\nsame, we are of the considered view that he was a consenting
\nparty and there was consensus ad idem to pay higher price of
\nsugarcane than\tthe  minimum  price  fixed  by\tthe  Central
\nGovernment and\tthey acted upon it, There was no prohibition
\nfor oral  agreement between  growers and  owners through the
\nservice of  the Cane  Commissioner, a statutory authority to
\neffect such  agreement. It is not in dispute that thereafter
\nthe  sugarcane\t growners  supplied  the  sugarcane  to\t the
\nrespondent factories  and that\tthey utilized  the sugarcane
\nfor producing  the  sugar.  Other  factories  had  paid\t the
\nagreement price.\n<\/p>\n
     The contention of Shri S.K. Jain that the agreement was
\nretrospective is  not correct. It is seen that the sugarcane
\ncrushing year  has been\t defined under\tthe Order itself and
\nduring the  season the Price fixed by the Central Government
\nwas treated  by the  State Government  to be  the  tentative
\nprice, subject\tto agreements  between the  parties and\t the
\nfinal price  was agreed\t as contracted by the parties. Thus,
\nwe hold\t that the  payment of price @ Rs.12\/- per quintal at
\nthe factory  and Rs.11.50  per\tqunital\t at  the  purchasing
\ncentre was  agreed price  for supply  of  sugarcane  by\t the
\nsugarcane growers  and received\t by  the  factories  at\t the
\nrespective places.\n<\/p>\n
     The question  then is: whether it is a compulsive price
\nend whether  the State\tGovernment had\tentered into  such a
\ncontract? It is seem and it cannot be disputed that the Cane
\nCommissioner is\t the statutory\tauthority under\t the Act and
\nthe Order to regulate fixation of the zone for the supply of
\nsugarcane to  the respective factories and for regulation of
\nsupply of  sugarcane to the factories covered under the Act.
\nSection\t 12   of  the\tAct  speaks  of\t estimation  of\t the
\nrequirements under  Sections 15 to 17 of the Act of quantity
\nof sugarcane  required to be supplied to the occupier of the
\nfactory. Section  13 speaks  of\t registration  of  sugarcane
\ngrowers and  the sugarcane  growers  Co-operative  Societies
\nwithin the  area of  the occupier of the factory. Section 15
\ndeals with  declaration of the reserved area for the factory
\nunder sub-section  (2) of  Section 19. Section 16 deals with
\ndeclaration of\tassigned area  to the  factory.\t Section  19
\ndeals with  regulation of purchase and supply of cane in the
\nreserved area and assigned area respectively. The payment of
\nthe price  is regulated\t under Section\t20  which  reads  as
\nunder:\n<\/p>\n
     “20. Payment  of cane  price. – (1)
\n     The occupier  shall  make\tsuitable
\n     provision to  the\tsatisfaction  of
\n     the collector  for\t  the payment of
\n     the price of cane.\n<\/p><\/blockquote>\n
     (2) Upon  the delivery  of cane the
\n     occupier shall  be\t liable\t to  pay
\n     immediately the  price of\tthe cane
\n     so\t supplied,   together  with  all
\n     other sums\t connected therewith and
\n     where the\tsupplies have  been made
\n     through  a\t purchasing  agent,  the
\n     purchasing\t agent\t also  shall  be
\n     similarly liable in addition to the
\n     occupier.\n<\/p><\/blockquote>\n
     (3) Where\tthe person  liable under
\n     subsection (2)  is\t in  default  in
\n     making the payment of the price for
\n     a period  exceeding  fourteen  days
\n     from the  date of delivery he shall
\n     also pay  interest at  a rate of 7-
\n     1\/2 per  cent per\tannum  from  the
\n     said date\tof delivery  up\t to  the
\n     date  of\tpayment\t but   the   Can
\n     Commissioner  may,\t  in  any   case
\n     direct with  the  approval\t of  the
\n     State Government  that no\tinterest
\n     shall be  paid or\tbe paid\t at such
\n     reduced rate as he may fix.<\/p><\/blockquote>\n
     (4)  The  Cane  Commissioner  shall
\n     forward   to    the   Collector   a
\n     certificate  under\t  his  signature
\n     specifying the amount of arrears on
\n     account of\t the price  of cane plus
\n     interest,\tif  any,  due  from  the
