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HIGH COURT OF PATNA
R.L. Narasimham, C.J. & B.N. Jha, J.
THE PURTABPORE COMPANY LIMITED – Petitioner
VERSUS
CANE COMMISSIONER BIHAR, PATNA & SEVEN OTHERS – Respondents
C.W.J.C. No. 816 of 1967
Decided on : 18th March, 1968
SUGAR CONTROL ORDER - RESERVATION OF AREA FOR SUGAR FACTORY - POWER OF CANE COMMISSIONER - MODIFICATION OF ORDER - PRINCIPLE OF NATURAL JUSTICE - MALA FIDE - DISCRIMINATION - TERRITORIAL JURISDICTION - VALIDITY OF ORDER.
Fact of the Case:
The petitioner, a sugar factory located in Uttar Pradesh, challenged the validity of two orders passed by the Cane Commissioner of Bihar, which modified an earlier order reserving a certain area for the petitioner's factory for the purchase of sugarcane. The petitioner contended that the impugned orders were quasi-judicial in nature and, therefore, the Cane Commissioner had no jurisdiction to modify the earlier order without giving the petitioner an opportunity of being heard. The petitioner also alleged that the impugned orders were passed mala fide and were discriminatory against the petitioner.
Finding of the Court:
The Court held that the impugned orders were not quasi-judicial in nature but were administrative orders. The Court further held that the Cane Commissioner had the jurisdiction to modify the earlier order under the provisions of the Sugarcane (Control) Order, 1966, and that the principle of natural justice did not require the Cane Commissioner to give the petitioner an opportunity of being heard before passing the impugned orders. The Court also held that there was no evidence to support the petitioner's allegations of mala fide or discrimination. Finally, the Court held that the Cane Commissioner had the jurisdiction to pass the impugned orders even though the petitioner's factory was located outside the State of Bihar.
Issues: 1. Whether the impugned orders were quasi-judicial in nature and, therefore, the Cane Commissioner had no jurisdiction to modify the earlier order without giving the petitioner an opportunity of being heard. 2. Whether the impugned orders were passed mala fide. 3. Whether the impugned orders were discriminatory against the petitioner. 4. Whether the Cane Commissioner had the jurisdiction to pass the impugned orders even though the petitioner's factory was located outside the State of Bihar.
Ratio Decidendi: 1. The impugned orders were not quasi-judicial in nature but were administrative orders. The Cane Commissioner had the jurisdiction to modify the earlier order under the provisions of the Sugarcane (Control) Order, 1966, and the principle of natural justice did not require the Cane Commissioner to give the petitioner an opportunity of being heard before passing the impugned orders. 2. There was no evidence to support the petitioner's allegations of mala fide or discrimination. 3. The Cane Commissioner had the jurisdiction to pass the impugned orders even though the petitioner's factory was located outside the State of Bihar.
Final Decision: The Court dismissed the writ petition with costs.
Narasimham, C.J.
The petitioner is a company owning a sugar factory at Rampur, Police Station Bankata, district Deoria of Uttar Pradesh, known as Purtabpore Sugar Factory. The factory is located at a distance of about hundred yards from the Uttar Pradesh-Bihar border, and the district of Saran of the State of Bihar is adjacent east of the factory. The nearest Railway Station for the factory is Mairwa Railway Station of the North-Eastern Railway situated in the State of Bihar, from here there is a private light railway connecting with the factory. From the map filed by the parties, it is clear that the boundary of the district of Saran practically encircles the sugar factory on the southern, eastern and northern sides. On account of this peculiar geographical situation, the factory is dependent (partly, at any rate) for its supply of sugarcane on some of the villages of Saran District adjacent to it. Since 1938, a compact block of 208 villages, forming a belt four miles wide and nine miles long, in Saran District, very close to the factory, was reserved for the supply of sugarcane under the Bihar Sugar Factories (Control) Act, 1937. The petitioner has claimed that it used to advance large sums of money to cultivators of sugarcane in the said villages, that various development activities in the villages were also performed by the petitioner after investing large sums of money, that prices for the sugarcane supplied were also promptly paid, and that the sugarcane growers of that area were very much satisfied with the treatment given to them by the petitioner. With a view to secure equitable distribution of sugarcane to those factories situated close to the border between the State of Bihar and Uttar Pradesh and also to create a forum for discussion of matters of mutual interest, a Joint Sugarcane Board for Uttar Pradesh and Bihar was constituted consisting of representatives of both the States. On or about the 3rd February, 1964, the Cane Commissioners of Uttar Pradesh and Bihar entered into an agreement to the effect that the said 208 villages would continue to be reserved for the petitioner's factory from 1964-65 (see Annexure B). Some of the sugar factories located in the State of Bihar, including the factory of respondent no. 5 (known as the New Sevan Sugar Factory) were dependent for their supply of sugarcane on the cane-growing areas...... in the district of Champaran, adjacent north of Saran and bordering on Uttar Pradesh; but, for the convenient transport of sugarcane from Dhanbad area of Champaran to the factories in the district of Saran, there were two centres at the Railway Stations of Dudhai and Taraiya-sujan which were both located in Deoria district of Uttar Pradesh. Hence, by way of reciprocal arrangement, the Uttar Pradesh authorities permitted these two centres to be operated exclusively by the Bihar factories, and also exempted the sugarcane transported through those centres from payment of purchase tax in Uttar Pradesh. Thus, the agreement of 1964 between the two Cane Commissioners was on a reciprocal basis for mutual advantage of the factories situated in the bordering areas of Uttar Pradesh and Bihar. In pursuance of this agreement, in 1964-65 and 1965-66 also, the said 208 Villages were reserved for the petitioner's factory; but respondent no. 5 wanted an altercation in the said reservation and made a representation on the 17th February, 1966, which was, however, rejected.
2. In the meantime, on the 16th July, 1966, the Central Government made the well-known Sugarcane (Control) Order, 1966 (hereinafter referred to as the Order), in exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955. Clause 6 of the Order conferred power on the Central Government to regulate distribution and movement of sugar-cane. The material paragraphs of that clause for our purpose are Paragraphs (a), (b) and (c) of Sub-clause (1) which are as follows :-
"6. (i) The Central Government may, by order
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