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2015 DIGILAW 171 (KAR)

Chamundeshwari Sugars v. Government of Karnataka

2015-02-12

D.H.WAGHELA, RAM MOHAN REDDY

body2015
Judgment D.H. Waghela, J. 1. All these appeals are preferred from the common judgment dated 06.11.2014 of learned single Judge in number of petitions involving the same issues which are dealt with by the elaborate common impugned judgment. 2. The relevant factual background in which legal issues were raised by parties, consists of the notification dated 23.11.2013 issued by the Member Secretary, Sugarcane Control Board and Commissioner for Cane Development and Director of Sugar, in exercise of the powers conferred under Section 4(f) of the Karnataka Sugarcane (Regulation of Purchase and Supply) Act, 2013 (“Act” for short), based on the recovery of sugarcane in northern and southern parts of the State and taking note of the concessions provided by the Government during the year 201314, such as exemption from purchase tax, exemption from road cess and exemption from VAT on sugar and also based on the formula for sharing of revenue derived from sugarcane and its primary byproducts like bagasse, molasses and pressmud. The sugarcane prices were notified for the year 201314 for South Karnataka on exgate basis to be Rs.2500/- per MT and for North Karnataka the same price was notified on exfield basis. Various sugar mills and sugar factories filed their petitions to challenge the aforesaid notification as also to challenge the validity of the Act. The challenge was mounted mainly on three broad grounds namely, (1) that the impugned notification and relevant provisions of Section 4 of the Act were repugnant to the Sugarcane (Control) Order, 1966 (the “Control Order” for short) issued under Section 3 of the Essential Commodities Act, 1955; (2) that the impugned notification was in violation of the provisions of Section 4 of the Act and, (3) that the fixation of the sugarcane price was not legal and proper. All the contentions along with the precedents cited in support thereof have been elaborately considered in the impugned judgment and findings and conclusions are recorded, which are to the effect that the Control Order does not impose any fetters on the powers of the state legislature to enact the law as per the provisions of which the sugarcane prices could be higher than those fixed under the aforesaid Control Order. It is also found that the price fixation under the Act is not arbitrary and that the price fixation could not be at the end of the season in view of the provisions of Section 9 of the Act. Therefore, taking of the price of sugarcane prevailing in the immediately preceding period for fixation of sugarcane price at the commencement of crushing season could not be found fault with, according to the impugned judgment. It is also found that either due to the presence of nonmembers of the Sugarcane Control Board at its meetings or otherwise, the decision making process was not vitiated and no prejudice or injustice was shown to have been caused to any party. On the basis of these findings and conclusions, all the petitions were dismissed and hence the present group of appeals. 3. The appeals were argued for the appellants by learned senior counsel Sri S.Vijaya Shankar and Sri D.N. Nanjunda Reddy and towards the end of the arguments, summary of submissions in writing have also been placed on record. It is, in substance, contended that the finding of learned single Judge that the power to enact the Act is traceable to Entry 14 of List II of Seventh Schedule of the Constitution is incorrect and not consistent with the ratio of judgment of the Apex Court in Tika Ramji vs. State of U.P. ( AIR 1956 SC 676 ). It ought to have been appreciated by the Court that once the standing crop of sugar is severed from the ground, it is ‘goods’ and trade and commerce in such goods would consequently fall under Entry 33 of List III. It was on that basis submitted that since the Act falls in Entry 33 of List III, it could not have been enacted without seeking assent of the President in terms of the provisions of sub-clause (2) of Article 254 of the Constitution. In a related but independent argument, it was contended that the entire field of legislation, including the matter of price at which sugarcane is to be sold, was already occupied by the Control Order and the finding in the impugned judgment that there was no repugnancy between the Control Order and the provisions of the Act was not correct. In a related but independent argument, it was contended that the entire field of legislation, including the matter of price at which sugarcane is to be sold, was already occupied by the Control Order and the finding in the impugned judgment that there was no repugnancy between the Control Order and the provisions of the Act was not correct. Even as the impugned judgment is relying upon binding decision of Constitution Bench of the Supreme Court in U.P. Cooperative Cane Unions Federations vs. West U.P. Sugar Mills Association [ (2004) 5 SCC 430 ], it was submitted for the appellants that the said judgment was rendered in light of the erstwhile provisions of the Control Order as it existed prior to the amendments brought into effect in the year 2009. It was vehemently argued that after the amendment of the Sugarcane (Control) Order in 2009, the unoccupied field, if any had remained, was filledup and there was no scope for the State legislature to enact another law on the same subject. It was also submitted that decision in the case of U.P. Cooperative Cane Unions Federations (supra) has been subsequently doubted and the matter has since been referred to larger bench by an order in West U.P. Sugar Mills Association vs. State of Uttar Pradesh [ (2012) 2 SCC 773 ]. On that basis it was requested that the appeals may be admitted and decision of the larger bench may be awaited, following the decision of the Apex Court in D.K. Trivedi & Sons vs. State of Gujarat ( AIR 1986 SC 1323 ). 