The Supreme Court on Thursday sought reply from the Centre on a petition filed by sugar company Bajaj Hindustan accusing the Centre of depriving sugar mills and farmers from their legitimate dues accrued under earlier direction issued by the apex court.

The sugar company said that the issue of levy sugar price had been already settled by the apex court in the case of Mahalakshmi sugar mills co Ltd Vs Union of India and others where it had directed the central government to take SAP (actual price paid to cane growers) into consideration while fixing levy price for sugar from 1983-84 onwards. It had also directed the Centre to refix the levy price and also refund the excess amount illegally not paid to the mills.

A bench headed by Justice V S Sirpurkar has issued notice to the ministries of consumer affairs, food and public distribution, and law and justice on the issue.

Bajaj Hindustan has challenged the constitutional validity of the Essential Commodities (Amendment and Validation) Act 2009 that purportedly amended the provisions of Section 3(3C) of the Essential Commodities Act 1955 with effect from October 1, 1974.

The sugar mill said that such impugned Act and order was arbitrary, illegal and grossly violative of its rights under Article 14, 19(1)(g) and 300A of the Constitution.

To overrule the Supreme Court directions, according to the company, the Central government brought the 2009 Act which amended Section 3 of the 1955 Act so as to provide that state advisory price (SAP) was not be taken into consideration while fixing levy price and such amendment was not subject to judicial review and can?t be challenged in any court of law.

Clause B mandated that if any party or the state government fixed any price above the fair and remunerative price (FRP) fixed by the central government, then such party or state government shall pay the amount that is fixed above the central government price to the growers or sugarcane growers cooperative society.

According to the petition, the government had brought this illegal Act and order which absolutely changed the entire price mechanism.

It submitted that the sugar price under the new pricing regime would be rendered wholly arbitrary if SAP, which is mandatorily payable by the sugar manufacturers as per the state governments’ directives, was not taken into account.

?? …inspite of FRP being introduced as fair and remunerative price, existence of SAP, which is much higher then FRP, is still there and sugar mills have to pay SAP,?? the petition stated, adding that there was lack of coordination between the Centre and state governments and it can?t be made to suffer by paying not only for future but also for the past.

The firm alleged that by making the amendment operative retrospectively, the government had made all the cases, which challenge the arbitrary fixing of levy price of sugar, pending before the high courts of Delhi, Allahabad and Calcutta as infructuous.