\n     occupier  and   the  Collector   on
\n     receipt of\t such certificate  shall
\n     proceed  to   recover   from   such
\n     occupier\tthe   amount   specified
\n     therein as\t if it were an arrear of
\n     land revenue  together with further
\n     interest  up   to\t the   date   of
\n     recovery.”<\/p><\/blockquote>\n
     It would  thus be\tclear  that  the  Cane\tCommissioner
\nhaving power  to compel\t the cane  growers to supply cane to
\nthe factory Khandsari unit, he has incidental power and duty
\nbound to  ensure payment  of  the  price  of  the  sugarcane
\nsupplied by  the sugarcane grower. The price fixed or agreed
\nis a  statutory price and bears the stamp of statutory first
\ncharge on the sugar and assets of the factory over any other
\ncontracted liabilities to recover the price of the sugarcane
\nsupplied to the factory or Khandsari unit.\n<\/p>\n
     Section 23 deals with levy of cess on the sugarcane and
\nsub section (3) contemplates that “notwithstanding the terms
\nof any\tcontract or  agreement\tfor  sale  of  cane  whether
\nentered into  before or\t after the  imposition of  the\tcess
\nunder this Section, the buyer of the cane shall be liable to
\npay the amount of the cess in addition to and as part of the
\ncontracted price  of such  cane.”  The\tperson\twho  commits
\ndefault in making payment of the cess shall be liable to the
\nrecovery thereof  with interest enumerated in subsection (4)
\nof Section  23 and  recovery has  been envisages  thereunder
\nread with  sub-section (5)  of Section\t23. But the material
\nfact is\t that  sub-section  (3)\t also  gives  an  indication
\nanalogous to  Rule 3(2) of the Order that in addition to the
\nprice fixed,  the higher  price should always be permissible
\nto be  entered\tby  a  contract\t or  agreement\tbetween\t the
\nparties.\n<\/p>\n
     Section 26\t imposes levy  of penalty for non-payment or
\ncontravention of  the provisions  of the  Act or  the Rules.
\nSection 27  provides the  procedure for\t institution of\t the
\nproceedings. Thus, the statutory authority has obligation to
\nensure proper  price of\t sugarcane supplied by the sugarcane
\ngrowers. Thus,\tthe Government\thas to ensure the meeting of
\nthe  growers   and  occupiers\tof   factories\t and   their
\nAssociation. Thereat the final price of sugarcane was fixed;
\nthe  parties  orally  agreed  thereto  and  the\t proceedings
\nculminate into\ta concluded  gentlemen contract.  It  is  in
\nnotation  of   the  minimum   price  fixed  by\tthe  Central
\nGovernment. The\t agreement is to tainted with compulsion, as
\ncontended but  in novation  of the minimum price fixed under
\nthe order.\n<\/p>\n
     Thus, it  would be\t seen that  the Act  regulates\t the
\nrecovery as arrears of land revenue. Accordingly, demand has
\nbeen  made   for  payment   of\tthe   amount  in  a  sum  of
\nRs.6,34,166\/- in  CA  No.1813\/80,  Rs.13,40.700\/  in  CA  No
\n1814\/80\t and  Rs.2,71,000\/-  in\t CA  No.1812\/80.  Thus,\t the
\ndemands issued\tagainst the  respondents are  in  accordance
\nwith the  provisions of\t the Act  and they are liable to pay
\nthe same.\n<\/p>\n
     The question  then is:  whether the  respondent is also
\nliable to  pay interest\t for the delayed payment? It is seen
\nthat under  the Order  and the\tAct there is power to impose
\ninterest not  exceeding 15%.  In this  case, 14% and odd was
\nthe interest  levied on\t delayed payment. It is seen that in
\nview of the agreement, as upheld earlier, in addition to the
\nminimum price, therefore, the liability has arisen under the
\nOrder for  payment of the value of the sugarcane supplied by
\nthe growers.  On account  of the default in payment thereof,
\nin terms  of clause (3) of Rule 3, since it was not paid, by
\noperation of  Section 20  of the  Act, they  are entitled to
\nrecover the  same as arrears of land revenue. Therefore, the
\nview of the High Court is clearly illegal.\n<\/p>\n
     Though Shri  S.K. Jain  is\t right\tin  contending\tthat
\nunless there  is  an  agreement\t between  the  parties,\t the
\nliability cannot be fastened under the Order or the Act; but
