OM PRAKASH, J. The petitioner public limited Company- incorporated under the Companies Act, 1956, owns a sugar factory, which is engaged in the manufacture of crystal sugar by vacum pan process. Indubitably, molasses is a by-product of the said sugar factory. 2. The contention of the petitioner is that on 3rd June, 1995, molasses to the extent of 12,455. 65 quintals stood destroyed due to auto combustion in tank No. 2. An intimation to that effect is said to have been given to the authorities concerned. Thereupon, the District Excise Officer sent a communication dated 7-6-1995 follow ing an order dated 26-5-1995 of the Controller (Annexure "6" to the writ petition) that any short-fall of 65% molasses of total estimated production, which is reserved for being supplied to the distilleries and for industrial development under the orders of the Controller, will be made good from the remaining 35% molasses, left to the petitioner for free sale. 3. Aggrieved, the petitioner seeks quashing of the Controllers order dated 26-5-1995 and of the consequential communication dated 7-6-1995 (Annexure "6" to the writ petition ). 4. The District Excise Officer, respondent No. 3, filed a counter-affidavit on behalf of all the respondents stating that auto combustion in tank No. 2 was caused as a result of negligence of the petitioner. 5. As the event of auto combustion was frequently reported by the sugar fac tories in the past, the Controller issued the impugned order dated 26-5-1995 (An nexure "6" to the writ petition) directing the authorities that to maintain 65% supply reserved for distilleries and industrial development, deficiency arising on account of auto combustion be made good from the molasses meant for free sale, and that in compliance with the said order impugned order dated 7-6-1995 (Annexure "6" to the writ petition) was issued to the petitioner. 6. Learned Counsel for the petitioner has challenged the validity of the said orders (Annexure "6" to the writ petition) mainly on the ground that under Section 11 (1) of the UP. 6. Learned Counsel for the petitioner has challenged the validity of the said orders (Annexure "6" to the writ petition) mainly on the ground that under Section 11 (1) of the UP. Sheera Niyantran Adhiniyam, 1964 (for short, the Act) the petitioner can only be punished for contravention of any provisions of the Act or the rules or orders made or the direction issued thereunder and there is no provision under the Act enabling the Controller to pass any order to set off the molasses meant for free sale against the short-fall of reserved supplies caused by auto combus tion. Section 11 (1) falling under Chapter IV of the Act no doubt makes contraven tion of any provision of the Act or the rules or orders or the directions issued thereunder, punishable, but the question for consideration is whether a person whosoever contravenes the provisions of the Act or the rules can only be punished for the offence committed under Section 11 (1) and whether the Controller is legally competent to pass an order like the impugned order dated 26-5-1995. 7. This question can be appropriately answered only after seeing the scheme of the Act and the rules framed thereunder. The Act was enacted, as shown by preamble, to provide in public interest for the control of storage, gradation and price of molasses produced by Sugar Factories in Uttar Pradesh and the regulation of supply and distribution thereof. So the supply and distribution of molasses is clearly regulated by the provisions of the Act. Section 5 relating to the preservation o! molasses enjoins upon the occupier of a sugar factory to take adequate steps 10 provide safe accommodation for the preservation of molasses and take adequate safeguards to prevent the molasses from being destroyed in any manner. Section 8 (1) provides that the Controller may by order require the occupier of any sugar factory to sell or supply the molasses only to the persons as specified in the order and that the occupier shall comply with that order. Sub-section (2) (a) of Section 8 states that molasses will be supplied under the orders of the Controller only for the use of distilleries or for the purpose of industrial development. The recipient of molasses under the orders of the Controller is bound by the restrictions and conditions as prescribed in the order under sub-section (2) (aa) of Section 8. Sub-section (2) (a) of Section 8 states that molasses will be supplied under the orders of the Controller only for the use of distilleries or for the purpose of industrial development. The recipient of molasses under the orders of the Controller is bound by the restrictions and conditions as prescribed in the order under sub-section (2) (aa) of Section 8. Sub-section (2) (b) of Section 8, which is very important for the purposes of this case, in so far as relevant, runs as follows: " (2) The order under sub-section (1) - (a ). . . . . . (aa ). . . . . (b) may be for the entire quantity of molasses in stock or to be produced during the year or for any portion thereof ;. . . . . . . " Clause (b) of sub-section (2) clearly empowers the Controller to pass an order for the entire quantity of molasses in stock or in respect of the production during the year or for any portion thereof. It means the sale or supply of the entire quantity of the molasses belonging to the petitioners sugar factory is controlled by the Controller and the petitioner has no right of free sale, unless directed by the Controller to that effect by a specific order. The Controller has the authority to regulate the entire stock and production of molasses and under sub-section (4) of Section 8 the occupier of a sugar factory shall be liable to pay administrative charges not exceeding Rs. 5/- per quintal to the State Government. 