4. Elaborating further, learned senior advocate Sri S. Vijaya Shankar submitted that, after the amendment of Sugarcane (Control) Order in the year 2009, fair and remunerative price fixed by the Central Government under Clause (3) of the Control Order fully remunerates the sugarcane farmers, even taking care of their profit margins. He submitted that, admittedly, such fair and remunerative price fixed by the Central Government was already paid by the appellants to the farmers and even for the purpose of fixing the price under Section 4 of the Act, the fixation of price has to await actual revenue realization at the end of the sugar season. He submitted that, admittedly, such fair and remunerative price fixed by the Central Government was already paid by the appellants to the farmers and even for the purpose of fixing the price under Section 4 of the Act, the fixation of price has to await actual revenue realization at the end of the sugar season. Thus, according to him, payment of the price for the sugarcane supplied to sugar factories has to be in two installments and the final price even under the State Act has to await completion of the sugarcane season. He also submitted that the State Government itself having realized the lacunae and ambiguity in the relevant provisions of the Act, an amendment was brought, while the petitions were pending before the Court, to explain and clarify the State Act. He submitted that the impugned notification ought to be tested on the touchstone of the amendment of the State Act; and in light of the amended provisions of the Act, the impugned notification would be void ab initio. 5. Since the issue of pendency of a reference to the larger Bench of the Apex Court is raised and specific request is made to admit the appeals and await decision by a larger Bench of the Hon’ble Apex Court, it is necessary to consider, before dealing with the appeals, the recent Judgments of the Apex Court in that regard. In Ashok Sadarangani and Another vs. Union of India and Others [ (2012) 11 SCC 321 ], it was urged before the Apex Court that as the same issue under consideration was also the subject matter of reference to a larger Bench, the Court should abstain from pronouncing Judgment on the issue which was the subject matter in the reference. The Supreme Court, however, has adopted the view that pendency of a reference to a larger Bench did not mean that all other proceedings involving same issue would remain stayed till a decision would be rendered in the reference. (a) In Manager, National Insurance Company Limited vs. Saju P. Paul and Another [ (2013) 2 SCC 41 ], it is reiterated that pendency of consideration of the same question by a larger bench did not mean that the course that was followed in earlier decisions should not be followed, more particularly, in the fact situation of the case before the Apex Court. (b) In a later three Judge Bench decision of the Apex Court in P. Sudhakar Rao and Others vs. U. Govinda Rao and Others [ (2013) 8 SCC 693 ], the Apex Court was pleased to observe: “55. Be that as it may, the pendency of a similar matter before a larger Bench has not prevented this Court from dealing with the issue on merits. Even on earlier occasions, the pendency of the matter before the larger Bench did not prevent this Court from dealing with the issue on merits. Indeed, a few cases including Pawan Pratap Singh [ (2011) 3 SCC 267 ] were decided even after the issue raised in Asis Kumar Samanta [ (2007) 5 SCC 800 ] was referred to a larger Bench. We, therefore, do not feel constrained or precluded from taking a view in the matter.” (c) The Division Bench of this Court, in the Director, Karnataka Government Insurance Department, Bangalore vs. G.V. Raju (2012 (6) Kar.L.J. 209), has also taken the view that in absence of any authoritative decision by a larger Bench of the Supreme Court, this Court is bound by the dictum in Bangalore Water Supply and Sewerage Board, Etc., vs. A. Rajappa and others [ (1978)2 SCC 213 ], particularly in view of express observations regarding the binding nature of its decision. Thus, the Constitution Bench decision in Bangalore Water Supply’s case (supra) was followed as the one holding the field. The submission that this Court had to await pronouncement of the larger Bench of the Supreme Court on the correctness of the decision in Bangalore Water Supply’s case (supra) was, in terms, rejected after adverting to the Judgment in D.K. Trivedi and Son’s case (supra). 