\nin view\t of the\t finding that there was an agreement between
\nthe parties,  as held  earlier, the ratio in the judgment in
\nKothari`s case\t(supra) relied\ton by  the counsel is of not
\nmuch assistance\t in the\t facts of  this case.  On the  other
\nhand, it  supports the view we have expressed above. Therein
\nthis Court  upheld that if there is an agreement between the
\nparties, than  by operation of the Order the liability would
\nbe fastened  on the sugar factory. In those cases, there was
\na finding  that there was no proof of agreement entered into
\nbetween the  factory and  the cane-growers. Therefore, sales
\ntax would  not be recovered on the price fixed in excess for
\nminimum cane price fixed by the Central Government under the
\nOrder.\n<\/p>\n
     In Thiru Arooran Sugars Ltd`s case (supra) relied on by
\nShri Jain,  the learned\t Judges had  considered Rule 3(1) of
\nthe Order  and the finding that there is no power to fix any
\nprice in  excess or  the minimum price fixed under the Order
\nwas rejected.  It is  clearly illegal.\tRule  3(2)  was\t not
\nbrought to  the notice\tof this Court, when the decision was
\nupheld, but  on the  facts it  makes no difference since the
\nview in\t Kothari’s case (supra) is not inconsistent with the
\nview  we  have\texpressed.  On\tthe  other  hand,  the\tview
\nexpressed therein  also is  consistent with the view we have
\ntaken. In fact, in Tungabhadra Sugar Works Ltd. vs. State of
\nKarnataka & Ors. [(1994) 73 STC 561] approved by this Court,
\nthe Division  Bench of\tthe Karnataka  High  Court  squarely
\nconsidered this\t question  and\thad  held  at  page  577  in
\nparagraph 20  that “Even though the contract may fix a price
\nnothing prevents  the parties from subsequently modifying or
\nincreasing the\tprice, resulting  in novation. The aforesaid
\nterm  in  the  contract\t can  be  relied  on,  only  if\t the
\npetitioner had\tpaid a\tscale price  as\t determined  by\t the
\nCentral\t Government  under  the\t control  order.  Where\t the
\npetitioner has\tpaid a\thigher price than what is payable in
\nterms of  Rule 3 and 5A(1), it will be a case of novation of
\ncontract and  the increased  Price will replace the original
\ncontract term relating to price.” We approve of the view and
\naccordingly we\thave no\t hesitation to hold that the parties
\nwould always  be at  liberty to\t agree for payment of higher
\nprice than the minimum price fixed by the Central Government
\nand the contract will be novation of the minimum price fixed
\nby the\tCentral Government  under Rule\t3(1) of\t the Order .
\nTherefore, the\trespondent is  liable  to  pay\tinterest  on
\ndelayed payment under the Act read with the order.\n<\/p>\n
     We are  informed that  these two mills have become sick
\nmills and  have been  taken over  by the  Government. If the
\namount has not been paid already, the Government is directed
\nto disburse  the amount within a period of 3 months from the
\ndate of\t the receipt of the respondents etc. If there is any
\nshortfall in  the amount, the assets of the respondents etc.
\nIf  there  is  any  shortfall  in  the\tamount,\t the  assets
\nrecovered from\tthe sick mills, if any, may be fastened as a
\nliability on  the sick\tmills and  be adjusted in accordance
\nwith the take-over proceedings.\n<\/p>\n
     The appeal\t s are accordingly allowed. But for the fact
\nthat the  mills have  been taken over, we would have imposed
\nexemplary costs in this case; hence we impose no costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India State Of Madhya Pradesh vs Jaora Sugar Mills Ltd. & Ors. Etc on 10 October, 1996 Bench: K. Ramaswamy, G.B. Pattanaik PETITIONER: STATE OF MADHYA PRADESH Vs. RESPONDENT: JAORA SUGAR MILLS LTD. & ORS. ETC. DATE OF JUDGMENT: 10\/10\/1996 BENCH: K. RAMASWAMY, G.B. PATTANAIK ACT: HEADNOTE: JUDGMENT: O R D E […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-6575","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nState Of Madhya Pradesh vs Jaora Sugar Mills Ltd. & Ors. 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