Judgment :- N. Kumar, J., 1. When all these writ petitions were listed before a learned single Judge of this Court, after hearing the parties the learned single Judge has passed an order on 25/2/2011. The relevant portion of which reads as under: As it involves interpretation of Clause 3, 3A and 6 of the Sugarcane Control Orders 1966, in the background of the observations made by the Honourable Supreme Court in the case of UP Co-operative Cane Unions Federation versus West UP Sugar Mills Association and others reported in AIR 2004 SC 3697 (Supra) and the observation made in SLP (C) 8194 -8198/2010 dated 29/3/2010 (Annexure-R13), I am of the considered view that the said issue regarding interpretation of clause 3, 3A and 6 of the Sugar Control Order, 1966 vis-a-vis. Price agreed between parties under Contractual agreements requires to be examined and resolved by a Division Bench so that issues raised in all these writ petitions can be resolved once and for all and laid to rest and also to ensure that these repetitive prayers would stand answered and filing of repetitive writ petitions year after year can be avoided. 2. Therefore he directed that the writ petitions be placed before the Honourable Chief Justice for appropriate orders. In pursuance of the said order the learned Honourable Chief Justice by his order dated 30/5/2010 directed the listing of these writ petitions before the Division Bench. Accordingly these writ petitions are listed before us. 3. This order of reference was challenged in writ appeal No.6221-6223/2011. However the writ appeals came to be dismissed on 28/6/2011 on the ground that said order is not adjudicatory in nature. After declining to entertain the writ appeal, the writ appeal came to be disposed of with an observation that liberty is reserved to the appellants to request the Division Bench to expedite the hearing of the writ petitions. That is how the hearing of the writ petitions is taken up for consideration. 4. What is challenged in these writ petitions is the order dated 11/1/2011 passed by the Government withdrawing the earlier order dated 26/11/2010. The said order dated 26/11/2010 had been challenged before this Court in writ petition No.68780/2010. When the order dated 26/11/2010 came to be withdrawn, on a memo filed, the said writ petition came to be dismissed by an order dated 12/1/2011. The said order dated 26/11/2010 had been challenged before this Court in writ petition No.68780/2010. When the order dated 26/11/2010 came to be withdrawn, on a memo filed, the said writ petition came to be dismissed by an order dated 12/1/2011. If the impugned order is set aside, in effect it would revive writ petition No.68780/2010. In fact an application is also filed to recall the order dated 12/1/2011 in W.P.No.68780/2010, which is taken on record and in view of our observations made hereinabove said order dated 12.1.2011 is recalled. Therefore by consent of parties we have heard both the writ petitions together and a common order is passed. 5. For the purpose of convenience the parties are referred to as set out in W.P.No.68780/2010. 6. The petitioner India Sugars and Refineries Limited is a company registered under the provisions of the Companies Act. It has established a sugar factory in the year 1933. Their case is, over the years the crushing capacity of the petitioner was increased and as of now its crushing capacity is 2,500 TCD. The petitioner is required to crush minimum quantity of sugarcane of 4 lakh MT for every sugar season for its viability having regard to its capital investment, number of employees and the payment of interest to the banks and financial institutions etc. It was declared as a sick company in the year 1999 and the scheme of rehabilitation is being implemented as per the order of BIFR. 7. The respondent No.1 issued Sugarcane (Regulation and Distribution) Hospet Order 1974 reserving areas i.e., sugarcane growing areas in favour of the petitioner factory. Under the said order 33 villages in Hospet Taluka. 36 villages in Hagaribommahahalli Taluka were reserved for the supply of sugarcane to the petitioner. Again by another notification dated 28/8/2006 another 19 villages of Koppal Taluka were reserved temporarily for supply of sugarcane to the petitioner/ factory. Under Order of 1974 the crushing capacity of the factory was taken as 1,500 tons per day. The quantity of sugarcane required by the factory during the year was taken as about 2,40,000 tons. However under the 2006 order crushing capacity was taken as 2,000 TCD and the quantity of sugarcane required by the factory during the year was taken as 3.6 lakhs MT to 4 lakhs MT. The quantity of sugarcane required by the factory during the year was taken as about 2,40,000 tons. However under the 2006 order crushing capacity was taken as 2,000 TCD and the quantity of sugarcane required by the factory during the year was taken as 3.6 lakhs MT to 4 lakhs MT. The Cane Commissioner on 3/4/2007 directed the petitioner to continue crushing operations till 31/5/2007 and not to stop the same without the permission of the Government for the sugar season 2006-07. On compliance of the said order of the Cane Commissioner, he passed an order on 14/8/2007 observing that by paying statutory minimum price for sugar season 2006-07 to the sugarcane growers the petitioner has sustained loss and the farmers have benefited broadly and therefore recommended for payment of concession and relief to the petitioner factory. 8. On 17/12/2007 the Cane Commissioner passed an order directing the petitioner to pay the agreed price which was in excess of the minimum price fixed by the Central Government. Petitioner challenged the said order of the Cane Commissioner by preferring W.P.No.725/2008 before this Court. The order of the Cane Commissioner was set aside and the matter was remanded back to him. Thereafter the Commissioner passed another order on 5/7/2008 holding that the agreement dated 3.1.2007 was enforceable. The said order was also challenged by the petitioner before this Court in W.P. No.10479/2008 on the ground that the Cane Commissioner had no jurisdiction to pass such an order. The writ petition was allowed and matter was remitted back to the Cane Commissioner to give a finding on the question of jurisdiction. The Cane Commissioner by an order dated 17/9/2009 held that he had jurisdiction in the matter. The said order was challenged before this Court in W.P.No.64840/2009 which came to be disposed of in view of the agreement entered into between the factory and the farmers by an order dated 12/1/2011. 9. This Court during the pendency of W.P.No.725/2008 had directed the farmers of the reserved area to supply the sugarcane to the petitioner. Accordingly the crushing operation started from 16/2/2008. The petitioner crushed about 2.54 lakhs MT of sugarcane during the sugar season 2007-08. 9. This Court during the pendency of W.P.No.725/2008 had directed the farmers of the reserved area to supply the sugarcane to the petitioner. Accordingly the crushing operation started from 16/2/2008. The petitioner crushed about 2.54 lakhs MT of sugarcane during the sugar season 2007-08. For the sugar season 2008-09 Hospet Raitara Sangha raised hue and cry that the petitioner was in arrears of dues and the petitioner has to pay the due, then only they would supply the sugarcane for the sugar season 2008-09. They also demanded Rs.1,500/-per MT as against SMP of Rs.830/-per MT for the sugar season 2008-09. When the negotiations failed, farmers started diverting the sugarcane from the reserved area of the petitioner factory illegally to neighbouring, sugar factories M/s.Siruguppa Sugars, M/s. Shamanur Sugars, M/s.Davangere Sugars, M/s.Renuka Sugars, etc. This action was challenged by the petitioner by preferring W.P.No.31532/2008. As no interim order was granted, petitioner preferred writ appeal No.5139/2008 wherein an interim order of stopping of diversion of sugarcane was granted by the Division Bench of this Court on 10/12/2008. The said writ appeal came to be dismissed as not maintainable. The said order was challenged before the Apex Court by filing SLP No.231/2009 which also came to be dismissed with an observation that the learned single Judge shall hear the W.P. No.31532/2008 expeditiously. 