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TMI Blog1996 (2) TMI 408X X X X Extracts X X X X X X X X Extracts X X X X ..... ixed under clause 5A, as a part of the amount paid as advance prior to fixation of the additional price under clause 5A, cannot be treated automatically as a part of the total price of sugarcane. In matters arising out of decisions of the Karnataka High Court, this aspect has not been adverted to and the writ petitions have been dismissed without going into this question. - Civil Appeal No. 11083 To 11141 of 1995, & 1073310735, 11213, 11605, 1160611608, 11211, 11214, 11212 of 1995, W.P. Nos. 869, 497 of 1982, & 4583 of 1993 - - - Dated:- 8-2-1996 - VEA J.S. RM AND VENKATASWAMI K. JJ. R.F. Nariman, Senior Advocate (P.H. Parekh and E.R. Kumar, Advocates, with him), for some respondents in the appeals from Tamil Nadu. K.R. Nagaraj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ol) Order, 1966, the material part of which is as under: "5A. Additional price for sugarcane purchased on or after 1st October, 1974.(1) Where a producer of sugar or his agent purchases sugarcane, from a sugarcane grower during each sugar year, he shall in addition to the minimum sugarcane price fixed under clause (3), pay to the sugarcane grower an additional price, if found due, in accordance with the provisions of the Second Schedule annexed to this Order. (2) The Central Government or the State Government, as the case may be, may authorise any person or authority, as it thinks fit, for the purpose of determining the additional price payable by a producer of sugar under subclause (1) and the person or authority, as the case may b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sugar factory was directed to make that payment and in compliance thereof this sugar factory paid the excess amount as an "advance" described as under: "........being advance payment towards cane supply during 198081 season, against probable additional cane price under clause 5A of the Sugarcane (Control) Order, 1966." This amount paid as "advance" by the sugar factory for purchase of sugarcane in anticipation of fixation of the additional cane price under clause 5A was Rs. 52.40 per M.T. Accordingly, on fixation of the additional cane price at Rs. 28.15 per M.T., the excess amount of advance came to (Rs. 52.40 per M.T. minus Rs. 28.15 per M.T.) Rs. 24.25 per M.T. While the sugar factory claims that this excess amount of Rs. 24.25 per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atute there is no liability of the purchaser to pay to the grower any amount in excess of this aggregate amount. Thus, without any contractual or statutory basis fixing the sale price of sugarcane at an amount higher than the minimum cane price fixed under clause 3 and the additional cane price fixed under clause 5A, any sum paid by the purchaser to the grower as advance prior to fixation of the additional cane price under clause 5A cannot form part of the price of cane sugar. In these matters there is admittedly no statutory basis since the "State advice" to the purchasers to pay a certain amount in addition to the minimum cane price fixed under clause 3, in anticipation of fixation of the additional cane price under clause 5A, does not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luding the amount in excess of the additional price fixed under clause 5A then in that case the entire amount would be the price of sugarcane. However, there is no such basis found in the present case wherein the excess amount forming part of the advance was paid only under compulsion on the direction contained in the "State advice". It is significant that a provision for adjustment is clearly made in subclause (6) of clause 5A. This provision supports the view we have taken. The decision of the Madras High Court which is reported in Thiru Arooran Sugars Ltd. v. Deputy Commercial Tax Officer, Mannargudi [1988] 71 STC 444 is, therefore, upheld and the appeals against the decision of the Madras High Court are, therefore, dismissed. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upplied, it must be found proved as a fact that the higher price including the excess amount was paid as the price of sugarcane under an agreement between the grower and the purchaser irrespective of a lower amount being fixed as the aggregate of the price fixation under clauses 3 and 5A of the Control Order. Unless a clear finding to that effect is recorded, the amount paid by the purchaser in excess of the aggregate of the minimum price fixed under clause 3 and the additional price fixed under clause 5A, as a part of the amount paid as advance prior to fixation of the additional price under clause 5A, cannot be treated automatically as a part of the total price of sugarcane. In matters arising out of decisions of the Karnataka High Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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