8. When the Controller has an absolute power to regulate the entire stock and production of molasses, the contention of the petitioner that the Controller has no power to set-off the quantity of molasses meant for free sale against the short-fall of 65% reserved supply either caused by auto combustion or for any other reason, has to be rejected. 9. In exercise of rule making power conferred by Section 22 of the Act, the U. P. Sheera Niyantran Niyamavali, 1974 (brief, the rules) are framed. Rule 12 of the rules provides that the occupier of every sugar factory shall submit to the Controller a statement in each molasses year specifying an approximate estimate of the quantity of molasses to be produced in a sugar factory during the molasses year. Rule 12 of the rules provides that the occupier of every sugar factory shall submit to the Controller a statement in each molasses year specifying an approximate estimate of the quantity of molasses to be produced in a sugar factory during the molasses year. Rule 13 (1) requires every distillery in U. P. to submit to the Controller a statement by 31st August each year specifying its estimated requirements of molasses for the purposes of distillation during the molasses year. Likewise, the estimated requirement of molasses for industrial development within the State shall be furnished yearly to the Controller under sub-rule (2) of Rule 13. Under Rule 14 a consolidated statement of the estimated availability of molasses and of estimated requirement of molasses will be drawn up and placed before the Advisory Committee constituted under Sec tion 3 (1) of the Act by the Controller, who may then made appropriate orders regarding sale and supply of molasses in accordance with the provisions of Section 8 of the Act. 10. From the scheme of the Act and the rules framed thereunder, it is apparent that the occupier of a sugar factory has no right to resort to free sale of molasses and that the entire stock and production of the molasses can be sold only in accordance with the orders passed by the Controller. This authority implies that the Controller may direct the occupier of a sugar factory to make the short-fall caused either by auto combustion or otherwise, good from the quantity of molasses meant for free sale under the orders of the Controller to keep 65% supplies reserved for the use of distilleries and for the purpose of industrial development intact. 11. It is not in dispute that under the orders of the Controller, the occupier of a sugar factory is entitled to make free sale only to the extent of 35%. By impugned order dated 26-5-1995 (Annexure "6" to the writ petition), the Controller directed that loss of molasses caused by auto combustion, will be so adjusted from the quan tity of free sale as to not affect the reserved supply of 65%, meaning thereby, if there is any short-fall due to loss by auto combustion in the reserved supply of 65%, the same will be made good from the molasses meant for free sale. This has been done to keep 65% reserved supply intact. This has been done to keep 65% reserved supply intact. As appears from the afore-mentioned rules, the percentage of reserved supply and free sale was determined by the Controller con sidering the estimated production of a year and if the estimated production is reduced due to loss by auto combustion, then it would be difficult to keep 65% reserved supplies intact. If the supplies according to the estimated requirements of the distilleries and for industrial development are not made, then that would adver sely affect the distilleries and the industrial development. To obviate such distur bance, the sale or supply of molasses is controlled by the Controller. To achieve the objective that industrial development and the working of the distilleries, which are major source of revenue of the State Government for taking up various developmen tal scheme all over the province are not affected, the impugned order was passed by the Controller-to ensure uninterrupted reserved supplies to the extent of 65% for industrial development and to the distilleries. 12. We, therefore, do not see any legal infirmity in the impugned orders (Annexure "6" to the writ petition ). 13. Under Section 11 of the Act the petitioner may be punished for contraven tion of the provisions of the Act and the rules, but that does not preclude the Controller from regulating the sale or supply of the molasses. The right to resort to 35% free sale is not absolute, but that is subject to the orders of the Controller, who may to keep 65% reserved supply intact, alter the percentage of free sale. The effect of the impugned order dated 26-5-1995 is to reduce the percentage of free sale in such a manner so as to maintain the percentage of reserved supplies. By virtue of the provisions of the Act and the rules the Controller is well empowered to pass such order. 14. The petition, therefore, fails and is dismissed. Petition dismissed. .