10. The said writ petition came to be disposed of on 9/9/2009 holding that Deputy Commissioner is the competent authority to implement the various provisions of the Sugarcane (Control) Order 1966 (for short hereafter referred to as 'order') and also to prosecute the sugar factories who had procured from the reserved area of the petitioner the sugar cane for the sugar season 2008-09. In the said order it was also held that an agreement between the growers of the sugarcane and the manufacturers of sugar is only for the purpose of determining the quantity of sugarcane to be supplied. Even without agreement by virtue of the provisions contained in the order, the growers of the sugarcane are bound to supply the sugarcane to the factory in whose favour the area had been reserved. In spite of the order when the Government did not initiate any criminal proceedings, the petitioner initiated criminal prosecution under the provisions of Essential Commodities Act. Even without agreement by virtue of the provisions contained in the order, the growers of the sugarcane are bound to supply the sugarcane to the factory in whose favour the area had been reserved. In spite of the order when the Government did not initiate any criminal proceedings, the petitioner initiated criminal prosecution under the provisions of Essential Commodities Act. In the meanwhile five farmers of the reserved area filed W.P.No.37820/2009 for a writ of mandamus seeking direction to the Deputy Commissioner, Bellary, to issue permits to divert the sugarcane to other factories. This Court passed an order directing the petitioner to deposit 3 days in advance at the rate of Rs.1,700/-per MT before taking the delivery of the sugarcane grown in the reserved area. When the Deputy Commissioner wrongly interpreted the said order and directed the petitioner to deposit Rs.48.84 crores, the same was challenged by filing a writ appeal No.5243/2009 against the order of the learned single Judge. The said writ appeal No.5243/2009 came to be dismissed by an order dated 21/1/2010 on the ground that the order passed by the learned single Judge is a consent order. Aggrieved by the said order the petitioner preferred Special Leave Petition before the Honourable Supreme Court of India in SLP No.8194-8198/2010. The Supreme Court by an order dated 19/2/2010 directed the growers of the sugarcane to supply sugarcane exclusively to the petitioner factory and the petitioner to deposit 3 days amount at the rate of Rs.1,700/-per MT for 2.500 tons based on crushing capacity which comes to around to Rs.1.3 crores and to maintain the same during the crushing operations. On 29/3/2010 when a submission was made before the Apex Court that the petitioner has no capacity to crush the sugarcane, the Apex Court observed that it is for the Cane Commissioner to take appropriate decision in the matter to alter the reserved area, in case if he feels that the petitioner was not in a position to crush the sugarcane and further observed that such alteration of the reserved area must be after notice to the petitioner. It further directed that after hearing the petitioner, a speaking order has to be passed by the Cane Commissioner. With those observations, as the crushing season of 2009-10 had come to an end, the SLP and contempt petition filed by the petitioner came to be dismissed on 4-10-2010. It further directed that after hearing the petitioner, a speaking order has to be passed by the Cane Commissioner. With those observations, as the crushing season of 2009-10 had come to an end, the SLP and contempt petition filed by the petitioner came to be dismissed on 4-10-2010. During the pendency of the above SLP before the Apex Court, the petitioner had initiated a proceedings to avoid any hardship to the farming community and requested them to come forward and register their sugarcane well in advance for the sugar season 2010-11 by the order dated 26/6/2010 and subsequently on 3/8/2010, in order to start crushing operations at the earliest. The Hospet Raitara Sangha in reply virtually refused to register the sugarcane and made allegations against the petitioner. Thereafter a meeting was called by the Honourable Minister for sugar on 27/8/2010 to resolve the issue between the petitioner and the sugarcane growers of the reserved area of the petitioner. On 25/10/2010 petitioner addressed a letter to the Assistant Commissioner, Hospet, informing him that they would take up the crushing operations immediately for the sugar season 2010-11 and they have made arrangements and plant and machinery are ready. 11. By a letter dated 18/10/2010 the Cane Commissioner called upon the Deputy Commissioner to find out whether the petitioner is capable of crushing the sugarcane of its reserved area and if not, to make alternative arrangement to dispose of the sugarcane to other sugar factories. The same was seriously objected by the petitioner. Through their advocate they sent a notice taking serious exceptions to the said directions. The petitioner was ready and willing to crush all the sugarcane by paying the price at the rate of Rs.1,500/-per MT and subsequently agreed to pay Rs.1,750/-per MT as was paid by the neighbrouring sugar factories. The Deputy Commissioner prepared a minutes of meeting on 18/11/2010 to the effect that the sugarcane in the reserved area of the petitioner factory was ready for harvesting in the month of August 2010 itself and there was no agreement between the growers of the sugarcane and the petitioner to crush all the sugarcane before March 2011 and has to pay the sugarcane price on par with the neighbouring factories and to pay harvesting and transportation charges. On the basis of the said minutes and also on the basis of the local political pressure the 1st respondent without issuing notice to the petitioner passed an order dated 26/11/2010 as per Annexure-A to the writ petition and ordered that petitioner factory has to crush 2 lakh MT of sugarcane and the balance of 2 lakhs MT of sugarcane to be permitted to be supplied to the neighbouring factories by issuing permits to the growers of the sugarcane of the reserved area. Challenging the said order W.P.No.68780/2010 was filed. Though initially only respondents 1 and 2 were made parties, Tungabhadra Sugarcane and Banana Growers Society impleaded themselves as 3rd respondent and the Deputy Commissioner of Bellary was impleaded as 4th respondent. On 2/12/2010 after impleading the Sangha and after hearing them and all the parties, an interim order came to be passed directing the petitioners to start crushing within one week from the date of order. The Deputy Commissioner was also directed to pass an order within three days from the date of the order specifying the area from which 2 lakhs MT sugarcane will be supplied to the petitioner in terms of the order dated 26/11/2010 and that the petitioner shall comply with the provisions of the order and Annexure-B and C to the writ petition. Again by an order dated 15/12/2010 earlier order was modified by permitting the petitioner to start crushing from 15/12/2010. In all other respects the earlier order remained in tact. It is during the pendency of the writ petition when the order impugned in the writ petition was withdrawn, a memo came to be filed on 12/1/2011 and accordingly this writ petition came to be dismissed. Challenging the order withdrawing this order i.e., order dated 15.12.2010 the present writ petitions are filed. 12. The grievance of the 3rd respondent/sugarcane growers in these petitions is that in spite of issuing permits to the members of the society, the Government Order dated 26/11/2010 was rescinded in a most arbitrary manner. The said order is passed without, any application of mind on nonexistent grounds and behind the back of the 3rd respondent. Therefore they wanted the said order to be set aside. They contend, the order passed on 26/11/2010 is after considering their representations and others. It was based on contractual factual matters and after consideration of the reports of the responsible officer. Therefore they wanted the said order to be set aside. They contend, the order passed on 26/11/2010 is after considering their representations and others. It was based on contractual factual matters and after consideration of the reports of the responsible officer. The reason for the said order is that the petitioner was not entering into agreement with the farmers as required in the law. The 75 years crushing report of the petitioner indicates that average maximum crushing has been about 1,115.2 TCD whereas the cane cultivated on about 11.000 acres to 11.500 acres yields about 3,85,000 tons to 4,02,500 tons and hence the petitioner is not able to crush all the cane that is available in the cane command area. The machinery and equipment of the petitioner are old and rather out dated. The crushing incapacity and the crushing operations pattern of the petitioner results in reducing cane sucrose contents and therefore they wanted the said order to be set aside. It is not in dispute that before passing the said order the 3rd respondent society or the farmers were not heard. 13. Therefore if the order is to be set aside on the ground of violation of principles of natural justice, the earlier order dated 26-11-2010 would come to life and consequently the writ petition filed challenging that order has to be decided by this Court on merits and in accordance with law. That is how, the matters are clubbed together and taken up for consideration. 