6. In the facts of the present case, since the main controversy is practically covered by the Constitution Bench decision in U.P. Cooperative Cane Unions Federation’s case (supra), we deem it appropriate and necessary to proceed with consideration of appeals in light of the binding judgment of the Apex Court. However, before examination of the contentions canvassed on behalf of the appellants, it may be apposite to quote the statutory provisions relevant for the present purpose: [A] The Sugarcane (Control) Order 1966 as it stood after its amendment in the year 2009 and at the time of the impugned notification dated 23.11.2013, in its relevant parts, reads as under: “1. …. …. “2.Definitions: In this order, unless the context otherwise requires: (a)…. (b)... (c)… (cc) “fair and remunerative price of sugarcane” means the price fixed by the Central Government under clause 3, from time to time, for sugarcane; (d)… (e)… (f) … (g) ‘price’ means the price or fair and remunerative price fixed by the Central Government from time to time for sugarcane delivered (i) To a sugar factory at the gate of the factory or at a sugarcane purchasing centre; or (ii)to a khandsari unit. (h)… (i)…. (j)…. (k) ‘year’ means the year commencing on the first day of July and ending with the thirtieth day of June in the year next following. “3. Fair and remunerative 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 Gazette, from time to time, fix the fair and remunerative 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; (e) the recovery of sugar from sugarcane; and (f) the realization made from sale of by products viz. molasses, bagasse and press mud or their imputed value; (g) reasonable margins for the growers of sugarcane on account of risk and profits 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 3A, 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. Explanation (2) - When a sugar factory produces ethanol directly from sugarcane juice or BHeavy 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 one tone of production of sugar. Explanation (3) - Production of ethanol directly from sugarcane juice shall be allowed in case of sugar factories only. Explanation (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). (3) Where a producer of sugar purchases any sugarcane from a grower of sugarcane or from a sugarcane growers’ cooperative society, the producer shall, unless there is an agreement in writing to the contrary between the parties, pay within 14 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 sugarcane growers’ cooperative 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. (3A) 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. “(3B) ….. “(4) to (14)…………………………………… “3A. ….. “4. ….. “4A ….. “5. Additional price for sugarcane purchased: (1) Where a producer of sugar or his agent purchases any sugarcane from a grower of sugarcane or a growers’ cooperative society during each of the four successive years beginning on the 1st day of November, 1958, the producer shall, in addition to the fair and remunerative price of sugarcane fixed under sub-clause (1) of clause 3, pay to the grower or the cooperative society, as the case may be, an additional price, if found due, in accordance with the provisions of the First Schedule hereto annexed. “(2) to (7) ……………… “6 to 12 …………….” [B] The relevant provisions of the Karnataka Sugarcane (Regulation of Purchase and Supply) Act, 2013, read as under: “1.….. “2.Definitions:In this Act, unless the context otherwise requires; (j) “Reserved area” means an area notified under the Sugarcane (Control) Order, 1966. (n) “Sugarcane season” means the year commencing on the first day of the October and ending with thirtieth day of September next year. “3. Sugarcane Control Board……… “4. Functions of the Board The functions of the Board shall be (a) to recommend ways and means of maintaining healthy relations between occupier of the factory and cane growers; (b) To offer advice on any matter which be referred to it by the Government or the Commissioner for Cane Development and Director of Sugar, especially in respect of the regulation of the purchase of sugarcane; (c) To bring to the notice of the Commissioner for Cane Development and Director of Sugar, cases of breach of any of provisions of the Act and of the rules made there under and to make suggestions for the prevention of the same; (d) To advice the Commissioner regarding suitability or otherwise of cane varieties for cultivating in different regions; and (e) to advice the Commissioner for Cane Development and Director of Sugar, in the sugarcane development work; (f) to decide sugarcane price on revenue sharing basis taking into consideration actual revenue realized from sugar, bagasse, molasses and pressmud. “5. to 6. …………. “7. Purchase of sugarcane in reserved area ………. “8. ………….. “9. Payment to sugarcane growers: (1) As soon as sugarcane is supplied to the occupier of a factory, the factory shall be liable to pay the price of sugarcane supplied within fourteen days to the sugarcane growers; (2) Payment shall be made on the basis of the recorded weight of the sugarcane at the factory. The price of the sugarcane to be payable be calculated to the nearest rupee; (3) An occupier of a factory shall be liable to make for all payments due for sugarcane purchased by him and if such occupier of the factory fails to make payments, the occupier of such factory shall be responsible for making such payments with interest as specified in Sugarcane (Control) Order, 1966 thereon from the date such payment falls due. “10. “10. to 16 ………………..” [C] The amendment to the above Act, which was sought to be pressed into service, in its relevant parts reads as under: “The Karnataka Sugarcane (Regulation of Purchase and Supply) (Amendment) Act 2014, (published in the Special Official Gazette dated 28.08.2014.) “1.