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1978 (12) TMI 192

..... ashad and Mrs. S. Bagga for Respondent. JUDGMENT Tulzapurkar V.D., This appeal by certificate is directed against the judgment rendered by the Allahabad High Court on December 5, 1967 in Special Appeal No. 1068 of 1967 and raises a short question whether the appellant is entitled to the benefit of certain concessions (deductions) in the minimum price notified by the Cane Commissioner in his order issued on June 1, 1955 ? The appellant (Shri Janki Sugar Mills & Company) is a partnership firm carrying on the business of manufacturing sugar. By an order passed on November 1, 1954 under s. 15 of the Uttar Pradesh Sugar Cane (Regulation of Supply and Purchase) Act 1953, the Cane Commissioner reserved certain sugarcane centres for the appellant's sugar factory. On November 12, 1954 (i.e. within 14 days of the reservation of the sugarcane centres) the respondent No. 4 (Laskar Co-operative Cane Development Union Ltd.) made an offer for the 1954-55 crushing season for the supply of 6 lac maunds of sugarcane out of a total estimated yield of 12 lac maunds of sugarcane from certain centres. This offer was accepted by the appellant-firm on November 27, 1954 (i.e. within 14 days of the .....

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..... 953 against the appellant firm for a sum of ₹ 53,878/10/- being the amounts deducted by the appellant-firm while making payments to Respondent No. 4. The appellant-firm disputed the legality of the Recovery Certificate on the ground that it had the right to make the deductions in view of the Cane Commissioner's Notification dated June 1, 1955. The said dispute was referred by the Cane Commissioner to the District Cane Officer, Bulandshahr as the sole arbitrator under Rule 108 of the U.P. Sugarcane (Regulation of Supply & Purchase) Rules, 1954. By his award dated May 30, 1962, the District Cane Officer held that the appellant-firm had wrongly made the deductions in respect of the supply of two lac maunds of sugarcane which was "bonded cane" and that the appellant-firm was liable to pay the minimum price therefor. Aggrieved by the award the appellant-firm preferred an appeal to the Divisional Commissioner, Meerut under Rule 118 of the said Rules, but the appeal was dismissed on March 30, 1963. The appellant-firm challenged the legality of the award of the District Cane Officer as also the appellate order of the Divisional Commissioner by means of a writ Petiti .....

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..... the Cane Commissioner's Notification dated June 1, 1955. It was further pointed out that though under sub-cl. (4) of cl. 3 of the U.P. Sugarcane supply and Purchase Order, 1954, the Cane Commissioner had the power to extend the date for making offers in respect of any reserved area, no such extension had been granted by the Cane Commissioner in the instant case, and, therefore, the offer of two lac maunds of sugarcane which was made by respondent No. 4 on March 22, 1955, long after the expiry of 14 days from the issuance of the order of the Cane Commissioner on November 1, 1954 reserving certain sugarcane centres for the appellant's factory under s. 15 of the Act, could not culminate into an agreement under the statute or the U.P. Sugarcane Supply and Purchase Order, 1954, that the agreement entered into between the parties on May 4, 1955 in respect of the said supply must be regarded as an ordinary contract under the Indian Contract Act and that the sugarcane supplied under such ordinary contract must be regarded as unbonded sugarcane. In other words, the contention was that only such sugarcane as would be supplied by a cane-grower or a Cane- growers' Cooperative Socie .....

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..... bonded sugarcane" and as such the appellant-firm was not entitled to the concession in the minimum price payable in respect thereof to respondent No. 4. Considering the question in the context of sub-cls.(2) and (3) of cl.3 of the U.P. Sugarcane Supply and Purchase Order 1954 also we are clearly of the view that the appellant firm was not entitled to the benefit of the Cane Commissioner's Notification dated June 1, 1955. For this purpose it will be necessary to refer to s. 15 of the U.P. Sugarcane (Regulation of Supply and Purchase) Act, 1953 and set out Cl. 3 of the U.P. Sugarcane Supply and Purchase Order, 1954. Under s.15(1) of the Act power has been conferred upon the Cane Commissioner after consulting the factory and the cane-grower/Canegrowers' Co-operative Society to (a) reserve any area (hereinafter called the reserved area) or, (b) assign any area (hereinafter called an assigned area) for the purpose of the supply of sugarcane to a factory in accordance with the provisions of s.16 during one or more crushing seasons as may be specified. It was under this provision that the Cane Commissioner has passed order dated November 1, 1954 reserving certain sugarcane ce .....

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..... kes an offer within 14 days mentioned in sub-cl.(2) it is obligatory upon the occupier of the factory to accept that offer within 14 days of the receipt of the offer, this only means that if the offer is made by the cane-grower or Cane-growers' Cooperative Society beyond the period specified in sub- cl.(2) or the extended time under sub-cl.(4) it would not be obligatory but optional for the occupier of the factory to accept the said offer but if such offer made beyond the prescribed or extended period is accepted by the occupier of the factory a binding agreement comes into existence between the parties and sugarcane supplied thereunder would be 'bonded sugarcane', more so when the agreement is entered into in the prescribed form. Merely because the offer from the cane-grower or Cane-growers' Co-operative Society emanates after the expiry of the period mentioned in sub- cl.(2) it does not mean that the parties are prevented from entering into an agreement in the prescribed form and if they do enter into an agreement in the prescribed form, as was the case here, the sugarcane supplied thereunder would be 'bonded sugarcane'. It is not possible to accept the co .....

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