14. The learned counsel appearing for the petitioner assailing the impugned order dated 26/11/2010 contends that the facts stated in the impugned order are factually incorrect. When once cane growing area is earmarked by the Government, in respect of a sugar factory, the said sugar factory is entitled to the cane which is grown in the said area. The Government has no power to reduce the quantum of sugarcane to be supplied to the said factory under the provisions of the order. When the petitioner has the capacity to crush 4 lakh tons of sugarcane; impugned order passed to restrict the crushing to only 2 lakh tons and directing the Deputy Commissioner to grant permits for export of the remaining 2 lakh tons of sugarcane to the neighbouring sugar factories is illegal and requires to be set aside. That apart before passing that order petitioner has not been heard. That apart before passing that order petitioner has not been heard. Therefore said order is in violation of principles of natural justice and liable to be set aside. The 3rd respondent society has no locus-standi in as much as there is no agreement between the petitioner and the society for supply of any sugarcane. In fact it is at the instance of the society that orders are passed. On that ground the impugned order is liable to be set aside. 15. Per contra the learned counsel appearing for the society contends, material on record discloses that petitioner at no point of time has crushed sugarcane to the full extent grown in the area earmarked for the petitioner factory. The material on record also discloses that they do not start the crushing operations in October. November and they start only in the month of January, February. They have no capacity to crush 4 lakh MT of sugarcane. That apart they have not paid the agreed price under contract. Huge arrears are due by the petitioner to the farmers. Unless they pay the arrears, the petitioner is not entitled to any further sugarcane for its crushing operations. When the petitioner is not prompt in paying the agreed price, the farmers cannot be compelled to supply sugarcane to the petitioner. It is in that context the impugned order came to be passed keeping in mind the interest of the petitioner as well as the farmers, wherein 2 lakh MT sugarcane is to be supplied to the petitioner and the remaining 2 lakh MT could be exported by issue of permits and therefore he submits that order passed by the Government is equitable order and do not call for any interference. They also contend, by the impugned order the area which is earmarked for the petitioner company is not reduced and therefore it cannot be said that they are the aggrieved persons. By the impugned order what is sought to be done is to direct the Deputy Commissioner to issue permits to farmers for export of sugarcane grown from that area which is in excess of the capacity of the petitioner's crushing capacity and therefore they submit that impugned order is valid. In fact before passing that order there were several rounds of negotiations between the parties, several notices were issued to the petitioner. In fact before passing that order there were several rounds of negotiations between the parties, several notices were issued to the petitioner. Petitioners also have made representations and therefore it is too late in the day for them to contend that impugned order passed is in violation of principles of natural justice and behind them in clandestine manner. In fact material on record discloses that Deputy Commissioner directed the Assistant Commissioner to conduct an enquiry and in pursuance of the same the Assistant Commissioner issued notice to the petitioner, called upon him to produce documents and to have a say in the matter. It is only on consideration of all the materials the impugned order has been passed. Therefore no exception could be taken to the impugned order and no case for interference is made out. 16. In the light of the aforesaid facts set out and the rival contentions raised it is clear that in the recent past every year there is a dispute between the petitioner and the farmers in the reserved area. The dispute is regarding the rate of sugarcane which is to be supplied and also regarding payment of arrears. Authorities are passing orders from time to time. Political leaders are also intervening in the matter. Government also has stepped in. But one thing is clear that all these actions are in the nature of stop gap arrangement every year, without keeping in mind the legal provisions governing the parties and no attempt is made to resolve this dispute within the four corners of law. That is why inspite of writ petition and Apex Court order, the disputes have remained unresolved. It is under these circumstances, as it is clear from the reference order, the learned single Judge felt, it is time that some of the relevant provisions are interpreted by this Court, so that it would act as a guidance to the farmers and to the sugar factory as well as to the Government so that regular litigation of this nature getting repeated every year could be avoided. Therefore before we go into the merits of the case it is necessary to refer to the aforesaid provisions and find out what was the object with which these provisions have been enacted. 17. Therefore before we go into the merits of the case it is necessary to refer to the aforesaid provisions and find out what was the object with which these provisions have been enacted. 17. In exercise of the powers conferred under Section 3 of the Essential Commodities Act 1955, the Central Government has made Sugarcane Control Order 1966, which defines the factory, price, producer of sugar, reserved area and the year. Section 3(d) deals with minimum price payable to the sugarcane, which reads as under: 3. Minimum price of sugarcane payable by producer of sugar-(1) The Central Government may, after consultation with such authorities, bodies or associations as it may deem fit. by notification in the Official Gazetteer, from time to time, fix the minimum price of sugarcane to be paid by producers of sugar or their agents for the sugarcane purchased by them having regard to - (a) the cost of production of sugarcane; (b) the return to the grower from alternative crops and the general trend of prices of agricultural commodities; (c) the availability of sugar to the consumer at a fair price; (d) the price at which sugar produced from sugarcane is sold by producers of sugar; and (e) the recovery of sugar from sugarcane: [Provided that the Central government or with the approval of the Central Government, the State Government, may in such circumstances and subject to such conditions as specified in Clause 3-A, allow a suitable rebate in the price so fixed]. [Explanation.-(1) Different prices may be fixed for different areas or different qualities or varieties of sugarcane. .(2) When a sugar factory produces ethanol directly from sugarcane juice or B-Heavy molasses, the recovery rate in case of such sugar factory shall be determined by considering every 600 litres of ethanol so produced as equivalent to 1 tonne of production of sugar: .(3) Production of ethanol directly from sugarcane juice shall be allowed in case of sugar factories only]. .(2) No person shall sell or agree to sell sugarcane to a producer of sugar or his agent, and no such producer or agent shall purchase or agree to purchase sugarcane, at a price lower than that fixed under sub-clause (1). .(2) No person shall sell or agree to sell sugarcane to a producer of sugar or his agent, and no such producer or agent shall purchase or agree to purchase sugarcane, at a price lower than that fixed under sub-clause (1). .(3) Where a producer of sugar purchases any sugarcane from a grower of sugarcane or from a sugarcane growers' co-operative society, the producer shall, unless there is an agreement in writing to the contrary between the parties, pay within fourteen days from the date of delivery of the sugarcane to the seller or tender to him the price of the cane sold at the rate agreed to between the producer and the sugarcane grower or the sugarcane growers co-operative society or that fixed under sub-clause(1), as the case may be, either at the gate of the factory or at the cane collection centre or transfer or deposit the necessary amount in the Bank account of the seller or the cooperative society, as the case may be. [(3-A) Where a producer of sugar or his agent fails to make payment for the sugarcane purchased within 14 days of the date of delivery he shall pay interest on the amount due at the rate of 15 per cent per annum for the period of such delay beyond 14 days. Where payment of interest on delayed payment is made to a cane growers' society, the society shall pass on the interest to the cane growers concerned after deducting administrative charges, if any, permitted by the rules of the said society. .