…. “2. Amendment of section 2: In the Karnataka Sugarcane (Regulation of Purchase and Supply) Act, 2013 (Karnataka Act 33 of 2013) (hereinafter referred to as the principal Act) in section 2, (i) clause (a) shall be renumbered as clause (aa) and before clause (aa) as so renumbered the following shall be inserted, namely: “(a) “additional sugarcane price” means the additional price to be paid by the occupier of the factory to the sugarcane grower for the sugarcane delivered over and above Fair and Remunerative price, declared by the Commissioner for cane development and Director of sugar under section 4A, based on the decision of the Board.” (ii) after clause (e), the following shall be inserted namely: “(ea) “Fair and Remunerative Price of Sugarcane (FRP)” means price fixed by the Central Government under clause 3 of Sugarcane (Control) Order, 1966 for the year for sugarcane delivered.” (iii) for clause (n), the following shall be substituted, namely: “(n) “Year” means the year commencing on the first day of July and ending with the thirtieth day of June in the year next following.” “3. Amendment of section 3.………….. “4. Amendment of section 4. In section 4 of the principal Act, for clause (f), the following shall be substituted, namely: (f) to decide additional sugarcane price over and above Fair and Remunerative Price for the year on revenue sharing basis; (g) to inquire into any matter in discharge of its functions including matter relating to revenues and expenditures, Books of accounts of the factory etc., under section 4B, required, if any; (h) to consider the report of the expert committee constituted under section 4C on the revenue realization for determination of additional sugarcane price; and (i) to perform such other functions as may be prescribed. “5. Insertion of new sections 4A, 4B, 4C and 4D.After section 4 of the principal Act, the following shall be inserted, namely: “4A. “5. Insertion of new sections 4A, 4B, 4C and 4D.After section 4 of the principal Act, the following shall be inserted, namely: “4A. Declaration of Additional Sugarcane Price of Sugarcane: (1) The Commissioner for Cane Development and Director of Sugar on the decision of the Board may, by notification, declare the additional sugarcane price over and above Fair and Remunerative Price of Sugarcane for the year. (2) Every order issued under sub-section (1) shall be laid before both Houses of State Legislature. “4B. Board to have certain powers of civil court.………… “4C. Committee for calculation of Revenue realization.………….. “4D. Factors to be taken into consideration by the Board for deciding additional Sugarcane Price.…………… “6. Substitution of section 7. For section 7 of the principal Act, the following shall be substituted, namely: “7. Purchase of Sugarcane from the reserved area. Purchase of sugarcane by the sugar factories from the reserved area shall be regulated as per the Sugarcane (Control) Order, 1966 as amended from time to time. “7. Amendment of section 8.……………. “8. Amendment of section 9. In section 9 of the principal Act, for sub-section (1), the following shall be substituted, namely: “(1) The payment to the sugarcane growers shall be in two stages. In the first stage immediately, on supply of sugarcane, the sugarcane grower shall be paid the Fair and Remunerative Price based on the previous year’s recovery of the concerned factory by the occupier of the factory. All other conditions for sugarcane payment shall be as per the provisions of clause 3 of Sugarcane (Control) Order, 1966. (1A) In the second stage, the occupier of the factory shall make the payment of additional sugarcane price within fourteen days from the date of declaration under section 4A. (1B) Every payment made by the occupier of the factory under this Act shall be paid to sugarcane growers through his bank account only. (1C) The provisions of Sugarcane (Control) Order, 1966 to recover the dues with respect to Fair and remunerative price shall mutatis mutandis be applicable for recovery of arrears of additional sugarcane price also.” 7. It would clearly appear on bare reading of the amendment of the State Act, notified on 28.08.2014, that the concept of “additional sugarcane price” has been newly introduced in the extant Act of 2013. It would clearly appear on bare reading of the amendment of the State Act, notified on 28.08.2014, that the concept of “additional sugarcane price” has been newly introduced in the extant Act of 2013. With the addition and introduction of Sections 4A, 4B, 4C and 4D, a whole new scheme is introduced for declaration of and provisions for additional sugarcane price. Consequential amendments are also made in the provisions of section 9 of the Act so as to provide for payment to the sugarcane growers in two stages. There is nothing to indicate in the text or context of the Amendment Act that the amendments were intended to have a retrospective effect. 