(4) Where sugarcane is purchased through an agent, the producer or the agent shall pay or tender payment of such price within the period and in the manner aforesaid and if neither of them has so paid or tendered payment, each of them shall be deemed to have contravened the provisions of this clause. .(5) At the time of payment at the gate of the factory or at the cane collection centre, receipts, if any, given by the purchaser, shall be surrendered by the cane grower or cooperative society. .(6) Where payment has been made by transfer or deposit of the amount to the Bank account of the seller or the co-operative society, as the case may be, the receipt given by the purchaser, if any, to the grower or the co-operative society if not returned to the purchaser, shall become invalid. .(6) Where payment has been made by transfer or deposit of the amount to the Bank account of the seller or the co-operative society, as the case may be, the receipt given by the purchaser, if any, to the grower or the co-operative society if not returned to the purchaser, shall become invalid. .(7) In case, the price of the sugarcane remains unpaid on the last day of the sugar year in which cane supply was made to the factory on account of the suppliers of cane not coming forward with their claims therefor [x x x x x]. It shall be deposited by the producer of sugar with the Collector of the district in which the factory is situated, within three months of the close of the sugar year. The Collector shall pay, out of the amount so deposited, all claims considered payable by him and preferred before him within three years of the close of the sugar year in which the cane was supplied to the factory. The amount still remaining undisbursed with the Collector, after meeting the claims from the suppliers, shall be credited by him to the Consolidated Fund of the State, immediately after the expiry of the time limit of 3 years within which claims therefore could be preferred by the suppliers. The State Government shall, as far as possible utilise such amounts for development of sugarcane in the State]. The State Government shall, as far as possible utilise such amounts for development of sugarcane in the State]. .(8) Where any producer of sugar or his agent has defaulted in furnishing information under Clause 9 of this Order or has defaulted in paying the whole or any part of the price of sugarcane to a grower of sugarcane or a sugarcane growers co-operative society within fourteen days from the date of delivery of sugarcane, or where there is an agreement in writing between the parties for payment of price within a specified time and any producer or his agent has defaulted in making payment within the agreed time specified therein, the Central Government or an officer authorised by the Central Government in this behalf or the State Government or an officer authorised by the State Government in this behalf may either on the basis of information made available by the producer of sugar or his agent or on the basis of claims, if any, made to it or him regarding nonpayment of prices or arrears thereof by the concerned grower of sugarcane or the sugarcane growers co-operative society as the case may be, or on the basis of such enquiry that it or he deems fit, shall forward to the Collector of the district in which the factory is located, a certificate specifying the amount of price of sugarcane and interest due thereon from the producer of sugar or his agent for its recovery as arrears of the land revenue. .(9) The Collector on receipt of such certificate, shall proceed to recover from such producer of sugar or his agent the amount specified therein as if it were arrears of land revenue. (10) After effecting the recovery, the collector shall intimate to the concerned growers of the sugarcane or the concerned sugarcane growers co-operative societies through a public notice to submit their claims in such a manner as he considers appropriate within thirty days: Provided that the Collector may, for the reason to be recorded in writing allow the submission of claims after the period so specified if he is satisfied that there was sufficient cause for not submitting such claim earlier. .(11) If the amount recovered is less than the amount specified in the certificate under sub-clause (8), the Collector shall distribute the amount so recovered among the concerned growers of the sugarcane or the concerned sugarcane growers cooperatives in proportion to the ratio determined by the Collector on the basis of the sugarcane supplied by the concerned growers of sugarcane or the sugarcane growers' cooperative society as the case may be. .(12) If the amount recovered and distributed under sub-clause (11) is less than the amount specified in the certificate under sub-clause (8), the Collector shall proceed to recover the remaining amount, as if it were arrears of land revenue till the full amount is recovered and distributed to satisfy the remaining claims. .(13) If the amount is given to the concerned sugarcane growers co-operative societies, it shall distribute the amount through cheque/draft/or any other recognised banking instrument on any Scheduled Bank to the concerned sugarcane growers within ten days of the receipt of the amount from the Collector. .(14) If the concerned sugarcane grower or the concerned sugarcane growers cooperative society do not come forward to claim or collect the amount so recovered by the Collector within three years from the date of the public note referred to in sub-clause (10), the unclaimed amount shall be deposited by the Collector in the Consolidated Fund of the State]. 18. Clause 3-A deals with rebate that could be deducted from the price paid for sugarcane. However by an order dated 22/10/2009 the said order is amended. It reads as under: MINISTRY OF CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION (Department of food and Public Distribution) ORDER New Delhi, the 22nd October, 2009 S.O.2665(E)/Ess. Com./Slugarcane:-In exercise of the powers conferred by section 3 of the Essential Commodities Act. 1955 (10 of 1955), the Central Government hereby makes the following Order further to amend the Sugarcane (Control) Order, 1966, namely 1 (1) The Order may be called the Sugarcane (Control) Amendment Order, 2009. (2) It shall come into force on the date of its publication in the Official Gazettee. 2. 1955 (10 of 1955), the Central Government hereby makes the following Order further to amend the Sugarcane (Control) Order, 1966, namely 1 (1) The Order may be called the Sugarcane (Control) Amendment Order, 2009. (2) It shall come into force on the date of its publication in the Official Gazettee. 2. In the Sugarcane (Control) Order, 1966 .(a) for the words 'minimum price", wherever they occur, the words "fair and remunerative price" shall be substituted: .(b) in clause 2, after sub-clause (c), the following sub-clause shall be inserted, namely: .(cc) “fair and remunerative price of sugarcane" means the price fixed by the central Government under clause 3, from time to time, for sugarcane; .(c) in clause 3, in sub-clause (1), after item (f), the following item shall be inserted, namely:- .(g) “reasonable margins for the growers of sugarcane on account of risk and profits"; .(d) after clause 3A, the following clause shall be inserted, namely; "3B Price of sugarcane fixed above the fair and remunerative price. If any authority or State government fixes any price above the fair and remunerative price fixed by the Central government under clause 3, Such authority or State Government, shall pay the amount, which it fixes above the fair and remunerative price as fixed by the Central government, to the grower of sugarcane or to the sugarcane growers' cooperative society, as the case may be". .(e) clause 5A shall be omitted. .(f) The Second Scheduled shall be omitted. [F.No.3-4/2009-SP-II] N. SANYAL. Jt. Secy. 19. Clause 6 deals with power to regulate, distribute and movement of the sugarcane which reads as under: 6. .(e) clause 5A shall be omitted. .(f) The Second Scheduled shall be omitted. [F.No.3-4/2009-SP-II] N. SANYAL. Jt. Secy. 19. Clause 6 deals with power to regulate, distribute and movement of the sugarcane which reads as under: 6. Power to regulate distribution and movement of sugarcane -(1) The government may, by order notified in the Official Gazettee- .(a) reserve any area Where sugarcane is grown (hereinafter in this clause referred to as 'reserved area') for a factory having regard to the crushing capacity of the factory, the availability of sugarcane in the reserved area and the need for production of sugar, with a view to enabling the factory to purchase the quantity of sugarcane required by it: .(b) determine the quantity of sugarcane which a factory will require for crushing during any year: .(c) fix with respect to any specified sugarcane grower or sugarcane grower or sugarcane growers generally in a reserved area, the quantity or percentage of sugarcane grown by such grower or growers, as the case may be, which each such grower by himself, or, if he is a member of a co-operative society of sugarcane growers operating in the reserved area, through such society, shall supply to the factory concerned: .(d) direct a sugarcane grower or a sugarcane growers' co-operative society supplying sugarcane to a factory, and the factory concerned to enter into an agreement to supply or purchase, as the case may be, the quantity of sugarcane fixed under paragraph(c): .(e) direct that no.2[x x x x x] khandsari sugar or sugar shall be manufactured from sugarcane except under and in accordance with the conditions specified in the licence issued in this behalf; .(f) prohibit or restrict or otherwise regulate the export of sugarcane from any area (including a reserved area) except under and in accordance with a permit issued in this behalf. .(2) Every sugarcane grower, sugarcane growers' co-operative society and factory, to whom or to which an order made under paragraph (c) of sub-clause (1) applies, shall be bound to supply or purchase, as the case may be, that quantity of sugarcane covered by the agreement entered into under the paragraph and any willful failure on the part of the sugarcane grower, sugarcane growers' co-operative or the factory to do so, shall constitute a breach of the provisions of this Order: Provided that where the default committed by any sugarcane growers' co-operative society is due to any failure on the part of any sugarcane grower, being a member of such society, such society shall not be bound to make supplies of sugarcane to the factory to the extent of such default. 20. The Constitution Bench of the Apex Court in the case of UP Co-operative Cane Unions Federation versus West UP Sugar Mills Association and others at paragraph 118 and 119 have set out the object behind these provisions. It reads as under: 118.) A Sugar factory normally runs in shifts for the whole day during the crushing season and it needs a continuous supply of freshly harvested sugarcane according to its daily crushing capacity which should be spread over the entire crushing season of about six months. The U.P. Sugarcane (Regulation Supply and Purchase) Act, 1953; V.P. Sugarcane (Regulation of Supply and Purchase) Rules, 1954 and the U.P. Sugarcane Supply and Purchase Order, 1954, have been made to achieve that object. Any shortfall in supply of sugarcane to sugar factory will seriously affect its production resulting in huge losses. Therefore, the first and foremost requirement for the profitable running of the sugar factor is that it should get adequate quantity of sugarcane everyday throughout the crushing season and for ensuring this, a system of reserving or assigning an area in favour of sugar factory has been evolved under S. 15 of the Act. The reservation of an area ensures the supply of the entire sugarcane grown therein in the factory in whose favour it has been reserved. Similarly the assignment of an area ensures the supply of such quantity of sugarcane to the factory in whose favour it has been assigned as may be determined by the Cane Commissioner. The reservation of an area ensures the supply of the entire sugarcane grown therein in the factory in whose favour it has been reserved. Similarly the assignment of an area ensures the supply of such quantity of sugarcane to the factory in whose favour it has been assigned as may be determined by the Cane Commissioner. Another advantage to the sugar factory is that sugarcane from its reserved or assigned area cannot be sold to any other factory in the vicinity even if it offers a higher price to a grower. This arrangement does not allow the market forces to operate and thereby completely avoids competition amongst the sugar factories which could lead to escalation in prices, it is common knowledge that every sugar factory is keen to have the maximum area reserved to assigned for it so that it may get adequate raw material. Sugarcane requires a particular type of soil and climatic condition and cannot be grown everywhere. The sugar factories are established in the sugar producing belt in close proximity with each other and very often there are competing claims for reservation or assignment, of an area. In their favour, it is for this reason that an appeal is provided under S.15 (4) of the Act against an order made under S.15(1) of the Act by the Cane Commissioner reserving or assigning an area in favour of sugar factory. Once an area is reserved in favour of a factory the cane grower in the said area or the cane growers co-operative society operating therein gets tied to that factory and has to compulsorily enter into an agreement in prescribed form (Form-B or Form-C) given in the Appendix to 1954 Order. In view of Claimant.5 of the said order cane grown in the reserved or assigned area cannot be purchased by anyone without the previous issue of requisition slips and identification cards to the growers by the occupier of the factory and in the case of members of the factory and in the case of members of the factory and in the case of members of the cane grower's co-operative society by such society. Since the requisition slips are non-transferable and they are issued by the sugar factory according toits requirement of sugarcane. It thereby completely controls the purchase of sugarcane from a reserved or assigned area. Since the requisition slips are non-transferable and they are issued by the sugar factory according toits requirement of sugarcane. It thereby completely controls the purchase of sugarcane from a reserved or assigned area. The terms of the agreement in Form-B and Form-C are also quite stringent as in the event of failure to supply at least eighty-five per cent of the agreed quantity of sugarcane the cane grower or the cane growers' co-operative society has to pay compensation. Even in the event of a breakdown in the factory or its inability to purchase due to calamities or circumstances beyond human control, the cane grower or the cane grower's co-operative society is not at liberty to make any other arrangement for disposal of cane except after giving a week's notice to the factory and obtaining prior permission of the Cane Commissioner. Here too no compensation is payable by the factory to the cane grower or the cane growers' cooperative society for the loss which, may be suffered on this account. 119.) The provisions referred to above have been made for the benefit of the sugar factory so that it is assured of and gets a continuous supply of freshly harvested sugarcane in quantity according to its crushing capacity and for the whole duration of the crushing season. No doubt the cane grower also gets some advantage in the sense that purchase of his yield is assured but at the same time many limitations and restrictions are imposed upon him. In view of the aforesaid statutory provisions, the position of a cane grower becomes entire different from that of a farmer producing any other kind of agricultural crop where there are absolutely no restrictions upon him. He is at absolute liberty to harvest his crop at his convenience without being dictated by a third party, to sell it to anyone whomsoever he likes and whenever he wants. It is in this scenario, which is not the creation of the cane grower but of the statutory provisions operating in the field that we have to examine the question whether the State has any authority or power to fix the price of the sugarcane supplied to a producer of sugarcane supplied to a producer of sugar (sugar factory). 21. It is in this scenario, which is not the creation of the cane grower but of the statutory provisions operating in the field that we have to examine the question whether the State has any authority or power to fix the price of the sugarcane supplied to a producer of sugarcane supplied to a producer of sugar (sugar factory). 