8. In view of the aforesaid contentions of the appellants and the position of statutory provisions as obtaining at the time the impugned notification was issued, the field occupied by the Central Order was in no way encroached upon by the State Act while issuing the impugned notification. Sub-clause (2) of Clause (3) of the Central Order leaves no room for doubting the fact that, what was intended to be prescribed as a fair and remunerative price under the Central Order was the minimum price and sale or purchase at a price lower than the price fixed under sub-clause (1) of clause (3) was prohibited. 9. Having regard to that undisputable position, the Constitution Bench of the Apex Court has, in U.P. Cooperative Cane Unions Federations (supra), observed: “12. ……. Sub-clause (5) of clause 5A lays down that no additional price determined under sub-clause (2) shall become payable by a producer of sugar who pays a price higher than the “minimum sugarcane price” fixed under clause 3 to the sugarcane grower, if the same is not less than the total of the price fixed under clause 3(1) and additional price determined under clause 5A(2). This provision again contemplates payment of price higher than the minimum price fixed under clause 3(1). A whole reading of the 1966 Order would, therefore, show that the Central Government shall fix the minimum price of sugarcane but there can be a price higher than the minimum price which may be in the nature of agreed price between the producer of sugar and the sugarcane grower or the sugarcane growers’ cooperative society. A whole reading of the 1966 Order would, therefore, show that the Central Government shall fix the minimum price of sugarcane but there can be a price higher than the minimum price which may be in the nature of agreed price between the producer of sugar and the sugarcane grower or the sugarcane growers’ cooperative society. So the field for a price higher than the minimum price is clearly left open in the 1966 Order made by the Central Government.” It is, thereafter, concluded by the Apex Court as under: “37. Under sub-clause (1) of clause 3 of the 1966 Order, the Central Government can only fix a minimum price of sugarcane. This clause should be read along with sub-clause (2) which creates an embargo or prohibition that no person shall sell or agree to sell sugarcane to a producer of sugar and no such producer shall purchase or agree to purchase sugarcane at a price lower than that fixed under sub-clause (1). The inconsistency or repugnancy will arise if the State Government fixed a price which is lower than that fixed by the Central Government. But, if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy as it is possible for both the orders to operate simultaneously and to comply with both of them. A higher price fixed by the State Government would automatically comply with the provisions of sub-clause (2) of clause 3 of the 1966 Order. Therefore, any price fixed by the State Government which is higher than that fixed by the Central Government cannot lead to any kind of repugnancy.” (underlines added) 10. On the other hand, another Constitution Bench, in Belsund Sugar Co. Ltd vs. State of Bihar and Others (1999) 9 SCC 620 , earlier held as under: “61. The aforesaid relevant provisions of the Sugarcane (Control) Order show that it seeks to lay down the minimum guaranteed price of sugarcane to the sugarcane growers with a corresponding obligation on them to supply sugarcane to the earmarked factories for which the reserved areas can be fixed. This Order also contemplates a negotiated price between the sugarcane growers on the one hand and the sugarcane factories on the other, for whom a fixed quota of sugarcane can be earmarked. “62. This Order also contemplates a negotiated price between the sugarcane growers on the one hand and the sugarcane factories on the other, for whom a fixed quota of sugarcane can be earmarked. “62. It has to be appreciated that the aforesaid provisions of the Sugarcane (Control) Order operate in the same field in which the Bihar legislative enactment, namely, the Sugarcane Act operates and both of them are complementary to each other. When taken together, they wholly occupy the field of regulation of price of sugarcane and also the mode and manner in which sugarcane has to be supplied and distributed to the earmarked sugar factories and thus lay down a comprehensive scheme of regulating purchase and sale of sugarcane to be supplied by sugarcane growers to the earmarked sugar factories. It is, however, true that a comprehensive procedure or machinery for enforcing these provisions is found in greater detail in the Sugarcane Act of the Bihar Legislature. But on a combined operation of both these provisions, it becomes at once clear that the general provisions of the Market Act so far as the regulation of sale and purchase of sugarcane is concerned get obviously excluded and superseded by these special provisions. “63 to 