21. Therefore it is clear that the minimum price of sugarcane is to be prescribed by the CentralGovernment by notification in the official gazette from time to time. The word ‘minimum price' has now been substituted with 'fair and remunerative price'. The statute fixes the price of sugarcane. Parties by agreement cannot reduce this price. However there is no prohibition in law for the parties by agreement fixing the price of sugarcane over and above the price fixed by the Central Government. Section 3A deals with rebate. However the most important clause is, Clause 6. The Central Government by a notification in the official gazette can reserve any area where sugarcane is grown for a factory having regard to the crushing capacity of the factory based on the availability of sugarcane in the reserved area and the need for production of sugar with a view to enable the factory to purchase the quantity of sugarcane required by it. By a notification the said power is delegated by the Central Government to the respective State Governments. Accordingly, the Central Govern-ment/State Government would determine the quantity of sugarcane which a factory will require for crushing during the year and fix the quantity or percentage of sugarcane grown by such grower or grower in the reserve area which would be supplied to the factory concerned. It also has the power to direct the sugarcane grower or a sugarcane growers co-operative society to supply sugarcane to a factory and the factory concerned has to enter into an agreement to supply or purchase as the case may be, the quantity of sugarcane fixed by the Government. It also has been vested with the power to prohibit or restrict or otherwise regulate the export of sugarcane from the area including the reserved area except under and in accordance with the permit issued in this behalf. Sub-Clause (2) of Clause 6 makes it very clear that if the aforesaid provisions are contravened, by any of the parties, it shall constitute a breach of the provisions of the order. Sub-Clause (2) of Clause 6 makes it very clear that if the aforesaid provisions are contravened, by any of the parties, it shall constitute a breach of the provisions of the order. 22. By virtue of the power conferred under Clause 6,7,8 and 9 of the control order the Government of Karnataka has passed the Sugarcane Regulation of Distribution (Hospet) Order 1974 (hereinafter referred to as 'Hospet Order' for short). Clause 3 of the said order provides for determination of the quantity of sugarcane required by the factory and reservation of the area for supply of sugarcane. The crushing capacity of the petitioner had been fixed 1,500 tons per day, as the quantity of sugarcane required by the factory during the year shall be about 2,40,000 tons. The said order also directs that the factory shall secure the sugarcane determined under Sub-Clause (1) of Clause 3 from the area specified under Schedule-1 to the said order which shall be the reserved area for supply of sugarcane to the factory. Under Schedule-I to the said Hospet Order 33 villages in Hospet Taluka and 36 villages in Hagaribommanahalli Taluka have been reserved for the petitioner factory. Clause 4 deals with fixation of quantity of sugarcane to be supplied to the factory. It provides that every grower of sugarcane in the reserved area shall supply to the factory 95% of the sugarcane grown by each such grower by himself or if he is a member of the sugarcane growers society, operating in the reserved area through such society. Therefore it is mandatory for sugarcane growers in the reserved area of the petitioner factory to supply 95% of the sugarcane grown by them as this provision, is mandatory. Clause 5 provides for an agreement to supply and purchase the determined quantity of sugarcane. It provides that every grower of sugarcane or co-operative societies supplying sugarcane to the factory has to enter into an agreement for supply or purchase as the case may be, the quantity of sugarcane determined under Clause 4. Therefore an obligation is cast upon the parties to enter in to an agreement stipulating the quantity of sugarcane to be sold or purchased and no discretion is given to either of the parties not to enter into such an agreement. 23. Therefore an obligation is cast upon the parties to enter in to an agreement stipulating the quantity of sugarcane to be sold or purchased and no discretion is given to either of the parties not to enter into such an agreement. 23. If either of the parties want to have the benefit of these orders, then entering into such an agreement is a condition precedent. If such an agreement is not entered into, either of the party cannot claim any right conferred on them under the provisions of these orders. Clause 6 speaks about the prohibition of export of sugarcane from reserved area. No sugarcane shall be exported from the reserved area except under and in accordance with the conditions of permits issued by the Deputy Commissioner in Form No.1 of Schedule-II. The way the said clause is couched i.e., in the negative form would indicate that the said provision is mandatory. The sugarcane from the reserved area shall not be exported. If export is to be done, a permit by the Deputy Commissioner in the prescribed form is a must. Without such permit no sugarcane grown in the reserved area could be exported by the sugarcane growers. If a sugarcane grower wants permit for exporting the sugarcane grown in the reserved area, he has to make an application in the prescribed form and the export of sugarcane should be strictly in accordance with the terms of the permit so to be issued. If there is a violation of the terms of the permit consequences such as forfeiture of the amount deposited as security as provided for in Sub-Clause (2) of Clause 7 would follow. 24. A reading of aforesaid provisions of the Hospet Order along with Clause 6 of the control order makes it clear that said provisions have been made for the benefit of sugar factory, so that it is assured of and gets freshly harvested sugarcane in quantity according to its crushing capacity and for the whole term of crushing season. The cane grower also gets advantage in the sense that purchase of his yield is assured but at the same time many limitations and restrictions are imposed upon grower. In view of the aforesaid statutory provisions the position of a cane grower becomes entirely different from that of any other agricultural producer or grower, wherein there are absolutely no restrictions upon him. In view of the aforesaid statutory provisions the position of a cane grower becomes entirely different from that of any other agricultural producer or grower, wherein there are absolutely no restrictions upon him. There he has absolute liberty to harvest his crop at his convenience without being injuncted by the 3rd party to sell it to any one he likes and whenever he wants. But in the case of sugarcane growers, such a freedom and liberty is not conferred to extent of area reserved, because of the statutory provisions operating in the field and such a freedom is curtailed to the extent as provided in these orders referred to supra. It is only when he has complied with the terms of the order and enters into an agreement with the sugar factory, and ready and willing to supply sugarcane and has supplied sugarcane to the sugar factory, commits no breach of the terms of the agreement, or the statutory provisions he would have a right to export the sugarcane grown outside the reserved area. Even then he is not absolutely free, he has to obtain a prior permission of the Deputy Commissioner and it is only on such permission being granted and subject to the stipulations contained in the said permit he is permitted to export, the cane grown by him. As the constitutional validity of these provisions are not under challenge, as these provisions stand, full effect is to be given effect to the same. 25. The underlying principle behind these orders is based on public policy and public interest. The first and foremost requirement for the profitable running of the sugar factory is that it should get adequate quantity of sugarcane everyday throughout the crushing season and for ensuring this, a system of reserving or assigning an area in favour of sugar factory has been evolved. The reservation of an area ensures the supply of the entire sugarcane grown therein in the factory in whose favour it has been reserved. Similarly the assignment of an area ensures the supply of such quantity of sugarcane to the factory in whose favour it has been assigned. Sugarcane from its reserved or assigned area cannot be sold to any other factory in the vicinity even if it offers a higher price to a grower. Similarly the assignment of an area ensures the supply of such quantity of sugarcane to the factory in whose favour it has been assigned. Sugarcane from its reserved or assigned area cannot be sold to any other factory in the vicinity even if it offers a higher price to a grower. This arrangement does not allow the market forces to operate and thereby completely avoids competition amongst the sugar factories which could lead to escalation in prices. Once an area is reserved in favour of a factory the cane grower in the said area or the cane growers cooperative society operating therein gets tied to that factory and has to compulsorily enter into an agreement in prescribed form. Cane grown in the reserved or assigned area cannot be purchased by anyone without the previous permission of the Deputy Commissioner. Even in the event of a breakdown in the factory or its inability to purchase due to calamities or circumstances beyond human control, the cane grower or the cane grower's co-operative society is not at liberty to make any other arrangement for disposal of cane except after giving a week's notice to the factory and obtaining prior permission of the Cane Commissioner. The provisions referred to above have been made for the benefit of the sugar factory so that it is assured of and gets a continuous supply of freshly harvested sugarcane in quantity according to its crushing capacity and for the whole duration of the crushing season. No doubt the cane grower also gets some advantage in the sense that purchase of his yield is assured but at the same time many limitations and restrictions are imposed upon him. In view of the aforesaid statutory provisions, the position of a cane grower becomes entirely different from that of a farmer producing any other kind of agricultural crop where there are absolutely no restrictions upon him. 26. In fact when the Government was satisfied that the cane grown in the villages in the reserved area earmarked for the petitioner is not sufficient and having regard to the crushing capacity of the petitioner and on their request they passed another order in the year 1998 adding another 19 villages from Koppal Taluka to the already reserved area. 26. In fact when the Government was satisfied that the cane grown in the villages in the reserved area earmarked for the petitioner is not sufficient and having regard to the crushing capacity of the petitioner and on their request they passed another order in the year 1998 adding another 19 villages from Koppal Taluka to the already reserved area. Subsequently in supersession of the Government Order dated 4/5/1998, Government Order dated 28/8/2006 is passed, in which the crushing capacity of the petitioner was recognized as 2,000 TCD and the quantity of sugarcane required by the factory during the year was held to be about 3.6 lakhs MT to 4 lakhs MT. In all other respects the earlier clauses in the order was retained except to the extent of adding the word ‘temporary’ in respect of the newly added areas. From these undisputed material on record it is clear that sanctioned crushing capacity of the petitioner is 4 lakhs MT per year. It is in the background of the statutory provisions as well as the undisputed facts, we have to resolve the dispute between the parties in these cases. 27. The aforesaid material on record discloses that as on today the total requirement of cane for the petitioner company is around 4 lakhs MT. 4 lakhs MT of sugarcane is grown in the reserved area. The sugarcane growers are legally bound to supply 95% of the sugarcane grown by them, to the petitioner. They are under a statutory obligation to enter into an agreement with the petitioner for supply of the said sugarcane. Insofar as the price at which the sugarcane is to be supplied is concerned. Central Government is the authority which fixes sugarcane prices every year. Over and above the said price fixed by the Central Government, the parties by agreement can fix a price which is higher than the price fixed by the Central Government. The crushing season normally starts in the month of October-November of each year. By that time the fully grown sugarcane should start coming to the sugar factory. The normal life of a sugarcane crop is between 10-12 months. The crushing season normally starts in the month of October-November of each year. By that time the fully grown sugarcane should start coming to the sugar factory. The normal life of a sugarcane crop is between 10-12 months. Therefore sugarcane growers have to enter into an agreement with the sugar factory well in advance giving the date on which they have planted the sugarcane, so that sugar factory is able to fix a schedule both for supply of sugarcane as well as for harvest and crushing. 28. These farmers are not willing to enter into agreement unless the sugarcane price is mutually agreed upon. Because of the delay in entering into such agreement and some time due to intervention of the political leaders, petitioner is unable to start its crushing in the month of October-November. Each year it starts in the month of January-February. Under those circumstances the contention of the farmers that the petitioner has no crushing capacity, they don't commence the factory well in time and they cannot wait for them to start crushing, is without any substance. If the crushing activity commences in October or November and if the farmers have entered into an agreement much earlier to the said period and if the sugarcane supplied by them is not received by the factory or having been received, the payment is not made, then it could be said that the sugar factory has committed breach of the order and they are liable for the consequences flowing from such breach. But when the farmers have not entered into agreement, not supplied the sugarcane, it is not open to them to complain against the factory. 29. It is in this background we would like to dispel some confusion or doubt in the mind of the authorities as well as parties are concerned. The power of the Government to earmark a particular area as sugarcane growing area for a particular factory is different from the power to permit sugarcane growers in the reserved area from exporting the excess sugarcane which is not utilized by the factory which is situated in the said reserved area. The power of the Government to earmark a particular area as sugarcane growing area for a particular factory is different from the power to permit sugarcane growers in the reserved area from exporting the excess sugarcane which is not utilized by the factory which is situated in the said reserved area. Under Clause 6 of the order a power is conferred on the Central Government which by delegation is conferred on the State Government, to reserve any area where sugarcane is grown for a factory having regard to its crushing capacity and the availability of sugarcane in the reserved area and need for production of sugarcane with a view to enabling the factory to purchase that quantity of sugarcane required to it. Once the power is exercised and an area is reserved, the factory which is set up on the basis of that assurance the assured continuous supply of sugarcane to the factory should follow. If for any reason that area is to be curtailed / reduced, the aggrieved person will be the factory. Without hearing the factory, without affording a reasonable opportunity to them the said power cannot be exercised to reduce the area. In fact in the instant case the area earmarked in the year 1979 was not sufficient or adequate. Therefore, on a request made by the factory in the year 1998, additional area was included to the reserved area. When that being the case, if the area earmarked or reserved for the petitioner is to be reduced, they must be heard before such an order is passed. However this reduction of the reserved area is nothing to do with the grant of permit to export sugarcane grown in the reserved area. Once an area is reserved and the cane is grown, in any particular year, if the factory is not able to crush the entire sugarcane grown, it is in those circumstances provision is made for export of that excess sugarcane by granting permits. The permit to be granted is only for that particular year when the sugarcane grown is in excess and the factory situated in the reserved area is unable to crush the same. That is a power which is conferred on the Deputy Commissioner by the State. The permit to be granted is only for that particular year when the sugarcane grown is in excess and the factory situated in the reserved area is unable to crush the same. That is a power which is conferred on the Deputy Commissioner by the State. But the Deputy Commissioner has no power to reduce the reserved area which is reserved by the State Government by virtue of the power conferred under Clause-6. Even in respect of grant of permits to export sugarcane, such an export would effect the existing factory in the reserved area. Before such export is permitted by issue of a permit, the factory is to be heard. They should be notified. Only after hearing them, a permit could be issued. Therefore it is of utmost importance for the authorities to note even in case of grant, of permits, they have no absolute power and the power to issue permit is to be exercised in a fair manner by following the principles of natural justice, that is by hearing the petitioner factory, before any such permit is granted. 