66. …….. “67. In this connection, Sabyasachi Mukharji, J., speaking for the Court made the following pertinent observations: “Unless the Acts, with the intention of implementing various socioeconomic plans, are read in such complementary manner, the operation of the different Acts in the same field would create contradiction and would become impossible. It is, therefore, necessary to take a constructive attitude in interpreting provisions of these types and determine the main aim of the particular Act in question for adjudicating before the Court.” “68 to 70…… “71. It is, of course, true that the Union Parliament has not exercised its concurrent legislative powers under Entry 33 of List III for regulating the sale and purchase of sugarcane. But, as noted earlier, the Sugarcane (Control) Order promulgated under the Central legislation of the Essential Commodities Act when read harmoniously and in conjunction with the State Sugarcane Act carves out a special field for their operation and by the sweep of their combined operation the general provisions of the Market Act pro tanto get excluded so far as the transactions of purchase and sale of sugarcane in the market area are concerned. “72 to 85………… “86. “72 to 85………… “86. It is not possible to agree with this submission for the simple reason that the provisions of the Sugar (Control) Orders have not to be read in isolation but will have to be read with the special provisions controlling the production, sale and purchase of sugarcane out of which sugar is manufactured by the very same sugar factories functioning in the market area. They are all integrated transactions and are subject to a wellknit statutory scheme of control of these commodities. It is obvious that regulation of sugarcane supply and distribution is not in isolation. The main purpose of such regulation is for ensuring better quality and adequate quantity of sugar manufactured out of sugarcane supplied by sugarcane growers to earmarked sugar factories which manufacture sugar by crushing sugarcane in their factories by resorting to vacuum pan manufacturing process. Therefore, it is the ultimate sale of the manufactured article, namely, sugar by way of levy sugar or in free market that is sought to be controlled by the Control Orders which cannot effectively operate save and except in harmony with the provisions enacted for the control of raw material, namely, the sugarcane as envisaged by the Sugarcane Orders as well as the Sugarcane Act. They together, therefore, provide a complete machinery for controlling the production, sale and purchase not only of the raw material sugarcane but also the finished product sugar and in this background we have to visualize the legislative intent underlying the enactment of the Sugarcane Act on the one hand and the exclusion of Section 15 to such transactions by the delegate of the legislature, namely, the State of Bihar on the other……….” “168…….. “169. Bhagwati, J., speaking for the Constitution Bench, placing reliance on the observations of Sulaiman, J., in the decision of the Federal Court in Shyamakant Lal v. Rambhajan Singh (AIR 1939 FC 74) extracted, with approval, the following passage on the said decision as under: “When the question is whether a Provincial legislation is repugnant to an existing Indian law, the onus of showing its repugnancy and the extent to which it is repugnant should be on the party attacking its validity. There ought to be a presumption in favour of its validity, and every effort should be made to reconcile them and construe both so as to avoid their being repugnant to each other; and care should be taken to see whether the two do not really operate in different fields without encroachment. Further, repugnancy must exist in fact, and not depend merely on a possibility. Their Lordships can discover no adequate grounds for holding that there exists repugnancy between the two laws in districts of the Province of Ontario where the prohibitions of the Canadian Act are not and may never be in force: (Attorney General for Ontario v. Attorney General for the Dominion of Canada (1896 AC 348)). “Thereafter the following pertinent observations were made by Bhagwati, J., speaking for the Constitution Bench: “In the instant case, there is no question of any inconsistency in the actual terms of the Acts enacted by Parliament and the impugned Act. The only questions that arise are whether Parliament and the State Legislature sought to exercise their powers over the same subject-matter or whether the laws enacted by Parliament were intended to be a complete exhaustive code or, in other words, expressly or impliedly evinced an intention to cover the whole field.”” 11. Even earlier, in Vijay Kumar Sharma and others vs. State of Karnataka and others ( AIR 1990 SC 2072 ), it is in terms held that there could be no repugnancy unless the two Acts or provisions are fully incompatible with each other or the two would lead to absurd result. The purpose of determining the inconsistency is to ascertain the intention of the parliament which could be gathered from consideration of the entire field occupied by the State legislature. The proper test is, whether the effect could be given to the provisions of both the laws or whether both the laws can stand together. If both the laws, without trenching upon one another or colliding with each other, operate harmoniously, the question of repugnancy does not arise. As discussed earlier, and authoritatively pronounced by the Apex Court in U.P. Cooperative Cane Unions Federations (supra), if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy, as it is possible for both the orders to operate simultaneously. As discussed earlier, and authoritatively pronounced by the Apex Court in U.P. Cooperative Cane Unions Federations (supra), if the price fixed by the State Government is higher than that fixed by the Central Government, there will be no occasion for any inconsistency or repugnancy, as it is possible for both the orders to operate simultaneously. Therefore, the arguments for the appellants that there is repugnancy or inconsistency between the provisions of the Control Order and the Act, or that the Control Order occupied the whole field exclusively, have to be negatived. Assuming or even accepting that both the enactments were falling within the scope of Entry 33 of the Concurrent List in Seventh Schedule of the Constitution, the question of application of sub-clause (2) of Article 254 does not arise in the facts of the present cases. 12. The other argument that Section4 of the State Act required fixation of price on the basis of actual revenue realization at the end of the sugar season has to be stated to be rejected, in view of the provisions of Section9 of the Act, as elaborately discussed in the impugned Judgment. The other related argument that the State Government had to amend the State Act while the petitions of the appellant were being heard has also no legs either in facts or law. The overarching argument that the impugned notification has to be tested on the anvil of the amended provisions of Section4, 4A, 4C, 4D and Section9 of the Act, was sought to be substantiated on the basis that, the appeal being continuation of the original proceedings, the legal provisions in force at the time of hearing of the appeal have to be applied. 13. The observations as under of three judges Bench of the Apex Court in Zile Singh Vs. State of Haryana and others [ (2004) 8 SCC 1 ] were relied upon in support of the above submissions: “14. The presumption against retrospective operation is not applicable to declaratory statutes . . . . In determining, therefore, the nature of the Act, regard must be had to the substance rather than to the form. If a new Act is “to explain” an earlier Act, it would be without object unless construed retrospectively. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as to the meaning of the previous Act. If a new Act is “to explain” an earlier Act, it would be without object unless construed retrospectively. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as to the meaning of the previous Act. It is well settled that if a statute is curative or merely declaratory of the previous law, retrospective operation is generally intended…… An amending Act may be purely declaratory to clear a meaning of a provision of the principal Act which was already implicit. A clarificatory amendment of this nature will have retrospective effect (ibid., pp.46869).” The following observations of the Apex Court in Dilip Vs. Mohd. Azizul Haq and another, [ (2000)3 SCC 607 ] were also pressed into service for the appellant: “8. The High Court further concluded that the amendments have no retrospective effect. The provision came into force when the appeal was pending. Therefore, though the provision is prospective in force, has “retroactive effect”. This provision merely provides for a limitation to be imposed for the future which in no way affects anything done by a party in the past and statutes providing for new remedies for enforcement of an existing right will apply to future as well as past causes of action. The reason being that the said statutes do not affect existing rights and in the present case, the insistence is upon obtaining of permission of the Controller to enforce a decree for eviction and it is, therefore, not retrospective in effect at all, since it has only retroactive force.” 14. As against the above Judgments, it is held in Garikapati Veeraya Vs. N. Subbiah Choudhry and others, ( AIR 1957 SC 540 ): “25. In construing the Articles of the Constitution we must bear in mind certain cardinal rules of construction. It has been said in Hough V. Windus, 188412 QBD 224 at p.237 (V) that “Statutes should be interpreted, if possible, so as to respect vested right.” The golden rule of construction is that, in the absence of anything in the enactment to show that it is to have retrospective operation, it cannot be so construed as to have the effect of altering the law applicable to a claim in litigation at the time when the Act was passed.. . . . . .” Further, in Shyam Sunder and others vs. Ram Kumar & another [ (2001)8 SCC 24 ], the Constitution Bench of the Apex Court held thus: “26. In Hitendra Vishnu Thakur v. State of Maharashtra [ (1994)4 SCC 602 ], this Court laid down the ambit and scope of an amending Act and its retrospective operation as follows: (SCC p.633, para 26) “i) A statute which affects substantive rights is presumed to