30. In the instant case, the Government has passed an order directing the Deputy Commissioner to permit the sugarcane growers to export 2 lakhs MT of sugarcane grown in the reserved area. Before passing that order the petitioner was not notified of the proposed action. May be because of the pending dispute between the parties, negotiations took place, enquiry conducted, petitioner furnished information, and all this is done for the purpose of resolving the dispute between them namely, payment of arrears of sugarcane price, fixing of sugarcane, etc., At no point of time it was contemplated by the authority to permit export of sugarcane on the ground that the crushing capacity of the petitioner is only 2 lakh tons when 4 lakh tons is available in the reserved area. Therefore if the authorities want to permit export of 2 lakh tons of sugarcane grown in the area, they must issue a notice to the petitioner or factories similarly placed by specifically stating the proposed action and reasons therein so that the petitioner would tile its counter, meet the case and then try to show cause that proposed action is inappropriate. Such course is not adopted. Therefore the order dated 26.11.2011 passed is in violation of principles of natural justice and it adversely affects the interest of the petitioner. Such course is not adopted. Therefore the order dated 26.11.2011 passed is in violation of principles of natural justice and it adversely affects the interest of the petitioner. In that view of the matter the impugned order cannot be sustained. 31. In this context we would like to make it very clear that agreement to supply sugarcane is different from the agreement regarding price. Only when the farmer enters into an agreement to sell the sugar cane he would be entitled to the benefit of the Act and the Rules, and can sell his sugarcane grown, outside the reserved area after obtaining the permit. Otherwise he is not entitled to the permit and consequently he cannot, sell the sugar cane grown by him. 32. The learned counsel for the petitioners submitted before the Court that not only they are agreeable to pay the price fixed by the Central Government for the sugarcane grown by the farmers, they will also pay the agreed price under the agreement between the growers and the factory to be entered into after negotiation and in the event of no such agreement, they are agreeable to pay the sugarcane at the rate neighbouring sugar factories are paying to the sugarcane growers. This payment would be made within the stipulated period in law. This submission is placed on record to dispel any apprehension on the part of the sugar cane growers. 33. The material on record discloses that, this recurring problem is the creation of the State Government and its officials. They have to act in such a manner that both the sugar factory as well as sugarcane growers interest are protected. Taking sides would not solve the problem. All the concerned local political leaders should understand that though they are answerable to these cane growers, the resolution of the dispute should be within the four corners of law. Otherwise those actions are liable to be quashed as being contrary to the statutory provisions and as illegal. We get an impression from the way things have gone on for the last couple of years, nobody seems to have respect for the statutory provisions. That is the reason why even after such deliberations, negotiations, meetings, they are unable to resolve the dispute. 34. We get an impression from the way things have gone on for the last couple of years, nobody seems to have respect for the statutory provisions. That is the reason why even after such deliberations, negotiations, meetings, they are unable to resolve the dispute. 34. Having regard to the past experience and the nature of dispute between the parties, we are of the view that the said dispute is either because of misconception of law or on wrong advice. Though these orders are passed, the orders do not spell out under what circumstances the farmers are entitled to request for permits to export the sugarcane grown in the reserved area and they are also not told what are the consequences of not entering into the agreement well in time. Under these circumstances we deem it proper to lay down the guidelines for all the parties to follow, so that the disputes could be minimized. In this regard we are supported by a judgment of High Court of Bombay in the case of Dhyaneshwar Sahakari Sakhar Karkhana Ltd., versus State of Maharashtrawherein the norms for working out the provisions contained in the Maharashtra Sugar Factories (Reservation of Areas and Regulation of Crushing and Sugarcane Supply) Order 1984 was laid down. We also refer to in the judgment of the Apex Court in the case of Maharashtra Rajya Sahakari Sakhar Karkhana Sangh Ltd., and others, etc., versus State of Maharashtra and othersreported in AIR 1998 Supreme Court 1937,where the Apex Court was interpreting Regulation 5 of the supply of sugarcane wherein it has been laid down under what circumstances a permit or officer may allow a sugar factory to purchase cane after supply of cane or cane growers from the areas other than the area reserved for under Clause 3 came to be analysed. Broadly they have laid down the circumstances justifying such permit. We deem it appropriate to adopt the guidelines in the aforesaid two judgments, with appropriate modifications, till the authorities frame rules in this regard, and issue the following directions for compliance: - (1)That the authorities concerned will ensure that no sugar factory enters reserved areas under clause 6 of the 1966 Order of another sugar factory, save and except on the basis of an export permit granted to such factory. .(2) That where a sugar factory has already been allotted adequate sugarcane according to the crushing licence or licences issued from time to time, no application for export permit for additional quantity will be entertained from such sugar factory. .(3) Regulation of Supply of Sugarcane-(2) A permit Officer may allow a sugar factory to purchase cane or to accept supplies of cane from cane growers from areas other than the area reserved for it under clause 3 if he is satisfied that any of the following circumstances exist namely:- .(a) In the event of production of cane in the area reserved for the factory being not adequate for enabling it to reach optimum level of crushing: .(b) In the event of surplus production of cane in the areas reserved for other factories which those factories are not able to crush during the crushing season. .(c) In the event of stoppage of nearby sugar factory due to mechanical break down, labour unrest, lock-out or any other reason. .(d) In the event of cane grower or cane growers from the area reserved for a particular factory declining to supply cane to the said factory on account of any of the following reasons, if found justified by the Permit Officer:- .(i) Non-payment or late payment of cane price by the sugar factory; or .(ii) Non-fulfilment of any of the obligations by the sugar factory arising out of agreement between the cane grower or cane growers and the sugar factory: or (iii) Discrimination by the sugar factory in harvesting of cane and thereby causing loss to the cane grower or the cane growers: Provided that before passing any order under this sub-clause, for any of the reasons, the Permit Officer shall give the parties concerned a reasonable opportunity of being heard in person or through the authorised representative". .(4) That upon an application being made for export permit to the Permit Officer, the latter will dispose of such application within ten working days of the receipt of such application by communicating the decision in respect thereof to the parties concerned. .(5) That an application for export permit will be heard and decided after giving to all the parties affected or likely to be affected an opportunity of being heard. .(6) That the order granting or refusing the export permit will be a speaking order. .(5) That an application for export permit will be heard and decided after giving to all the parties affected or likely to be affected an opportunity of being heard. .(6) That the order granting or refusing the export permit will be a speaking order. .(7) That the export permit granted by the Permit Officer will be effective after an interval of three working days from the date on which the order granting the permit is served on the party affected. .(8) That if the party affected by the export permit files an appeal to the Director of Sugar against the grant of export permit within three working days from the receipt of such order, the stay of the permit will continue till the disposal of the appeal unless the Appellate authority otherwise vacates the stay. It is made clear that these guidelines shall be prospective. It shall come into force from October 2011 season. It does not apply to arrears of dues for the period prior to October 2011 season. 35. For the reasons aforesaid we quash the order dated 26/11/2010 as per Annexure A in W.P. No.68780/2010 as well as the order dated 11/01/2011 as per Annexure F in W.P. Nos.60262-60264/2011 & 67107-67108/2009 and reserve the liberty to the authorities to issue notice to the petitioner if they chose to propose to issue permits for exporting the sugarcane grown in the reserved area after comply with the procedure prescribed. No Cost.