be prospective in operation unless made retrospective, either expressly or by necessary intendment, whereas a statute which merely affects procedure, unless such a construction is textually impossible, is presumed to be retrospective in its application, should not be given an extended meaning and should be strictly confined to its clearly defined limits. ii) Law relating to forum and limitation is procedural in nature, whereas law relating to right of action and right of appeal even though remedial is substantive in nature. iii) Every litigant has a vested right in substantive law but no such right exists in procedural law. iv) A procedural statute should not generally speaking be applied retrospectively where the result would be to create new disabilities or obligations or to impose new duties in respect of transactions already accomplished. v) A statute which not only changes the procedure but also creates new rights and liabilities shall be construed to be prospective in operation, unless otherwise provided, either expressly or by necessary implication.” “27. In K.S. Paripoornan Vs. State of Kerala [ (1994)5 SCC 593 ] (SCC at p. 636), this Court while considering the effect of amendment in the Land Acquisition Act in pending proceedings held thus: (SCC para 67) “67. In the instant case we are concerned with the application of the provisions of subsection (1A) of S.23 as introduced by the Amending Act to acquisition proceedings which were pending on the date of commencement of the amending Act. In the instant case we are concerned with the application of the provisions of subsection (1A) of S.23 as introduced by the Amending Act to acquisition proceedings which were pending on the date of commencement of the amending Act. In relation to pending proceedings, the approach of the courts in England is that the same are unaffected by the changes in the law so far as they relate to the determination of the substantive rights and in the absence of a clear indication of a contrary intention in an amending enactment, the substantive rights of the parties to an action fall to be determined by the law as it existed when the action was commenced and this is so whether the law is changed before the hearing of the case at the first instance or while an appeal is pending (See Halsbury’s Laws of England, 4th Edn., Vol. 44, Para 922).” “28. From the aforesaid decisions the legal position that emerges is that when a repeal of an enactment is followed by a fresh legislation, such legislation does not affect the substantive rights of the parties on the date of the suit or adjudication of the suit unless such a legislation is retrospective and a court of appeal cannot take into consideration a new law brought into existence after the judgment appealed from has been rendered because the rights of the parties in an appeal are determined under the law in force on the date of the suit. However, the position in law would be different in the matters which relate to procedural law, but so far as substantive rights of parties are concerned, they remain unaffected by the amendment in the enactment. We are, therefore, of the view that where a repeal of provisions of an enactment is followed by fresh legislation by an amending Act, such legislation is prospective in operation and does not affect substantive or vested rights of the parties unless made retrospective either expressly or by necessary intendment. We are further of the view that there is a presumption against the retrospective operation of a statute and further a statute is not to be construed to have a greater retrospective operation than its language renders necessary, but an amending act which affects the procedure is presumed to be retrospective, unless the amending Act provides otherwise.. . . .” 15. . . .” 15. As seen earlier there is nothing in the Karnataka Sugarcane (Regulation of Purchase and Supply) (Amendment) Act, 2014 to suggest that it is intended to have any retrospective effect; nor is there any provision to explain or clarify any existing provision of the Act of 2013, although it is true that the Amendment Act of 2014 is in effect provides for additional sugarcane price and fair and remunerative price of sugarcane and new provisions are made for fixation of such additional and fair and remunerative price. All such provisions are apparently intended to facilitate better administration and regulation of sugarcane prices, as well as due payment thereof, in time. These provisions practically supplant the scheme of the extant Act of 2013, and such provisions cannot be implemented retrospectively, particularly when the price of the sugarcane would have been already determined and declared on the one hand and the payment thereof, would have fallen due already. 16. Thus, no ground is made out to interfere with the impugned judgment. The appeals are apparently inspired by the motive of denying and disputing the liability of paying in time the price of sugarcane as determined and declared under the Act. It is not certain and not asserted that all the sugarcane growers concerned were made even parties to these proceedings. In the result, the appeals are dismissed along with interim applications made therein, with no order as to cost.